Interim report
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~1~ PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AND REVIEW REPORT OF INDEPENDENT ACCOUNTANTS SEPTEMBER 30, 2025 AND 2024 ------------------------------ ---------------------------------------------------------------- -------------------------------------- For the convenience of readers and for information purpose only, the auditors’ review report and the accompanying consolidated financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ review report and consolidated financial statements shall prevail.
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~2~ PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDA TED FINANCIAL STATEMENTS AND REVIEW REPORT OF INDEPENDENT ACCOUNTANTS AS OF SEPTEMBER 30, 2025 AND 2024 TABLE OF CONTENTS Contents Page 1. COVER PAGE 1 2. TABLE OF CONTENTS 2 ~ 3 3. INDEPENDENT AUDITORS’ REVIEW REPORT 4 ~ 5 4. CONSOLIDATED BALANCE SHEETS 6 ~ 7 5. CONSOLIDATED STA TEMENTS OF COMPREHENSIVE INCOME 8 6. CONSOLIDATED STA TEMENTS OF CHANGES IN EQUITY 9 7. CONSOLIDATED STA TEMENTS OF CASH FLOWS 10 8. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 11 ~ 51 (1) HISTORY AND ORGANIZATION 11 (2) THE DATE OF AUTHORIZA TION FOR ISSUANCE OF THE CONSOLIDATED FINANCIAL STA TEMENTS AND PROCEDURES FOR AUTHORIZA TION 11 (3) APPLICA TION OF NEW STANDARDS, AMENDMENTS AND INTERPRETA TIONS 11 ~ 12 (4) SUMMARY OF MATERIAL ACCOUNTING POLICIES 13 ~ 22 (5) CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND 22 ~ 23
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~3~ Contents Page KEY SOURCES OF ASSUMPTION UNCERTAINTY (6) DETAILS OF SIGNIFICANT ACCOUNTS 23 ~ 42 (7) RELATED PARTY TRANSACTIONS 42 (8) PLEDGED ASSETS 42 (9) SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT COMMITMENTS 42 (10) SIGNIFICANT DISASTER LOSS 42 (11) SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DA TE 43 (12) OTHERS 43 ~ 50 (13) ADDITIONAL DISCLOSURES REQUIRED BY THE SECURITIES AND FUTURES BUREAU 51 (14) SEGMENT INFORMATION 51
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~4~ REVIEW REPORT OF INDEPENDENT ACCOUNTANTS TRANSLATED FROM CHINESE To the Board of Directors and Shareholders of Parade Technologies, Ltd. Introduction We have reviewed the accompanying consolidated balance sheets of Parade Technologies, Ltd. and subsidiaries (the “Group”) as at September 30, 202 5 and 2024, and the related consolidated statements of comprehensive income for the three months and nine months then ended, and the related consolidated statements of changes in equity and of cash flows for the nine months then ended, and notes to the consolidated financial statement, including a summary of material accounting policies. Management is responsible f or the preparation and fair presentation of the consolidated financial statements in accordance with “Regulations Governing the Preparation of Financial Reports by Securities Issuers ” and International Accounting Standard 34, “Interim Financial Reporting”, that came into effect as endorsed by the Financial Supervisory Commission. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews. Scope of Review We conducted our reviews in accordance with the Standard on Review Engagements 2410, “Review of Financial Information Performed by the Independent Auditor of the Entity” of the Republic of China. A review of consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
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~5~ Conclusion Based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of the Group as at September 30, 2025 and 2024, and of its consolidated financial performance for the three months and nine months then ended and its consolidated cash flows for the nine months then ended in accordance with the “Regulations Governing the Preparation of Financial Reports Securities Issuers” and International Accounting Standard 34 , “Interim Financial Reporting” that came into effect as endorsed by the Financial Supervisory Commission. Lin, Kuan-Hung Chou, Hsiao-Tzu For and on behalf of PricewaterhouseCoopers, Taiwan October 29, 2025 ------------------------------------------------------------------------------------------------------------------------------- The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such consolidated financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and independent auditors’ review report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice. As the consolidated financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.
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PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2025, DECEMBER 31, 2024 AND SEPTEMBER 30, 2024 (Expressed in thousands of New Taiwan dollars) ~6~ September 30, 2025 December 31, 2024 September 30, 2024 ASSETS Notes Amount % Amount % Amount % Current assets 1100 Cash and cash equivalents 6(1) $ 9,802,985 40 $ 10,531,902 40 $ 9,650,152 39 1170 Accounts receivable, net 6(2) 1,837,871 8 1,564,455 6 1,713,915 7 130X Inventories, net 6(3) 3,227,886 13 3,982,669 15 3,490,868 14 1470 Other current assets 704,680 3 644,156 3 743,341 3 11XX Total current assets 15,573,422 64 16,723,182 64 15,598,276 63 Non-current assets 1600 Property, plant and equipment, net 6(4) 297,476 1 348,491 1 335,622 1 1755 Right-of-use assets 6(5) 369,504 2 323,076 1 269,463 1 1780 Intangible assets 6(6) 3,402,430 14 3,385,159 13 3,172,557 13 1840 Deferred income tax assets 6(18) 357,378 1 395,788 2 393,502 2 1900 Other non-current assets 6(7) 4,425,999 18 5,028,915 19 4,946,461 20 15XX Total non-current assets 8,852,787 36 9,481,429 36 9,117,605 37 1XXX TOTAL ASSETS $ 24,426,209 100 $ 26,204,611 100 $ 24,715,881 100 (Continued)
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PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2025, DECEMBER 31, 2024 AND SEPTEMBER 30, 2024 (Expressed in thousands of New Taiwan dollars) The accompanying notes are an integral part of these consolidated financial statements. ~7~ September 30, 2025 December 31, 2024 September 30, 2024 LIABILITIES AND EQUITY Notes Amount % Amount % Amount % Current liabilities 2170 Accounts payable $ 1,221,549 5 $ 1,321,038 5 $ 1,542,412 6 2200 Other payables 6(8) 776,459 3 1,641,273 6 810,539 3 2230 Current income tax liabilities 6(18) 414,940 2 364,626 1 385,147 2 2280 Lease liabilities - current 6(5) 126,887 1 125,574 1 110,505 - 2300 Other current liabilities 273,530 1 193,449 1 200,058 1 21XX Total current liabilities 2,813,365 12 3,645,960 14 3,048,661 12 Non-current liabilities 2580 Lease liabilities - non-current 6(5) 242,617 1 197,502 1 158,958 1 25XX Non-current liabilities 242,617 1 197,502 1 158,958 1 2XXX Total liabilities 3,055,982 13 3,843,462 15 3,207,619 13 Equity attributable to owners of the Company Share capital 6(11) 3110 Ordinary shares 800,578 3 811,601 3 811,610 3 Capital reserves 6(12) 3200 Capital surplus 3,271,537 14 4,169,642 16 4,189,121 17 Retained earnings 6(13) 3310 Legal reserve 1,011,400 4 1,011,400 4 1,011,400 4 3320 Special reserve 8,324 - 8,324 - 8,324 - 3350 Unappropriated earnings 17,437,447 71 15,979,468 61 15,860,503 64 Other equity 3400 Other equity 355,146 1 1,892,540 7 1,139,130 5 3500 Treasury shares 6(11) ( 1,514,205 ) ( 6 ) ( 1,511,826 ) ( 6 ) ( 1,511,826 ) ( 6 ) 31XX Equity attributable to owners of the Company 21,370,227 87 22,361,149 85 21,508,262 87 3XXX Total equity 21,370,227 87 22,361,149 85 21,508,262 87 Significant events after the balance sheet date 11 3X2X TOTAL LIABILITIES AND EQUITY $ 24,426,209 100 $ 26,204,611 100 $ 24,715,881 100
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PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 (Expressed in thousands of New Taiwan dollars, except for earnings per share amounts) The accompanying notes are an integral part of these consolidated financial statements. ~8~ Three months ended September 30 Nine months ended September 30 2025 2024 2025 2024 Items Notes Amount % Amount % Amount % Amount % 4000 Revenue 6(14) $ 4,377,025 100 $ 4,400,736 100 $ 12,643,058 100 $ 12,125,112 100 5000 Cost of goods sold 6(3)(16)(17) ( 2,516,771 ) ( 58 ) ( 2,529,059 ) ( 58 ) ( 7,242,360 ) ( 57 ) ( 6,960,530 ) ( 57 ) 5900 Gross profit 1,860,254 42 1,871,677 42 5,400,698 43 5,164,582 43 Operating expenses 6(16)(17) and 7 6100 Sales and marketing expenses ( 213,165 ) ( 5 ) ( 226,551 ) ( 5 ) ( 621,879 ) ( 5 ) ( 704,054 ) ( 6 ) 6200 General and administrative expenses ( 134,356 ) ( 3 ) ( 156,632 ) ( 3 ) ( 432,883 ) ( 4 ) ( 470,803 ) ( 4 ) 6300 Research and development expenses ( 700,435 ) ( 16 ) ( 734,893 ) ( 17 ) ( 2,167,740 ) ( 17 ) ( 2,202,540 ) ( 18 ) 6000 Total operating expenses ( 1,047,956 ) ( 24 ) ( 1,118,076 ) ( 25 ) ( 3,222,502 ) ( 26 ) ( 3,377,397 ) ( 28 ) 6900 Operating income 812,298 18 753,601 17 2,178,196 17 1,787,185 15 Non-operating income and expenses 7100 Interest income 73,982 2 95,014 2 206,376 2 265,706 2 7010 Other income 3,579 - 3,381 - 11,634 - 5,549 - 7020 Other gains and losses 6(15) ( 8,398 ) - 840 - ( 9,481 ) - 180 - 7000 Total non-operating income and expenses 69,163 2 99,235 2 208,529 2 271,435 2 7900 Income before income tax 881,461 20 852,836 19 2,386,725 19 2,058,620 17 7950 Income tax expense 6(18) ( 65,541 ) ( 1 ) ( 91,135 ) ( 2 ) ( 204,388 ) ( 2 ) ( 155,464 ) ( 1 ) 8000 Net income for the period from continuing operations 815,920 19 761,701 17 2,182,337 17 1,903,156 16 Other comprehensive income Components of other comprehensive income (loss) that will not be reclassified to profit or loss 8361 Other comprehensive income (loss), before tax, exchange differences on translation 814,878 18 ( 520,407 ) ( 12 ) ( 1,543,918 ) ( 12 ) 619,530 5 8360 Components of other comprehensive income (loss) that will not be reclassified to profit or loss 814,878 18 ( 520,407 ) ( 12 ) ( 1,543,918 ) ( 12 ) 619,530 5 8300 Other comprehensive income (loss) for the period $ 814,878 18 ( $ 520,407 ) ( 12 ) ( $ 1,543,918 ) ( 12 ) $ 619,530 5 8500 Total comprehensive income for the period $ 1,630,798 37 $ 241,294 5 $ 638,419 5 $ 2,522,686 21 Net income attributable to: 8610 Owners of the Company $ 815,920 19 $ 761,701 17 $ 2,182,337 17 $ 1,903,156 16 Comprehensive income attributable to: 8710 Owners of the Company $ 1,630,798 37 $ 241,294 5 $ 638,419 5 $ 2,522,686 21 Earnings per share 9750 Basic earnings per share 6(19) $ 10.45 $ 9.57 $ 27.63 $ 23.87 9850 Diluted earnings per share 6(19) $ 10.43 $ 9.54 $ 27.52 $ 23.76
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PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDA TED STA TEMENTS OF CHANGES IN EQUITY NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 (Expressed in thousands of New Taiwan dollars) Equity attributable to owners of the parent Capital Reserves Retained Earnings Other equity Notes Ordinary shares Paid-in capital in excess of ordinary shares Capital reserve from restricted stocks Capital reserve - others Legal reserve Special reserve Unappropriated earnings Currency translation differences of foreign operations Unearned compensation Treasury shares Total Equity The accompanying notes are an integral part of these consolidated financial statements. ~9~ For the nine months ended September 30, 2024 Balance at January 1, 2024 $ 811,636 $ 3,741,234 $ 220,709 $ 196,727 $ 1,011,400 $ 8,324 $ 14,581,792 $ 531,885 ( $ 109,750 ) ( $ 1,393,449 ) $ 19,600,508 Net income for the period - - - - - - 1,903,156 - - - 1,903,156 Other comprehensive income for the period - - - - - - - 619,530 - - 619,530 Total comprehensive income - - - - - - 1,903,156 619,530 - - 2,522,686 V esting of restricted stocks 6(10)(11) - 195,953 ( 195,953 ) - - - - - - - - Adjustment of turnover rate of restricted stocks - - ( 3,178 ) - - - - - 3,178 - - Cancellation of restricted stocks ordinary shares and related cash dividend recovered 6(11) ( 26 ) 1,620 26 - - - 244 - - - 1,864 Share-based compensation cost 6(10)(17) - 9,055 - - - - - - 94,287 - 103,342 Tax deduction exceeds cumulative share-based payment expenses - - - 22,928 - - - - - - 22,928 Purchase of treasury shares - - - - - - - - - ( 926,309 ) ( 926,309 ) Treasury shares reissued to employees 6(10)(11) - - - - - - - - - 807,932 807,932 Earnings appropriation Cash dividends - - - - - - ( 624,689 ) - - - ( 624,689 ) Balance at September 30, 2024 $ 811,610 $ 3,947,862 $ 21,604 $ 219,655 $ 1,011,400 $ 8,324 $ 15,860,503 $ 1,151,415 ( $ 12,285 ) ( $ 1,511,826 ) $ 21,508,262 For the nine months ended September 30, 2025 Balance at January 1, 2025 $ 811,601 $ 3,948,908 $ 20,532 $ 200,202 $ 1,011,400 $ 8,324 $ 15,979,468 $ 1,899,391 ( $ 6,851 ) ( $ 1,511,826 ) $ 22,361,149 Net income for the period - - - - - - 2,182,337 - - - 2,182,337 Other comprehensive loss for the period - - - - - - - ( 1,543,918 ) - - ( 1,543,918 ) Total comprehensive income (loss) - - - - - - 2,182,337 ( 1,543,918 ) - - 638,419 V esting of restricted stocks 6(10)(11) - 18,086 ( 18,086 ) - - - - - - - - Adjustment of turnover rate of restricted stocks - - ( 2,747 ) - - - - - 2,747 - - Cancellation of restricted stocks ordinary shares and related cash dividend recovered 6(11) ( 23 ) 2,282 23 - - - 251 - - - 2,533 Share-based compensation cost 6(10)(17) - ( 171,364 ) - - - - - - 3,777 - ( 167,587 ) Purchase of treasury shares - - - - - - - - - ( 1,497,643 ) ( 1,497,643 ) Cancellation of treasury shares ( 11,000 ) ( 726,299 ) - - - - - - - 737,299 - Treasury shares reissued to employees 6(10)(11) - - - - - - - - - 757,965 757,965 Cash dividends - - - - - - ( 724,609 ) - - - ( 724,609 ) Balance at September 30, 2025 $ 800,578 $ 3,071,613 ( $ 278 ) $ 200,202 $ 1,011,400 $ 8,324 $ 17,437,447 $ 355,473 ( $ 327 ) ( $ 1,514,205 ) $ 21,370,227
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PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 (Expressed in thousands of New Taiwan dollars) Nine months ended September 30 Notes 2025 2024 The accompanying notes are an integral part of these consolidated financial statements. ~10~ CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax for the period $ 2,386,725 $ 2,058,620 Adjustments Adjustments to reconcile profit (loss) Depreciation (including the right-of-use assets) 6(4)(5) 234,001 243,339 Amortization 6(6) 351,809 273,313 Loss on disposal of equipment 6(4) - 694 Loss on disposal of intangible assets 6(6) - 11,415 Share-based compensation cost 6(10)(17) 470,995 721,721 Interest income ( 206,376 ) ( 265,706 ) Changes in operating assets and liabilities Changes in operating assets Accounts receivable ( 385,061 ) ( 1,547 ) Inventories 470,567 398,435 Other current assets ( 736,072 ) ( 748,986 ) Changes in operating liabilities Accounts payable ( 5,216 ) ( 72,600 ) Accrued expenses ( 218,282 ) ( 203,433 ) Other current liabilities 93,886 ( 24,067 ) Cash inflow generated from operations 2,456,976 2,391,198 Interest received 206,376 265,706 Income tax paid ( 116,275 ) ( 96,164 ) Income tax received 118 1 Net cash flows from operating activities 2,547,195 2,560,741 CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of property, plant and equipment 6(4) ( 103,149 ) ( 85,510 ) Acquisition of intangible assets 6(6) ( 4,274 ) ( 8,874 ) Decrease in refundable deposits 6(7) 122,907 141,233 Increase in other prepayments ( 242,884 ) ( 493,499 ) Acquisition of business combinations 6(20) ( 292,410 ) - Net cash flows used in investing activities ( 519,810 ) ( 446,650 ) CASH FLOWS FROM FINANCING ACTIVITIES Cash dividends paid 6(13) ( 1,294,697 ) ( 1,015,560 ) Repayment of the principal portion of lease liabilities 6(5)(21) ( 94,012 ) ( 91,613 ) Purchase of treasury shares 6(11) ( 1,497,643 ) ( 926,309 ) Treasury shares reissued to employees 757,965 807,932 Cash dividend recovered from cancellation of share-based compensation 2,533 1,864 Net cash flows used in financing activities ( 2,125,854 ) ( 1,223,686 ) Effect of exchange rate changes ( 630,448 ) 272,146 Net (decrease) increase in cash and cash equivalents ( 728,917 ) 1,162,551 Cash and cash equivalents at beginning of period 10,531,902 8,487,601 Cash and cash equivalents at end of period $ 9,802,985 $ 9,650,152
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~11~ PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 (EXPRESSED IN THOUSANDS OF NEW TAIWAN DOLLARS, EXCEPT AS OTHERWISE INDICATED) 1. HISTORY AND ORGANIZATION Parade Technologies, Ltd. (the “Company”) was established in the Cayman Islands on November 15, 2005. The Company and its subsidiaries (collectively referred herein as the “Group”) are engaged in the research and development, and marketing and sale of high-speed interface standards, touch controller and display processing integrated circuit chips for products used in computers, consumer electronics and display panels. The shares of the Company were authorized by the Financial Supervisory C ommission, R.O.C. and h ave been traded on Taipei Exchange (formerly GreTai Securities Market) in the R .O.C. since September 13, 2011 (stock code: 4966). 2. THE DATE OF AUTHORIZATION FOR ISSU ANCE OF THE CONSOLIDA TED FINANCIAL STA TEMENTS AND PROCEDURES FOR AUTHORIZATION These consolidated financial statements were reported to the Board of Directors on October 29, 2025. 3. APPLICA TION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS (1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS ®”) Accounting Standards that came into effect as endorsed by the Financial Supervisory Commission (“FSC”) New standards, interpretations and amendments endorsed by the FSC and became effective from 2025 are as follows: The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. New Standards, Interpretations and Amendments Effective date by International Accounting Standards Board Amendments to IAS 21, ‘Lack of exchangeability’ January 1, 2025
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~12~ (2) Effect of new standards of or amendments to IFRS Accounting Standards as endorsed by the FSC but not yet adopted by the Group New standards, interpretations and amendments endorsed by the FSC effective from 2025 are as follows: The above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. (3) IFRS Accounting Standards issued by IASB but not yet endorsed by the FSC New standards, interpretations and amendments issued by IASB but not yet included in the IFRS Accounting Standards as endorsed by the FSC are as follows: Note：The FSC has announced in a press release on September 25, 2025 that public companies will apply IFRS 18 starting from the fiscal year 2028. Additionally, entities can choose to adopt IFRS 18 earlier based on their requirements after the FSC endorses IFRS 18. Except for the following, the above standards and interpretations have no significant impact to the Group’s financial condition and financial performance based on the Group’s assessment. IFRS 18, ‘Presentation and disclosure in financial statements’ IFRS 18, ‘Presentation and disclosure in financial statements’ replaces IAS 1. The standard introduces a defined structure of the statement of profit or loss, disclosure requirements related to management - defined performance measures, and enhanced principl es on aggregation and disaggregation which apply to the primary financial statements and notes. New Standards, Interpretations and Amendments Effective date by International Accounting Standards Board Specific provisions of Amendments to IFRS 9 and IFRS 7, ‘Amendments to the classification and measurement of financial instruments’ January 1, 2026 Amendments to IFRS 9 and IFRS 7, ‘Contracts referencing nature- dependent electricity’ January 1, 2026 IFRS 17, ‘Insurance contracts’ January 1, 2023 Amendments to IFRS 17, ‘Insurance contracts’ January 1, 2023 Amendment to IFRS 17, ‘Initial application of IFRS 17 and IFRS 9 – comparative information’ January 1, 2023 Annual Improvements to IFRS Accounting Standards—Volume 11 January 1, 2026 New Standards, Interpretations and Amendments Effective date by International Accounting Standards Board Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of assets between an investor and its associate or joint venture’ To be determined by International Accounting Standards Board IFRS 18, ‘Presentation and disclosure in financial statements’ January 1, 2027 (Note) IFRS 19, ‘Subsidiaries without public accountability: disclosures’ January 1, 2027
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~13~ 4. SUMMARY OF MATERIAL ACCOUNTING POLICIES The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated. (1) Compliance statement The consolidated financial statements of the Group have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Accounting Standard 34, ‘Interim financial reporting’ that came into effect as endorsed by the FSC. (2) Basis of preparation A. The consolidated financial statements have been prepared under the historical cost convention. B. The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC ® Interpretations, and SIC ® Interpretations that came into effect as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5. (3) Basis of consolidation A. Basis for preparation of consolidated financial statements: (a) All subsidiaries are included in the Group’s consolidated financial statements. Subsidiaries are all entities (including structured entities) controlled by the Group. The Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries. (b) Inter-company transactions, balances and unreali zed gains or losses on transactions between companies within the Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Group. (c) Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non -controlling interests. Total comprehensive income is attributed to the owners of the parent and to the non-controlling interests even if this results in the non - controlling interests having a deficit balance.
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~14~ B. Subsidiaries included in the consolidated financial statements: C. Subsidiaries not included in the consolidated financial statements: None. D. Adjustments for subsidiaries with different balance sheet dates: None. E. Significant restrictions: None. (4) Foreign currency translation Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The Company’s functional currency is US Dollars; however, the consolidated financial statements are presented in New Taiwan Dollars under the regulations of the Republic of China where the consolidated financial statements are reported to the regulatory authorities. A. Foreign currency transactions and balances (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise. Investor Subsidiary Main business activities September 30, 2025 December 31, 2024 September 30, 2024 Description Parade Technologies, Ltd. Parade Technologies, Inc. Providing sales and marketing, general and administrative, and research and development services to the Company 100 100 100 - Parade Technologies, Ltd. Parade Technologies Korea, Ltd. Providing sales and marketing, general and administrative services to the Company 100 100 100 - Parade Technologies, Ltd. Parade Technologies, Ltd. (Nanjing) Providing research and development services to the Company 100 100 100 - Parade Technologies, Ltd. Pinchot Ltd. Providing administrative services to the Company 100 100 100 - Parade Technologies, Ltd. Parade Technologies, Ltd. (Chongqing) Providing research and development services to the Company 100 100 100 - Parade Technologies, Inc. Parade Technologies, Inc. (Shanghai) Providing research and development services to the Company 100 100 100 - Ownership (%)
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~15~ (b) Monetary assets and liabilities denominated in foreign currencies at the period end are re - translated at the exchange rates prevail ing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognized in profit or loss. (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re -translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, non-monetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions. (d) All foreign exchange gains and losses are presented in the statement of comprehensive income within ‘other gains and losses’. B. Translation of foreign operations The operating results and financial position of all the group entities, associates and jointly controlled entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (a) Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet; (b) Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and (c) All resulting exchange differences are recognized in other comprehensive income. (5) Classification of current and non-current items A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets: (a) Assets that are expected to be realized, or are intended to be sold or consumed in the normal operating cycle; (b) Assets that are held primarily for the purpose of trading; (c) Assets that are expected to be realised within twelve months after the reporting period; (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to settle liabilities for at least twelve months after the reporting period. B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities: (a) Liabilities that are expected to be settled in the normal operating cycle; (b) Liabilities that are held primarily for the purpose of trading; (c) Liabilities that are due to be settled within twelve months after the reporting period; (d) It does not have the right at the end of the reporting period to defer settlement of the liability at least twelve months after the reporting period.
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~16~ (6) Cash equivalents Cash equivalents refer to short -term highly liquid investments that are readily convertible to known amount of cash and subject to an insignificant risk of changes in value. Treasury bills that meet the definition above and are held for the purpose of meeting short -term cash commitments in operations are classified as cash equivalents. (7) Accounts receivable A. Accounts receivable entitles the Group to a legal right to receive consideration in exchange for transferred goods. B. The short-term accounts receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial. (8) Impairment of financial assets For financial assets at amortised cost including accounts receivable or contract assets that have a significant financing component, at each reporting date, the Group recognises the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognises the impairment provision for the lifetime expected credit losses (“ECLs”) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Group recognises the impairment provision for lifetime ECLs. (9) Derecognition of financial assets The Group derecognizes a financial asset when the contractual rights to receive cash flows from the financial asset expire. (10) Inventories Inventories are stated at the lower of cost and net realizable value. Cost is determined using the standard cost method. The cost of finished goods and work in process comprises raw materials, other direct costs and related production overheads. The item-by-item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and the estimated costs necessary to make the sale. (11) Property, plant and equipment A. Equipment is initially recorded at cost. B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.
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~17~ C. Equipment applies cost model and is depreciated using the straight-line method to allocate its cost over its estimated useful live. Each part of an item of equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately. D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘ Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives of equipment are as follows: Machinery and equipment 3 ~ 5 years Office equipment 3 ~ 5 years Leasehold improvements 2 ~ 5 years (12) Leasing arrangements (lessee)－right-of-use assets / lease liabilities A. Leases are recognised as a right -of-use assets and a corresponding lease liability at the date at which the leased asset is available for use by the Group. For short -term leases or leases of low - value assets, lease payments are recognised as an expense o n a straight-line basis over the lease term. B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of the fixed payments, less any lease incentives receivable. The Group subsequently measures the lease liability at amortised cost using the interest method and recognises interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognised as an adjustment to the right-of-use assets when there are changes in the lease term or lease payments and such changes do not arise from contract modifications. C. At the commencement date, the right-of-use assets is stated at cost comprising the following: (a) The amount of the initial measurement of lease liability; (b) Any lease payments made at or before the commencement date; and (c) Any initial direct costs incurred by the lessee. The right-of-use assets is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognised as an adjustment to the right-of-use assets. D. For lease modifications that decrease the scope of the lease, the lessee shall decrease the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease, and recognise the difference between remeasured lease liability in profit or loss. For all other lease modifications, the lessee shall remeasure the lease liability and adjust the right-of-use asset, correspondingly.
Page 18
~18~ (13) Intangible assets A. Computer software Computer software is stated at cost and amortized on a straight-line basis over its estimated useful life of 3 to 5 years. B. Goodwill Goodwill arises in a business combination accounted for by applying the acquisition method. C. Mask Mask is stated at cost and amortized on a straight-line basis over its estimated useful life of 3 years. D. Patent and other intangible assets Separately acquired intangible assets are stated at historical cost. Intangible assets acquired in a business combination are recognised at fair value at the acquisition date. Related intangible assets have a finite useful life and are amortised on a straight-line basis over their estimated useful lives of 7 to 10 years. (14) Impairment of non-financial assets A. The Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. Except for goodwill , w hen the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortised historical cost would have been if the impairment had not been recognised. B. The recoverable amounts of goodwill are evaluated periodically. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. Impairment loss of goodwill previously recognized in profit or loss shall not be reversed in the following years. C. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash -generating units, or groups of cash -generating units, that is/are expected to benefit from the synergies of the business combination. Each u nit or group of units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level. (15) Accounts payable A. Accounts payable are liabilities for purchases of raw materials, goods or services. B. The short -term accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.
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~19~ (16) Employee benefits A. Short-term employee benefits Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognised as expense in that period when the employees render service. B. Pensions Each subsidiary of the Group adopts defined contribution pension plan in accordance with local regulations. The contributions are recognized as pension expense when they are due on an accrual basis. C. Employees’ compensation and Directors’ remuneration Employees’ compensation and Directors’ remuneration are recognized as expense and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employees’ compensation is distributed by shares, the Group calculates the number of shares based on the closing price at the previous day of the Board meeting resolution. (17) Employee share-based payment A. For the equity-settled share-based compensation arrangements, the employee services received are measured at the fair value of the equity instruments granted at the grant date and are recognized as compensation cost over the vesting period, with a corresponding adjustment to equity. The fair value of the equity instruments granted shall reflect the impact of market vesting conditions and non-market vesting conditions. Compensation cost is subject to adjustment based on the service conditions that are expected to be satisfied and the estimates of the number of equity instruments that are expected to ve st under the non -market vesting conditions at each balance sheet date. Ultimately, the amount of compensation cost recognized is based on the number of equity instruments that eventually vest. B. Restricted stocks: (a) Restricted stocks issued to employees are measured at the fair value of the equity instruments granted at the grant date and are recognized as compensation cost over the vesting period. (b) For restricted stocks where those stocks do not restrict distribution of dividends to employees. However, employees must return the dividends received if they resign before the vesting conditions are fully satisfied. When receiving dividend s, the Group credits related amounts that were previously debited from retained earnings, legal reserve or capital reserve at the date of dividends declaration.
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~20~ (c) For restricted stocks where employees do not need to pay to acquire those stocks. However, when employees resign before the vesting conditions are fully satisfied, the Group will redeem the restricted stocks without consideration and then retire them. After the restricted stocks were retired, the Group decreased ‘Ordinary shares’ and increased ‘Capital reserve from restricted stocks’. (18) Income tax A. The tax expense for the year comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recogni zed in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity. B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. C. Deferred income tax is recogni zed, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred income tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized, or the deferred income tax liability is settled. D. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utili zed. At each balance sheet date, unrecognized and recognized deferred income tax assets are reassessed. E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or reali ze the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously. F. A deferred tax asset shall be recognized for the carryforward of unused tax credits resulting from research and development expenditures to the extent that it is possible that future taxable profit will be available against which the unused tax credits can be utilized.
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~21~ G. The interim period income tax expense is recognised based on the estimated average annual effective income tax rate expected for the full financial year applied to the pretax income of the interim period, and the related information is disclosed accordingly. H. If a change in tax rate is enacted or substantively enacted in an interim period, the Group recognizes the effect of the change immediately in the interim period in which the change occurs. The effect of the change on items recognised outside profit or loss is recognised in other comprehensive income or equity while the effect of the change on items recognised in profit or loss is recognized in profit or loss. (19) Share capital A. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds. B. Where the Company repurchases the Company’s equity share capital that has been issued , the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the Company’s equity holders. Where such shares are subsequently reissued, the difference between their book value and any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the Company’s equity holders. (20) Dividends Cash dividends are recorded as liabilities in the Company’s financial statements in the period in which they are resolved by the Board of Directors. Stock dividends are recorded as stock dividends to be distributed in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders and are reclassified to ordinary shares on the effective date of new shares issuance. (21) Revenue recognition A. The Group designs and sells high-speed interfacing chips, touch and serial products of DisplayPort. Sales are recognised when control of the products has transferred, being when the products are delivered to the customer, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. The risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Group has objective evidence that all criteria for acceptance have been satisfied. B. Revenue from these sales is recognised based on the price specified in the contract. Other current liability is recognised for expected price rebate payable to customers in relation to sales made until the end of the reporting period. The sales usually are made with a credit term of 30 to 60 days. As the time interval between the transfer of committed goods or service and the payment of customer does not exceed one year, the Group does not adjust the transaction price to reflect the time value of money.
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~22~ C. A receivable is recognised when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due. (22) Business combinations A. The Group uses the acquisition method to account for business combination s. The consideration transferred for an acquisition is measured as the fair value of the assets transferred, liabilities incurred or assumed, and equity instruments issued at the acquisition date, plus the fair value of any assets and liabilities resulting fr om a contingent consideration arrangement. All acquisition- related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. For each business combination, the Group measures at the acquisition date components of non -controlling interests in the acquiree that are present ownership interests and entitle their holders to the proportionate share of the entity ’s net assets in the event of liquidation at either fair value or the present ownership instruments ’ proportionate share in the recognized amounts of the acquiree ’s identifiable net assets. All o ther non -controlling interests should be measured at the acquisition-date fair value. B. The excess of the consideration transferred, the amount of any non -controlling interest in the acquiree and the fair value of any previous equity interest in the acquiree over the fair value of the identifiable assets acquired and the liabilities assumed is recorded as goodwill at the acquisition date. If the total of consideration transferred, non -controlling interest in the acquiree recognized and the fair value of previously held equity interest in the acquiree is less than the fair value of the identifiable assets acquired and the liabilities assumed, the difference is recognized directly in profit or loss on the acquisition date. (23) Operating segments Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision-Maker. The Group’s Chief Operating Decision-Maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions. 5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY The preparation of these consolidated financial statements requires management to make c ritical judgements in applying the Group’s accounting policies and make critical assumptions and e stimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year; and the related information is addressed below:
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~23~ (1) Critical judgements in applying the Group’s accounting policies None. (2) Critical accounting estimates and assumptions A. Impairment assessment of goodwill The impairment assessment of goodwill relies on the Group’s subjective judgement, including identifying cash-generating units, allocating assets and liabilities as well as goodwill to related cash- generating units, and determining the recoverable amounts of related cash-generating units. As of September 30, 2025, the Group recognized goodwill amounting to $2,409,371. B. Evaluation of inventories As inventories are stated at the lower of cost and net realizable value, the Group must determine the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technological innovation, the Group evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date and writes down the cost of inventories to the net realizable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation. As of September 30, 2025, the carrying amount of inventories was $3,227,886. 6. DETAILS OF SIGNIFICANT ACCOUNTS (1) Cash and cash equivalents A. The Group transacts with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote. B. The Group has no cash and cash equivalents pledged to others. (2) Accounts receivable 0 September 30, 2025 December 31, 2024 September 30, 2024 Cash on hand 36$ 36$ 37$ Checking accounts and bank deposits 3,059,860 3,317,135 2,671,224 3,059,896 3,317,171 2,671,261 Cash equivalents Treasury bills 6,743,089 7,214,731 6,978,891 9,802,985$ 10,531,902$ 9,650,152$ September 30, 2025 December 31, 2024 September 30, 2024 Accounts receivable 1,837,871$ 1,564,455$ 1,713,915$ Less: Allowance for doubtful accounts - - - 1,837,871$ 1,564,455$ 1,713,915$
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~24~ A. The ageing analysis of accounts receivable that were past due but not impaired is as follows: The above ageing analysis was based on past due date. B. As of September 30, 2025, December 31, 2024 and September 30, 2024, accounts receivable were all from contracts with customers. And as of January 1, 202 4, the balance of receivables from contracts with customers amounted to $1,661,511. C. As of September 30, 2025, December 31, 2024 and September 30, 2024, without taking into account any collateral held or other credit enhancements, the maximum exposure to credit risk in respect of the amount that best represents the Group’s accounts receivable w ere $1,837,871, $1,564,455 and $1,713,915, respectively. D. Information relating to credit risk of accounts receivable is provided in Note 12(3). (3) Inventories 0 September 30, 2025 December 31, 2024 September 30, 2024 Not past due 1,747,247$ 1,520,839$ 1,623,992$ 60 days 90,624 43,616 89,923 90 days - - - 91-180 days - - - 181-360 days - - - over 360 days - - - 1,837,871$ 1,564,455$ 1,713,915$ Cost Allowance Book value Raw materials 1,792,523$ 397,167)($ 1,395,356$ Work-in-process 1,110,178 77,484)( 1,032,694 Finished goods 897,198 97,362)( 799,836 3,799,899$ 572,013)($ 3,227,886$ Cost Allowance Book value Raw materials 2,368,376$ 472,875)($ 1,895,501$ Work-in-process 1,161,379 101,459)( 1,059,920 Finished goods 1,126,779 99,531)( 1,027,248 4,656,534$ 673,865)($ 3,982,669$ Cost Allowance Book value Raw materials 2,181,456$ 484,117)($ 1,697,339$ Work-in-process 1,213,452 62,737)( 1,150,715 Finished goods 737,780 94,966)( 642,814 4,132,688$ 641,820)($ 3,490,868$ September 30, 2024 December 31, 2024 September 30, 2025
Page 25
~25~ The cost of inventories recognised as expense for the period: The Company reversed a previous inventory write-down and accounted for as reduction of cost of goods sold because inventories were subsequently scrapped or sold for the three months and nine months ended September 31, 2025 and 2024. (4) Property, plant and equipment The Group had no property and plant as of September 30, 2025, December 31, 2024, and September 30, 2024. 2025 2024 Cost of goods sold 2,498,048$ 2,516,667$ Gain on reversal of market value 30,440)( 45,392)( Others 49,163 57,784 2,516,771$ 2,529,059$ 2025 2024 Cost of goods sold 7,130,539$ 6,847,446$ Gain on reversal of market value 54,330)( 60,471)( Others 166,151 173,555 7,242,360$ 6,960,530$ For the three months ended September 30, For the nine months ended September 30, Machinery Office Leasehold 0 and equipment equipment improvements Total At January 1, 2025 Cost 1,543,216$ 86,347$ 178,690$ 1,808,253$ Accumulated depreciation 1,233,530)( 73,814)( 152,418)( 1,459,762)( 309,686$ 12,533$ 26,272$ 348,491$ Nine months ended September 30, 2025 Opening net book amount 309,686$ 12,533$ 26,272$ 348,491$ Additions 99,133 3,663 353 103,149 Acquired from business combinations 3,491 67 - 3,558 Depreciation charge 124,119)( 5,571)( 10,299)( 139,989)( Net exchange differences 16,898)( 328)( 507)( 17,733)( Closing net book amount 271,293$ 10,364$ 15,819$ 297,476$ At September 30, 2025 Cost 1,547,903$ 84,007$ 170,258$ 1,802,168$ Accumulated depreciation 1,276,610)( 73,643)( 154,439)( 1,504,692)( 271,293$ 10,364$ 15,819$ 297,476$
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~26~ The above equipment is for self-use. (5) Leasing arrangements－lessee A. The Group leases offices. Rental contracts are typically made for periods of 1 to 6 years. Lease terms are negotiated on an individual basis an d contain a wide range of different terms and conditions. The lease agreements do not impose covenants, but leased assets may not be used as security for borrowing purposes. B. The carrying amount of right-of-use assets and the depreciation charge are as follows: C. For the nine months ended September 30, 2025 and 2024, the additions to right-of-use assets were $156,848 and $94,982, respectively. Machinery Office Leasehold 0 and equipment equipment improvements Total At January 1, 2024 Cost 1,361,384$ 77,353$ 159,357$ 1,598,094$ Accumulated depreciation 1,006,421)( 65,245)( 134,327)( 1,205,993)( 354,963$ 12,108$ 25,030$ 392,101$ Nine months ended September 30, 2024 Opening net book amount 354,963$ 12,108$ 25,030$ 392,101$ Additions 63,444 7,073 14,993 85,510 Disposals - 66)( 628)( 694)( Depreciation charge 134,968)( 6,151)( 10,607)( 151,726)( Net exchange differences 9,855 163 413 10,431 Closing net book amount 293,294$ 13,127$ 29,201$ 335,622$ At September 30, 2024 Cost 1,463,295$ 85,112$ 175,395$ 1,723,802$ Accumulated depreciation 1,170,001)( 71,985)( 146,194)( 1,388,180)( 293,294$ 13,127$ 29,201$ 335,622$ September 30, 2025 December 31, 2024 September 30, 2024 Carrying amount Carrying amount Carrying amount Offices 369,504$ 323,076$ 269,463$ 2025 2024 Depreciation Depreciation Offices 27,126$ 28,351$ 2025 2024 Depreciation Depreciation Offices 94,012$ 91,613$ For the nine months ended September 30, For the three months ended September 30,
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~27~ D. The information on profit and loss accounts relating to lease contracts is as follows: E. For the nine months ended September 30, 2025 and 2024, the Group’s total cash outflow for leases amounted to $95,815 and $93,546, respectively. (6) Intangible assets Items affecting profit or loss 2025 2024 Expense on short-term lease contracts 574$ 616$ Items affecting profit or loss 2025 2024 Expense on short-term lease contracts 1,803$ 1,933$ For the nine months ended September 30, For the three months ended September 30, Patent Software Goodwill Mask and others Total At January 1, 2025 Cost 129,162$ 2,489,729$ 1,881,445$ 1,855,914$ 6,356,250$ Accumulated amortization 93,720)( - 1,300,309)( 1,577,062)( 2,971,091)( 35,442$ 2,489,729$ 581,136$ 278,852$ 3,385,159$ Nine months ended September 30, 2025 Opening net book amount 35,442$ 2,489,729$ 581,136$ 278,852$ 3,385,159$ Inward transfer - - 356,038 - 356,038 Additions - acquired separately 4,274 - - - 4,274 Additions - acquired through business combinations - 103,837 15,869 147,018 266,724 Amortization charge 9,892)( - 237,323)( 104,594)( 351,809)( Net exchange differences 1,814)( 184,195)( 45,395)( 26,552)( 257,956)( Closing net book amount 28,010$ 2,409,371$ 670,325$ 294,724$ 3,402,430$ At September 30, 2025 Cost 125,148$ 2,409,371$ 2,109,309$ 1,861,256$ 6,505,084$ Accumulated amortization 97,138)( - 1,438,984)( 1,566,532)( 3,102,654)( 28,010$ 2,409,371$ 670,325$ 294,724$ 3,402,430$
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~28~ A. Details of amortization of intangible assets are as follows: B. Goodwill is allocated to the Group’s cash -generating units identified according to operating segment. The Group is identified as one cash-generating unit. The recoverable amount of all cash- generating units has been determined based on value -in-use calculations. These calculations use pre-tax cash flow projections based on financial budgets approved by the management covering a five-year period. Patent Software Goodwill Mask and others Total At January 1, 2024 Cost 111,090$ 2,331,796$ 1,295,306$ 1,738,186$ 5,476,378$ Accumulated amortization 74,914)( - 1,053,734)( 1,321,938)( 2,450,586)( 36,176$ 2,331,796$ 241,572$ 416,248$ 3,025,792$ Nine months ended September 30, 2024 Opening net book amount 36,176$ 2,331,796$ 241,572$ 416,248$ 3,025,792$ Inward transfer - - 330,740 - 330,740 Additions - acquired separately 8,874 - - - 8,874 Amortization charge 11,512)( - 140,487)( 121,314)( 273,313)( Disposals - - 11,415)( - 11,415)( Net exchange differences 1,053 71,373 5,272 14,181 91,879 Closing net book amount 34,591$ 2,403,169$ 425,682$ 309,115$ 3,172,557$ At September 30, 2024 Cost 123,241$ 2,403,169$ 1,619,823$ 1,791,390$ 5,937,623$ Accumulated amortization 88,650)( - 1,194,141)( 1,482,275)( 2,765,066)( 34,591$ 2,403,169$ 425,682$ 309,115$ 3,172,557$ 2025 2024 Operating costs 79,752$ 49,781$ Research and development expenses 24,050 43,484 Selling expenses 275 319 Administrative expenses 34 71 104,111$ 93,655$ 2025 2024 Operating costs 237,351$ 140,524$ Research and development expenses 113,378 131,524 Selling expenses 911 1,037 Administrative expenses 169 228 351,809$ 273,313$ For the three months ended September 30, For the nine months ended September 30,
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~29~ The recoverable amount of the cash-generating unit calculated using the value-in-use exceeded their carrying amount, so goodwill was not impaired. The key assumptions used for value -in-use calculations are budgeted gross margin, weighted average growth rates, and discount rates. Management determined budgeted gross margin based on past performance and its expectations of market development. The weighted average growth rates used are consistent with the forecasts included in industry reports. The discount rates used are pre-tax and reflect specific risks relating to the relevant operating segments. (7) Other non-current assets The refundable deposits resulted from a Letter of Intent with its key supplier. The Company has strengthened its cooperative relationship with the key supplier and obtained capacity support to meet the Company's future operating needs. (8) Other payables (9) Pensions Each subsidiary adopts a funded defined contribution pension plan in accordance with local regulations. Under the pension plan, subsidiaries contribute monthly an amount to an independent fund. Other than the monthly contributions, the Group has no further obligations. The pension costs under the defined contribution pension plans of the Group for the three months and nine months ended September 30, 2025 and 2024 were $39,910, $41,529, $128,438 and $128,510, respectively. September 30, 2025 December 31, 2024 September 30, 2024 Refundable deposits 3,755,517$ 4,176,470$ 4,033,834$ Prepaid mask 670,482 852,445 912,627 4,425,999$ 5,028,915$ 4,946,461$ 0 September 30, 2025 December 31, 2024 September 30, 2024 Dividends payable -$ 570,088$ -$ Payroll, bonus and accrued vacation 442,880 624,668 458,897 Employees’ compensation and Directors’ remuneration 210,341 266,270 192,729 Commissions 28,107 40,578 49,404 Legal and professional fees 22,732 24,908 26,723 Engineering expenses 17,970 21,665 14,061 Others 54,429 93,096 68,725 776,459$ 1,641,273$ 810,539$
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~30~ (10) Share-based payment A. For the nine months ended September 30, 2025 and 2024 , the Group’s share -based payment arrangements were as follows: Note: Restrictions before the vesting conditions are fully satisfied are as follows: (a) The grantee employee shall not sell, transfer, make gift of, create other rights or encumbrances on the restricted stocks awards (the “RSAs”), or otherwise dispose of the RSAs in any other manner. (b) All the proposal rig hts, motion rights, speech rights , voti ng rights and any other Quantity granted Contract Vesting Type of arrangement Grant date (in thousands) period conditions Treasury stock transferred to employees Feb. 8, 2023 94 1 year 1 year service Treasury stock transferred to employees Feb. 8, 2023 184 1 year 1 year service Treasury stock transferred to employees Apr. 26, 2023 52 Vested immediately Treasury stock transferred to employees Apr. 26, 2023 386 1 year 1 year service Treasury stock transferred to employees Feb. 7, 2024 98 1 year 1 year service Treasury stock transferred to employees Feb. 7, 2024 283 1 year 1 year service Treasury stock transferred to employees Apr. 24, 2024 470 1 year 1 year service Treasury stock transferred to employees Feb. 5, 2025 96 1 year 1 year service Treasury stock transferred to employees Feb. 5, 2025 376 1 year 1 year service Treasury stock transferred to employees Apr. 23, 2025 485 1 year 1 year service Treasury stock transferred to employees Apr. 23, 2025 0.1 1 year 1 year service Treasury stock transferred to employees Aug. 6, 2025 0.3 1 year 1 year service Restricted stocks to employees (Note) Feb. 12, 2020 9 4 years 4 years service Restricted stocks to employees (Note) Apr. 29, 2020 45 4 years 4 years service Restricted stocks to employees (Note) Jul. 29, 2020 709 4 years 4 years service Restricted stocks to employees (Note) Oct. 28, 2020 5 4 years 4 years service Restricted stocks to employees (Note) Feb. 3, 2021 8 4 years 4 years service Restricted stocks to employees (Note) Apr. 28, 2021 78 4 years 4 years service
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~31~ shareholder rights shall be exercised by the trustee or the custodian. (c) The restrictions (including but not limited to transfer restrictions and vesting conditions) applicable to any and all unvested RSAs (and any share derived from such RSAs for whatever reason, including share dividend, retained earnings capitalization, recapitalization, reserve capitalization and any cash distributed based on such RSAs for whatever reason, including cash dividend and distribution of capital reserve in the form of cash) shall equally apply to any share derived, directly or indirectly, from and cash distributed based on such unvested RSAs for whatever reason, including share dividend, retained earnings capitalization, recapitalization, reserve capitalization, cash dividend and distribution of capital reserve in the form of cash, and any interests. B. Please see Note 6(1 1) for the related information about the fair value of restricted stocks to employees issued by the Company. C. The Company reissued 307, 63 and 11 thousand treasury shares with repurchase price amounting to $237,537, $127,257 and $13,268, respectively, to its employees with the effective date set on February 7, 2024 in accordance with the Share Repurchase and Emplo yee Incentive Plan. The subscription price of $773.74 (in dollars), $2,037.28 (in dollars) and $1,202.11 (in dollars) per share equals the average repurchase price per share. The fair value of the treasury shares reissued was measured based on the market price at the grant date. D. The Company reissued 418 and 52 thousand treasury shares with repurchase price amounting to $323,268 and $106,602, respectively, to its employees with the effective date set on April 24, 2024 in accordance with the Share Repurchase and Employee Incentive Plan. The subscription price of $773.74 (in dollars) and $2,037.28 (in dollars) per share equals the average repu rchase price per share. The fair value of the treasury shares reissued was measured based on the market price at the grant date. E. The Company reissued 472 thousand treasury shares with repurchase price amounting to $365,679, to its employees with the effective date set on February 5, 2025 in accordance with the Share Repurchase and Employee Incentive Plan. The subscription price of $773.74 (in dollars) and per share equals the average repurchase price per share. The fair value of the treasury shares reissued was measured based on the market price at the grant date. F. The Company reissued 241 and 244 thousand treasury shares with repurchase price amounting to $186,529 and $205,472, respectively, to its employees with the effective date set on April 23, 2025 in accordance with the Share Repurchase and Employee Incentive Plan. The subscription price of $773.74 (in dollars) and $842.1 (in dollars) per share equals the average repurchase price per share. The fair value of the treasury shares reissued was measured based on the market price at the grant date.
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~32~ G. The Company reissued 0.3 thousand treasury shares with repurchase price amounting to $ 285, to its employees with the effective date set on August 7 , 202 5 in accordance with the Share Repurchase and Employee Incentive Plan. The subscription price of $842.1 (in dollars) per share equals the average repurchase price per share. The fair value of the treasury shares reissued was measured based on the market price at the grant date. H. Expenses incurred on share-based payment transactions are shown below: (11) Share capital/ Treasury shares A. As of September 30, 2025, the Company’s authorized capital was $ 1,500,000, consisting of 150 million shares of ordinary stock, and the paid-in capital was $800,578 with a par value of $10 (in dollars) per share. All proceeds from shares issued have been collected. Movements in the number of the Company’s ordinary shares outstanding are as follows (in thousands of shares, and excluding treasury shares): 2025 2024 Equity-settled 157,323$ 200,710$ 2025 2024 Equity-settled 470,995$ 721,721$ For the three months ended September 30, For the nine months ended September 30, Unrestricted Restricted shares shares Treasury shares Total At January 1 81,144 15 1,856)( 79,303 Vesting of restricted stocks 13 13)( - - Cancellation of restricted stocks ordinary shares - 2)( - 2)( Purchase of treasury shares - - 2,200)( 2,200)( Treasury stock reissued to employees - - 958 958 Cancellation of treasury stock 1,100)( - 1,100 - At September 30 80,057 - 1,998)( 78,059 For the nine months ended September 30, 2025 Unrestricted Restricted shares shares Treasury shares Total At January 1 80,962 201 1,607)( 79,556 Vesting of restricted stocks 182 182)( - - Cancellation of restricted stocks ordinary shares - 3)( - 3)( Purchase of treasury shares - - 1,100)( 1,100)( Treasury stock reissued to employees - - 851 851 At September 30 81,144 16 1,856)( 79,304 For the nine months ended September 30, 2024
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~33~ B. The Board of Directors during its meetings on July 29, 2020, October 28, 2020, February 3, 2021 and April 28, 2021 adopted a resolution to issue employee restricted ordinary shares (see Note 6(10)) with the effective date set on July 29, 2020, October 28, 2020, February 3, 2021 and April 28, 2021. Each share will be issued without consideration. The decision on the fair value was based on the closing prices of $1,095, $1,130, $1,270 and $1,260 (in dollars), respectively, at the grant date. The employee restricted ordinary shares issued are subject to stockholders’ right restrictions, please see Note 6(10) for details. Other than these restrictions, the rights and obligations of these shares issued are the same as other issued ordinary shares. Due to emplo yee termination, reacquired share capital is $658 as of September 30, 2025, and there is no unretired share capital. C. The Board of Directors during its meetings on February 12, 2020 and April 29, 2020 adopted a resolution to issue employee restricted ordinary shares (see Note 6(10)) with the effective date set on February 12, 2020 and April 29, 2020, respectively. Each share will be issued without consideration. The decision on the fair value was based on the closing prices of $691 and $728 (in dollars), respectively, at the grant date. The employee restricted ordinary shares issued are subject to stockholders’ right restrictions, please see Note 6(10) for details. Other than these restrictions, the rights and obligations of these shares issued are the same as other issued ordinary shares. Due to employee termination, reacquired share capital is $68 as of September 30, 2025, and there is no unretired share capital. D. Treasury shares (a) Reason for share reacquisition and movements in the number of the Company’s treasury shares are as follows: (b) Pursuant to the R.O.C. Securities and Exchange Act, the number of shares bought back as treasury share should not exceed 10% of the number of the Company’s issued and outstanding shares and the amount bought back should not exceed the sum of retained earni ngs, paid-in capital in excess of par value and realised capital surplus. (c) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should not be pledged as collateral and is not entitled to dividends before it is reissued. Name of company Number of shares holding the shares Reason for reacquisition (in thousands) Carrying amount The Company To be reissued to employees 1,998 1,514,205$ Name of company Number of shares holding the shares Reason for reacquisition (in thousands) Carrying amount The Company To be reissued to employees 1,856 1,511,826$ Name of company Number of shares holding the shares Reason for reacquisition (in thousands) Carrying amount The Company To be reissued to employees 1,856 1,511,826$ September 30, 2025 December 31, 2024 September 30, 2024
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~34~ (d) Pursuant to the R.O.C. Securities and Exchange Act, treasury shares should be reissued to the employees within five years from the reacquisition date and shares not reissued within the five- year period are to be retired. Treasury shares to enhance the Company’s credit rating and the stockholders’ equity should be retired with six months of acquisition. (e) The Company repurchased 2,200 thousand shares of the Company’s stock for the period from February 10, 2025 to March 27, 2025, at a total cost of $1,497,643. (f) The Board of Directors resolved to cancel 1,100 thousand treasury shares, amounting to $737,299. The treasury shares held on April 23, 2025, which had been approved by the Taiwan Stock Exchange Corporation on April 29, 2025, have been cancelled. (12) Capital reserves In accordance with the provisions of the Articles of Association and with the approval of the shareholders at the Annual General Meeting, the Board of Directors may capitalize any amount within the capital reserve acco unt, including capital reserve - additional paid -in capital and capital redemption reserve. Further, the R.O.C. Securities and Exchange Act requires that the amount of capital reserve to be capitalized mentioned above should not exceed 10% of the paid -in capital each year. Capital reserve shou ld not be used to cover accumulated deficit unless the legal reserve is insufficient. (13) Retained earnings A. The Company passed the amendments to the Articles of Association by resolution of the shareholders’ meeting held on June 15, 2020. At the close of each of the half fiscal year, the Board may resolve to distribute profits or allocate losses; provided, howev er, that any distribution of profits by way of capitalization of distributable dividends shall be subject to the Supermajority Resolution. B. In accordance with the provisions of the Articles of Association, if there are profits after the final settlement of account of a year, the Company , after its losses have been offset and at the time of allocating surplus profits, may first set aside 10% of the annual profits as statutory reserve until the statutory reserve amounts to the authorized capital, and may appropriate a portion of the annual profits as special reserve required by Applicable Public Company Rules or government authorities. Thereafter, having considered the financial, business and operational factors , the Board may propose and specify no less than 10% of any remaining annual profits after the above plus, at the Board’s sole discretion, a certain percent of accumulated retained earnings to be distributed as dividends. Cash dividend shall not be less than 10% of the total dividends declared. The Company may distribute to the shareholders, in the form of cash, all or a portion of its Dividend and/or statutory reserve by a majority of the Directors at a meeting attended by two-thirds or more of the total number of the Directors, and shall subsequently report such distribution to the shareholders at the general meeting. C. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The
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~35~ use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital. D. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When the debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings. E. (a) The Company recognized dividends distributed to owners for the first and second half year of 2023. The appropriation of the first and second half year of 202 3 earnings had been approved by the Board of Directors on November 1, 2023 and April 24, 2024, respectively. The appropriation of 2023 earnings had been approved by the shareholders on June 12, 2024. (b) The Company recognized dividends distributed to owners for the first half year of 2024. The appropriation of the first and second half year of 2024 earnings had been approved by the Board of Directors on October 30, 2024 and April 23, 2025. The appropriation of 2024 earnings had been approved by the shareholders on June 11, 2025. (c) The Company recognized dividends distributed to owners for the first half year of 202 5. The appropriation of the first half year of 202 5 earnings had been approved by the Board of Directors on October 29, 2025. For the information relating to the above distribution of earnings as approved by the Board of Directors or shareholders, please refer to the “Market Observation Post System” at the website of the Taiwan Stock Exchange Company. Dividends per share Dividends per share Amount (in dollars) Amount (in dollars) Legal reserve -$ -$ Special reserve - - Cash dividends 390,871 4.89$ 624,689 7.88$ First half year of 2023 Second half year of 2023 Dividends per share Dividends per share Amount (in dollars) Amount (in dollars) Legal reserve -$ -$ Special reserve - - Cash dividends 570,088 7.19$ 724,609 9.28$ First half year of 2024 Second half year of 2024 Dividends per share Amount (in dollars) Legal reserve -$ Special reserve 451,081 Cash dividends 684,620 8.71$ First half year of 2025
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~36~ the Taiwan Stock Exchange Company. (14) Operating revenue Disaggregation of revenue from contracts with customers The Group has only one reportable operating segment. The Group derives revenue from the following major product lines: (15) Other gains and losses Revenue from contracts with customers 2,081,407$ 1,757,231$ 352,875$ 185,512$ 4,377,025$ Revenue from contracts with customers 1,994,276$ 1,820,893$ 441,448$ 144,119$ 4,400,736$ For the three months ended September 30, 2024 Serial products of DisplayPort High-speed interfacing chips Source Driver Serial products of TrueTouch Total For the three months ended September 30, 2025 Serial products of DisplayPort High-speed interfacing chips Source Driver Serial products of TrueTouch Total High-speed Serial products Serial products interfacing chips of DisplayPort Source Driver of TrueTouch Total Revenue from contracts with customers 6,260,444$ 4,695,145$ 1,112,787$ 574,682$ 12,643,058$ High-speed Serial products Serial products interfacing chips of DisplayPort Source Driver of TrueTouch Total Revenue from contracts with customers 5,284,475$ 4,857,728$ 1,557,570$ 425,339$ 12,125,112$ For the nine months ended September 30, 2024 For the nine months ended September 30, 2025 2025 2024 Foreign exchange (losses) gains 4,192)($ 840$ Losses on disposals of equipment - - Other losses 4,206)( - 8,398)($ 840$ 2025 2024 Foreign exchange (losses) gains 3,508)($ 1,474$ Losses on disposals of equipment - 694)( Other losses 5,973)( 600)( 9,481)($ 180$ For the three months ended September 30, For the nine months ended September 30,
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~37~ (16) Expenses by nature (17) Employee benefit expenses 2025 2024 Employee benefit expenses 756,094$ 831,711$ Depreciation and amortization charges on equipment and intangible assets 173,756 172,321 Engineering expenses 149,986 123,062 Legal and professional expenses 26,613 21,143 Commission expenses 10,309 15,604 Expense on short-term lease contracts 574 616 Total manufacturing and operating expenses 1,117,332$ 1,164,457$ 2025 2024 Employee benefit expenses 2,320,559$ 2,557,773$ Depreciation and amortization charges on equipment and intangible assets 585,810 516,652 Engineering expenses 455,513 350,809 Legal and professional expenses 83,411 51,904 Commission expenses 26,323 36,766 Expense on short-term lease contracts 1,803 1,933 Total manufacturing and operating expenses 3,473,419$ 3,515,837$ For the three months ended September 30, For the nine months ended September 30, 2025 2024 Wages and salaries 491,157$ 518,406$ Employee compensation costs 157,323 200,710 Pension costs 39,910 41,529 Other personnel expenses 67,704 71,066 756,094$ 831,711$ 2025 2024 Wages and salaries 1,485,550$ 1,471,053$ Employee compensation costs 470,995 721,721 Pension costs 128,438 128,510 Other personnel expenses 235,576 236,489 2,320,559$ 2,557,773$ For the nine months ended September 30, For the three months ended September 30,
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~38~ A. In accordance with the provisions of the amended Articles of Association approved by the shareholders, where the Company generates profits before tax for the annual financial year, the Company shall appropriate no less than 3% and up to 7.5% of such annual profits before tax as employees’ compensation, which shall be distributed in accordance with the incentive programme approved by a majority of the meeting of Board of Directors attended by two-thirds or more of all the Directors and may be distributed to employees of the Company and its subsidiaries and a maximum of 2% as additional directors’ remuneration. B. For the three months and nine months ended September 30, 2025 and 2024 , employees’ compensations were accrued at $41,426, $55,326, $130,029 and $126,783, respectively; directors’ remunerations were accrued at $11,819, $1 6,593, $42,393 and $36,847, respectively. The aforementioned amounts were recognised in salary expenses. For the nine months ended September 30, 202 5 the employees’ compensation and directors’ remuneration were estimated and accrued based on the distributable profit of current year as of the end of reporting period, and the percentage of previous year payment. For 2024, the employees’ compensation and directors’ remuneration resolved at the meeting of Board of Directors amounted to $ 171,419 and $51,376, respectively. The employees’ compensation will be distributed in the form of cash. The difference between the employees’ compensation of $ 178,214 and the directors’ remuneration of $ 52,446 recognised in the 202 4 financial statements were ($6,795) and ($1,070), respectively, mainly resulting from the difference between accrual amount and resolution amount by the Board of Directors, and recognized as profit or loss in the year. Information about employees’ compensation and directors’ remuneration of the Company as resolved at the meeting of Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.
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~39~ (18) Income tax Components of income tax expense: (19) Earnings per share 2025 2024 Current tax: Current tax on profits for the period 60,257$ 89,695$ Prior year income tax underestimation (overestimation) 304 18,402)( Total current tax 60,561 71,293 Deferred tax: Origination and reversal of temporary differences 4,980 19,842 Income tax expense 65,541$ 91,135$ 2025 2024 Current tax: Current tax on profits for the period 257,582$ 222,840$ Prior year income tax overestimation 14,784)( 64,008)( Total current tax 242,798 158,832 Deferred tax: Origination and reversal of temporary differences 38,410)( 3,368)( Income tax expense 204,388$ 155,464$ For the three months ended September 30, For the nine months ended September 30, Earnings per share Amount after tax (share in thousands) (in NT dollars) Basic earnings per share Profit attributable to ordinary shareholders of the Company 815,920$ 78,059 10.45$ Diluted earnings per share Profit attributable to ordinary shareholders of the Company 815,920$ 78,059 Assumed conversion of all dilutive potential ordinary shares Employees' compensation - 171 Restricted stocks to employees - - Profit attributable to ordinary shareholders of the Company plus assumed conversion of all dilutive potential ordinary shares 815,920$ 78,230 10.43$ For the three months ended September 30, 2025 Weighted average number of ordinary shares outstanding
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~40~ Earnings per share Amount after tax (share in thousands) (in NT dollars) Basic earnings per share Profit attributable to ordinary shareholders of the Company 761,701$ 79,629 9.57$ Diluted earnings per share Profit attributable to ordinary shareholders of the Company 761,701$ 79,629 Assumed conversion of all dilutive potential ordinary shares Employees' compensation - 165 Restricted stocks to employees - 42 Profit attributable to ordinary shareholders of the Company plus assumed conversion of all dilutive potential ordinary shares 761,701$ 79,836 9.54$ Weighted average number of ordinary shares outstanding For the three months ended September 30, 2024 Earnings per share Amount after tax (share in thousands) (in NT dollars) Basic earnings per share Profit attributable to ordinary shareholders of the Company 2,182,337$ 78,973 27.63$ Diluted earnings per share Profit attributable to ordinary shareholders of the Company 2,182,337$ 78,973 Assumed conversion of all dilutive potential ordinary shares Employees' compensation - 323 Restricted stocks to employees - 7 Profit attributable to ordinary shareholders of the Company plus assumed conversion of all dilutive potential ordinary shares 2,182,337$ 79,303 27.52$ For the nine months ended September 30, 2025 Weighted average number of ordinary shares outstanding
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~41~ (20) Business combinations A. The Company acquired Spectra7 Microsystems Inc. business for an aggregated acquisition price of US$9,000 thousand in cash on April 23, 2025. This acquisition will provide valuable support for Parade’s efforts to expand into high -growth markets such as data centers, AI -powered computing, and next-generation consumer electronics. B. The following table (expressed in thousands of US dollars) summarizes the consideration paid for Spectra7 Microsystems Inc. business and the fair values of the assets acquired at the acquisition date: C. The fair value of the acquired identifiable intangible assets of US$5,013 thousand is provisional pending receipt of the final valuations for those assets. D. As of September 30, 20 25, the operating revenue included in the consolidated statement of Earnings per share Amount after tax (share in thousands) (in NT dollars) Basic earnings per share Profit attributable to ordinary shareholders of the Company 1,903,156$ 79,737 23.87$ Diluted earnings per share Profit attributable to ordinary shareholders of the Company 1,903,156$ 79,737 Assumed conversion of all dilutive potential ordinary shares Employees' compensation - 238 Restricted stocks to employees - 131 Profit attributable to ordinary shareholders of the Company plus assumed conversion of all dilutive potential ordinary shares 1,903,156$ 80,106 23.76$ Weighted average number of ordinary shares outstanding For the nine months ended September 30, 2024 April 23, 2025 Purchase consideration Cash paid 9,000$ Fair value of the identifiable assets acquired Inventories 320 Prepaid expense 361 Property, plant and equipment 110 Intangible assets 5,013 Total identifiable net assets 5,804 Goodwill 3,196$
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~42~ comprehensive income since April 23, 2025 contributed by Spectra7 Microsystems Inc. business was US$324 thousand. Spectra7 Microsystems Inc. business also contributed loss before income tax of (US$930) thousand over the same period. (21) Changes in liabilities from financing activities 7. RELATED PARTY TRANSACTIONS (1) Significant transactions and balances with related parties None. (2) Key management compensation A. Salaries and bonuses include regular wages, special responsibility allowances, pensions, severance pay, various bonuses , employees ’ compensation, directors ’ remuneration, rewards and travel or transportation allowances, etc. B. Share-based compensation expenses represent the compensation costs accounted for under IFRS 2. 8. PLEDGED ASSETS None. 9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT COMMITMENTS (1) Contingencies None. (2) Commitments None. 10. SIGNIFICANT DISASTER LOSS None. 2025 2024 Lease liabilities Lease liabilities At January 1 323,076$ 258,252$ Changes in cash flow from financing activities 94,012)( 91,613)( Impact of changes in foreign exchange rate 16,408)( 7,842 Changes in other non-cash items 156,848 94,982 At September 30 369,504$ 269,463$ 2025 2024 Salaries and other short-term employee benefits 43,052$ 121,726$ Share-based compensation expenses 4,914 29,152 47,966$ 150,878$ 2025 2024 Salaries and other short-term employee benefits 254,530$ 324,686$ Share-based compensation expenses 171,295 188,500 425,825$ 513,186$ For the three months ended September 30, For the nine months ended September 30,
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~43~ 11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DA TE Please refer to Note 6(13) for the appropriation of the first half year of 2025 earnings. 12. OTHERS (1) Consolidated balance sheets as of September 30, 2025, December 31, 2024, and September 30, 2024 and consolidated statements of comprehensive income for the three months and nine months ended September 30, 2025 and 2024 in functional currency The Company prepare s its consolidated financial statements in US Dollars. For the purpose of application for listing in the Taipei Exchange in R.O.C., the consolidated financial statements were translated into New Taiwan Dollars in accordance with Note 4. Since the functional currency is US Dollars, the supplementary disclosure of consolidated balance sheet s and statement s of comprehensive income in US Dollars are as follows:
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~44~ Amount % Amount % Amount % Current assets Cash and cash equivalents 321,937$ 40 321,193$ 40 304,902$ 39 Accounts receivable, net 60,357 8 47,711 6 54,152 7 Inventories, net 106,006 13 121,460 15 110,296 14 Other current assets 23,142 3 19,645 3 23,486 3 Total current assets 511,442 64 510,009 64 492,836 63 Non-current assets Property, plant and equipment, net 9,770 1 10,628 1 10,604 1 Right-of-use assets 12,135 2 9,853 1 8,514 1 Intangible assets 111,738 14 103,238 13 100,239 13 Deferred income tax assets 11,737 1 12,070 2 12,433 2 Other non-current assets 145,353 18 153,367 19 156,286 20 Total non-current assets 290,733 36 289,156 36 288,076 37 TOTAL ASSETS 802,175$ 100 799,165$ 100 780,912$ 100 Current liabilities Accounts payable 40,117$ 5 40,288$ 5 48,733$ 6 Other payables 25,499 3 50,564 6 25,609 3 Current income tax liabilities 13,627 2 11,120 1 12,169 2 Lease liabilities - current 4,167 1 3,830 1 3,492 - Other current liabilities 8,983 1 5,900 1 6,321 1 Total current liabilities 92,393 12 111,702 14 96,324 12 Non-current liabilities Lease liabilities - non-current 7,968 1 6,023 1 5,022 1 Total non-current liabilities 7,968 1 6,023 1 5,022 1 Total liabilities 100,361 13 117,725 15 101,346 13 Equity attributable to owners of the Company Share capital Ordinary shares 26,388 3 26,730 3 26,730 3 Capital reserves Capital reserves 107,858 14 135,718 16 136,328 18 Retained earnings Legal reserve 33,380 4 33,380 4 33,380 4 Special reserve 275 - 275 - 275 - Unappropriated earnings 583,233 72 536,373 69 532,962 68 Other equity 2,801)( - 4,189)( 1)( 3,262)( - Treasury shares 46,519)( 6)( 46,847)( 6)( 46,847)( 6)( Equity attributable to owners of the Company 701,814 87 681,440 85 679,566 87 Total equity 701,814 87 681,440 85 679,566 87 TOTAL LIABILITIES AND EQUITY 802,175$ 100 799,165$ 100 780,912$ 100 Other equity PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2025, DECEMBER 31, 2024 AND SEPTEMBER 30, 2024 (EXPRESSED IN THOUSANDS OF US DOLLARS) ASSETS LIABILITIES AND EQUITY September 30, 2024December 31, 2024September 30, 2025
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~45~ Amount % Amount % Amount % Amount % Revenues 146,144$ 100 136,246$ 100 405,870$ 100 378,395$ 100 Cost of goods sold 84,033)( 58)( 78,299)( 58)( 232,492)( 57)( 217,213)( 57)( Gross profit 62,111 42 57,947 42 173,378 43 161,182 43 Operating expenses Sales and marketing expenses 7,117)( 5)( 7,014)( 5)( 19,950)( 5)( 21,981)( 6)( General and administrative expenses 4,485)( 3)( 4,849)( 3)( 13,854)( 4)( 14,702)( 4)( Research and development expenses 23,387)( 16)( 22,752)( 17)( 69,476)( 17)( 68,755)( 18)( Total operating expenses 34,989)( 24)( 34,615)( 25)( 103,280)( 26)( 105,438)( 28)( Operating income 27,122 18 23,332 17 70,098 17 55,744 15 Non-operating income and expenses Interest income 2,470 2 2,942 2 6,627 2 8,287 2 Other income 119 - 104 - 377 - 173 - Other gains and losses 280)( - 26 - 317)( - 5 - Total non-operating income and expenses 2,309 2 3,072 2 6,687 2 8,465 2 Income before income tax 29,431 20 26,404 19 76,785 19 64,209 17 Income tax expense 2,188)( 1)( 2,822)( 2)( 6,563)( 2)( 4,836)( 1)( Net income for the period from 27,243 19 23,582 17 70,222 17 59,373 16 Other comprehensive income Components of other comprehensive income that will not be reclassified to profit or loss Currency translation differences of foreign operations 107 - 857 1 1,154 - 103 - Components of other comprehensive income that will not be reclassified to profit or loss 107 - 857 1 1,154 - 103 - Total comprehensive income for the period 27,350$ 19 24,439$ 18 71,376$ 17 59,476$ 16 Net income attributable to: Owners of the Company 27,243$ 19 23,582$ 17 70,222$ 17 59,373$ 16 Comprehensive income attributable to: Owners of the Company 27,350$ 19 24,439$ 18 71,376$ 17 59,476$ 16 Earnings per share Basic earnings per share Diluted earnings per share 0.74$ 2025 20242025 2024 0.30$ 0.30$ 0.89$ 0.35$ continuing operations 0.74$ PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (EXPRESSED IN THOUSANDS OF US DOLLARS, EXCEPT FOR EARNINGS PER SHARE AMOUNTS) For the nine months ended September 30, FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024 For the three months ended September 30, 0.89$ 0.35$
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~46~ (2) Capital management The Group manages its capital in a manner to ensure that it has sufficient and necessary financial resources to fund its working capital needs, capital asset purchases, research and development activities, dividend payments, debt service requirements and other business requirements associated with its existing operations over the next 12 months. (3) Financial instruments A. Financial instruments by category B. Financial risk management policies (a) The Group’s activities expose it to a variety of financial risks: market risk ( such as foreign exchange risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group’s financial position and financial performance. (b) Risk management is carried out by a central treasury department ( Group treasury) under policies approved by the Board of Directors. Group treasury identifies, evaluates and hed ges financial risks in close co operation with the Group’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non -derivative financ ial instruments, and investment of excess liquidity. September 30, 2025 December 31, 2024 September 30, 2024 Financial assets Financial assets at amortised cost Cash and cash equivalents 9,802,985$ 10,531,902$ 9,650,152$ Accounts receivable, net 1,837,871 1,564,455 1,713,915 Guarantee deposits paid 3,755,517 4,176,470 4,033,834 15,396,373$ 16,272,827$ 15,397,901$ September 30, 2025 December 31, 2024 September 30, 2024 Financial liabilities Financial liabilities at amortised cost Accounts payable 1,221,549$ 1,321,038$ 1,542,412$ Lease liability 369,504$ 323,076$ 269,463$
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~47~ C. Significant financial risks and degrees of financial risks (a) Market risk Foreign exchange risk i. The Group’s major purchases and sales transactions are denominated in US Dollars. The change in fair value will be caused by fluctuations in the foreign exchange rate; however, the amounts and periods of the Group’s assets and liabilities in foreign currencies are equivalent, so the market risk could be offset. ii. The Group’s businesses involve non-functional currency operations. The information on assets denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows: Based on the foreign currency quoted position held by the Group as of September 30, 2025 and 2024, as US dollars appreciate/depreciate by 1%, the profit or loss before tax of the Group would increase by $80 and $84, respectively. iii. Total exchange gain (loss), including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Group for the three months and nine months ended September 30, 2025 and 2024 , amounted to $(5,982), $1,336, $718 and $16 respectively. (b) Credit risk i. Credit risk refers to the risk of financial loss to the Group arising from default by the clients. The main factor is that counterparties could not repay in full the accounts receivable based on the agreed terms. Foreign Currency Amount Exchange Book Value (in RMB thousands) Rate (in USD thousands) (Foreign currency:functional currency) Financial assets - monetary items RMB:USD 1,877$ 0.141 264$ Foreign Currency Amount Exchange Book Value (in RMB thousands) Rate (in USD thousands) (Foreign currency:functional currency) Financial assets - monetary items RMB:USD 1,898$ 0.139 264$ Foreign Currency Amount Exchange Book Value (in RMB thousands) Rate (in USD thousands) (Foreign currency:functional currency) Financial assets - monetary items RMB:USD 1,851$ 0.143 264$ September 30, 2024 December 31, 2024 September 30, 2025
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~48~ ii. The Group manages their credit risk taking into consideration the entire group’s concern. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Group treasury. The utilization of credit limits is regularly monitored. iii. The default occurs when the contract payments are past due over 360 days. iv. If the contract payments were past due over 60 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition. v. The following indicators are used to determine whether the credit impairment has occurred: (i) It becomes probable that the issuer will enter bankruptcy or other financial reorganization due to their financial difficulties; (ii) The disappearance of an active market for that financial asset because of financial difficulties; (iii) Default or delinquency in interest or principal repayments; (iv) Adverse changes in national or regional economic conditions that are expected to cause a default. vi. The Group classifies customers’ accounts receivable in accordance with customer types. The Group applies the simplified approach using loss rate methodology to estimate expected credit loss under the provision matrix basis. vii. The Group used timely information to assess the default possibility of accounts receivable. On September 30, 2025, December 31, 2024, and September 30, 2024 , the loss rate methodology is as follows: Up to 60 days Up to 90 days Not past due past due past due 91~180 days At September 30, 2025 Expected loss rate (Note) 0 ~ 0.3% 0 ~ 0.3% 0.5% 1 ~ 5% Total book value 1,747,247$ 90,624$ -$ Loss allowance - - - - 181~360 days Up to 360 days Total At September 30, 2025 Expected loss rate (Note) 50 ~ 75% 100% Total book value -$ -$ 1,837,871$ Loss allowance - - -
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~49~ Note: Based on past experience, it has been shown that the defaults of these customers have been extremely low, so the expected credit losses are measured at a single loss rate based on the past due dates. The amount of allowance for doubtful accounts was not significant, so the Group had not recognized related impact as at December 31, 2024 and September 30, 2024. viii. The Group wrote -off the financial assets, which cannot be reasonably expected to be recovered, after initiating recourse procedures. (c) Liquidity risk i. Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group treasury . G roup treasury monitors rolling forecasts of the Group ’s liquidity requirements to ensure it has sufficient cash to meet operational needs. ii. Group treasury invests surplus cash in interest bearing current accounts, money market fund and treasury bill, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts. The Group held treasury bills of $6,743,089, $7,214,731 and $6,978,891 as at September 30, 2025, December 31, 2024, and September 30, 2024 , respectively, which are expected to immediately generate cash inflows for managing liquidity risk. Up to 60 days Up to 90 days Not past due past due past due 91~180 days At December 31, 2024 Expected loss rate (Note) 0 ~ 0.3% 0 ~ 0.3% 0.5% 1 ~ 5% Total book value 1,520,839$ 43,616$ -$ -$ Loss allowance - - - - 181~360 days Up to 360 days Total At December 31, 2024 Expected loss rate (Note) 50 ~ 75% 100% Total book value -$ -$ 1,564,455$ Loss allowance - - - Up to 60 days Up to 90 days Not past due past due past due 91~180 days At September 30, 2024 Expected loss rate (Note) 0 ~ 0.3% 0 ~ 0.3% 0.5% 1 ~ 5% Total book value 1,623,992$ 89,923$ -$ -$ Loss allowance - - - - 181~360 days Up to 360 days Total At September 30, 2024 Expected loss rate (Note) 50 ~ 75% 100% Total book value -$ -$ 1,713,915$ Loss allowance - - -
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~50~ iii. The table below analyses the Group’s non -derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. (4) Fair value information A. The different levels of inputs to valuation techniques used to measure fair value of financial and non-financial instruments have been defined as follows: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Unobservable inputs for the asset or liability. B. Financial instruments not measured at fair value The book value of financial instruments not measured at fair value , including cash and cash equivalents, accounts receivable, accounts payable and other payables , reasonably approximates their fair value. C. There were no financial and non -financial instruments measured at fair value recognized as at September 30, 2025, December 31, 2024, and September 30, 2024. September 30, 2025 Less than 1 year Between 1 year and 5 years Non-derivative financial liabilities Accounts payable 1,221,549$ -$ Other payables 776,459 - Lease liability 126,887 242,617 December 31, 2024 Less than 1 year Between 1 year and 5 years Non-derivative financial liabilities Accounts payable 1,321,038$ -$ Other payables 1,641,273 - Lease liability 125,574 197,502 September 30, 2024 Less than 1 year Between 1 year and 5 years Non-derivative financial liabilities Accounts payable 1,542,412$ -$ Other payables 810,539 - Lease liability 110,505 158,958
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~51~ 13. ADDITIONAL DISCLOSURES REQUIRED BY THE SECURITIES AND FUTURES BUREAU (1) Related information of significant transactions A. Loans to others during the nine months ended September 30, 2025 : Please refer to table 1. B. Endorsements and guarantees provided during the nine months ended September 30, 2025: None. C. Material m arketable securities held as at September 30, 2025 (not including subsidiaries, associates and joint ventures): None. D. Purchases from or sales to related parties exceeding $100 million or 20% of the Company’s paid- in capital during the nine months ended September 30, 2025: None. E. Receivables from related parties exceeding $100 million or 20% of the Company’s paid-in capital as at nine months ended September 30, 2025: None. F. Material inter-company transactions for the nine months ended September 30, 2025: Please refer to table 2. (2) Disclosure information of investee company (not including investees in Mainland China) Please refer to table 3. (3) Disclosure information on indirect investments in Mainland China A. Information on investments in Mainland China: Please refer to table 4. B. The Company's transactions with investee companies in China through other entities outside of Taiwan and China: Please refer to table 2. 14. SEGMENT INFORMATION (1) General information The Group operates business only in a single industry. The Board of Directors, who allocates resources and assesses performance of the Group as a whole, has identified that the Group has only one reportable operating segment. (2) Measurement of segment information The Group’s segment profit or loss, assets and liabilities information are in agreement with its major financial statement information. (3) Information about segment profit or loss, assets and liabilities The Group’s segment profit or loss, assets and liabilities information are in agreement with its major financial statement information. (4) Reconciliation for segment income (loss) The Group’s segment profit or loss, assets and liabilities information are in agreement with its major financial statement information.
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Table 1 Maximum outstanding balance during Amount of Limit on loans Is a the nine months Nature of transactions Allowance granted to Ceiling on total General ledger related ended Balance at Actual amount Interest loan with the Reason for short-term for doubtful single party loans granted No. Creditor Borrower account party September 30, 2025 September 30, 2025 drawn down rate （Note 1） borrower financing accounts Item Value (Note 2) (Note 2) Footnote 0 Parade Technologies Ltd. Spectra7 Microsystems, Inc Other receivables N 22,838$ -$ -$ 7.5% 2 -$ To ensure the smooth progress of the asset purchase transaction. -$ The patent rights and trademarks of Spectra7 Microsystems,Inc 107,336$ -$ 4,274,045$ (3) The principal amount of this loan facility is USD 750,000. (4) This loan facility was fully repaid in April 2025. Note 2: The Company's and its subsidiaries' limits on loans to singal party and total loans are calculated based on the Company's "Procedures for Provision of Loans" (1)The total amount of loaning funds should not exceed 20% of the Company's net worth as stated in its latest financial statement. (2)For loaning funds to each single party deriving from the business relations, the amount provided to any single party shall not exceed the total business amount between the party and the Company. For loaning funds deriving from the short-term financing needs, the amount provided to any single party shall not exceed 10% of the Company's net worth as stated in its latest financial statement and shall not exceed 20% of the party's net worth. For loaning funds deriving from the asset purchase deal to the seller(s), the amount provided to any single party shall not exceed 10% of the Company's net worth as stated in its latest financial statement and shall not exceed 20% of the party's net value of the acquired assets and assumed liabilities. Note 1: Fill in the nature of the loan as follows: (1) Fill in 1 for business transaction. (2) Fill in 2 for short-term financing Collateral PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES LOANS TO OTHERS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 Expressed in thousands of NTD (Except as otherwise indicated)
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Table 2 Number Relationship General ledger Percentage of consolidated total operating (Note 1) Company name Counterparty (Note 2) account Amount Transaction terms revenues or total assets (Note 3) 0 Parade Technologies, Ltd. Parade Technologies, Inc. (1) Service expense 873,896$ In accordance with the agreement, depending on the financial condition of the paying firm 7% (1) Other payables 98,903 In accordance with the agreement, depending on the financial condition of the paying firm 0% Parade Technologies Korea, Ltd. (1) Service expense 18,617 In accordance with the agreement, depending on the financial condition of the paying firm 0% (1) Other payables 2,075 In accordance with the agreement, depending on the financial condition of the paying firm 0% Parade Technologies, Inc. (Shanghai) (1) Service expense 575,098 In accordance with the agreement, depending on the financial condition of the paying firm 5% (1) Other payables 459,529 In accordance with the agreement, depending on the financial condition of the paying firm 2% Parade Technologies, Ltd. (Nanjing) (1) Service expense 393,862 In accordance with the agreement, depending on the financial condition of the paying firm 3% (1) Other payables 320,342 In accordance with the agreement, depending on the financial condition of the paying firm 1% Parade Technologies, Ltd. (Chongqing) (1) Service expense 109,103 In accordance with the agreement, depending on the financial condition of the paying firm 1% (1) Other payables 13,503 In accordance with the agreement, depending on the financial condition of the paying firm 0% subsidiaries refer to the same transaction, it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction; Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows: (1)Parent company is ‘0’. (2)The subsidiaries are numbered in order starting from ‘1’. Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between Transaction PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES MATERIAL INTER-COMPANY TRANSACTIONS DURING THE REPORTING PERIODS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 Expressed in thousands of NTD (Except as otherwise indicated) for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction.): (1)Parent company to subsidiary. (2)Subsidiary to parent company. (3)Subsidiary to subsidiary. Note 3: Regarding percentage of transaction amount to consolidated total operating revenues or total assets, it is computed based on period-end balance of transaction to consolidated total assets for balance sheet accounts and based on accumulated transaction amount for the period to consolidated total operating revenues for income statement accounts. Note 4: The Company may decide to disclose or not to disclose transaction details in this table based on the Materiality Principle.
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Table 3 Investee Main business Balance as at Balance as at Investor (Notes 1 and 2) Location activities 09/30/2025 1/1/2025 Number of shares Ownership (%) Book value (Note 2(2)) (Note 2(3)) Footnote The Company Parade Technologies, Inc. United States Providing sales and marketing, general and administrative, and research and development services to the Company 39,585$ 39,585$ 10,000 100.00 3,874,091$ 79,020$ 79,020$ The Company Parade Technologies Korea, Ltd. South Korea Providing sales and marketing, general and administrative services to the Company 1,523 1,523 10,000 100.00 23,160 722 722 The Company Pinchot Ltd. Cayman Islands Providing administrative services to the Company 30 30 1,000 100.00 30 - - Initial investment amount Shares held as at 09/30/2025 PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES INFORMATION ON INVESTEES (NOT INCLUDING INVESTEES IN MAINLAND CHINA) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 Expressed in thousands of NTD (Except as otherwise indicated) Investment income recognised by the Company Net income of the investee (2)The ‘Net income (loss) of the investee' column should fill in amount of net income (loss) of the investee for this period. (3)The ‘Investment income (loss) recognised by the Company' column should fill in the Company (public company) recognised investment income (loss) of its direct subsidiary and recognised investment income (loss) of its investee accounted for under the equity method for this period. When filling in recognised investment income (loss) of its direct subsidiary, the Company (public company) should confirm that direct subsidiary’s net income (loss) for this period has included its investment income (loss) which shall be recognised by regulations. Note 1: If a public company is equipped with an overseas holding company and takes consolidated financial report as the main financial report according to the local law rules, it can only disclose the information of the overseas holding company about the disclosure of related overseas investee information. Note 2: If situation does not belong to Note 1, fill in the columns according to the following regulations: (1)The columns of ‘Investee’, ‘Location’, ‘Main business activities’, Initial investment amount’ and ‘Shares held as at 9/30/2025’ should fill orderly in the Company’s (public company’s) information on investees and every directly or indirectly controlled investee’s investment information, and note the relationship between the Company (public company) and its investee each (ex. direct subsidiary or indirect subsidiary) in the ‘footnote’ column.
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Table 4 Investment Investee in Main business Paid-in method Mainland China activities capital (Note 1) Footnote Parade Technologies, Inc. (Shanghai) Providing research and development services to the Company 39,585$ 1 $ - $ - $ - $ - 5,653$ 100.00 5,653$ 962,545$ $ - Parade Technologies, Ltd. (Nanjing) Providing research and development services to the Company 60,900 2 - - - - 14,624 100.00 14,624 558,617 - Parade Technologies, Ltd. (Chongqing) Providing research and development services to the Company 15,225 2 - - - - 5,263 100.00 5,263 68,534 - Company name The Company $ - $ - $ - Investment income recognised by the Company Book value of investments in Mainland China as of 9/30/2025 Accumulated amount of investment income remitted back to Taiwan as of 9/30/2025 Remitted to Mainland China Remitted back to Taiwan PARADE TECHNOLOGIES, LTD. AND SUBSIDIARIES INFORMATION ON INVESTMENTS IN MAINLAND CHINA FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 Expressed in thousands of NTD (Except as otherwise indicated) Accumulated amount of remittance from Taiwan to Mainland China as of 1/1/2025 Amount remitted from Taiwan to Mainland China / Amount remitted back to Taiwan Accumulated amount of remittance from Taiwan to Mainland China as of 9/30/2025 Net income of investee as of 9/30/2025 Ownership held by the Company (direct or indirect) (2) Directly invest in a company in Mainland China. Note 2: The Company is registered in Cayman Islands; therefore, its investment in Mainland China does not need approval from the Investment Commission of MOEA. Accumulated amount of remittance from Taiwan to Mainland China as of 9/30/2025 Investment amount approved by the Investment Commission of the Ministry of Economic Affairs (MOEA)(Note 2) Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA Note 1: Investment methods are classified into the following two categories; fill in the number of category each case belongs to: (1)Through investing in an existing company in the third area, which then invested in the investee in Mainland China.(Parade Technologies, Inc.)