Faraday Reports Third Quarter 2022 Results

Hsinchu, Taiwan -- October 25, 2022 -- Faraday Technology Corporation (“Faraday” or the “Company”) (TWSE: 3035), a leading fabless ASIC service and silicon IP provider, today announced its consolidated financial results for the third quarter of 2022. Third quarter consolidated revenue was NT$3,244 million, down by 4% QoQ and up by 46% YoY, with gross margin of 48.6% and operating margin of 21.9%. Net income attributed to stockholders of the parent was NT$599 million, with a basic EPS of NT$2.41.

Looking back to the third quarter, revenue was down 4% QoQ and up 46% YoY to NT$3,244 million mainly due to demand slowdown in mass production business while gross margin was 48.6%, thanks to mix improvement. Operating income down 14% QoQ and up 58% YoY to NT$710 million with operating margin of 21.9%. Net income attributed to stockholders of the parent was NT$599 million, down 9% QoQ and up 83% YoY, with an EPS of NT$2.41. In terms of product mix, all product segments delivered YoY growth this quarter. IP revenue was NT$380 million, up 20% QoQ and 43% YoY, hitting quarterly record. NRE revenue was down 5% QoQ and up 37% YoY to NT$420 million due to the timing of milestone recognition. Mass production was down 6% QoQ and up 49% YoY to NT$2,444. The Company achieved several milestones in the first nine months this year: 2022 revenue was NT$9,815 million surpassed its yearly sales record in nine months; mass production showed significant growth and reached NT$7,552 million, breaking its yearly record in the Company’s history.

Looking into the fourth quarter, revenue is expected to continue to grow despite of cyclical fluctuations while annual revenue to reach a new high backed by record sales of IP, NRE and mass production businesses. Faraday has long focused on applications with high volume especially in energy management, production efficiency, green energy and life quality, while growing the penetration rate in each application and customer to strengthen its ASIC production business, resulting in the countercyclical business operation this year. Going forward, the Company will target the segments with high profitability through new business models, aiming to amplify its corporate values.

[1] Unless otherwise stated, all financial figures discussed in this announcement are prepared in accordance with Taiwan-International Financial Report Standards (TIFRSs). They represent comparisons among the three-month period ended September 30, 2022, the three-month period ended June 30, 2022, and the equivalent three-month period that ended September 30, 2021. For all 3Q22 results, New Taiwan Dollar (NT$) amounts have been converted into U.S. dollars at the exchange rate of NT$29.87 to one U.S. dollar.

Summary of Operating Results

(Amount: NT$ million)	3Q22	2Q22	QoQ% change
Revenues	3,244	3,365	(3.6)
Gross profit	1,576	1,660	(5.0)
Operation expenses	(866)	(835)	3.7
Operating income	710	825	(13.9)
Non-operating items	49	15	229.6
Net income attributed to stockholders of the parent	599	661	(9.4)
EPS (NTD)	2.41	2.66

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