Stock code: 688521 Stock abbreviation: VeriSilicon Announcement No.: 2025-001

VeriSilicon Microelectronics (Shanghai) Co., Ltd

2024 Annual Results Forecast Announcement

The board of directors and all directors of the company guarantee that there are no false records, misleading statements or material omissions in the content of this announcement, and assume legal responsibility for the authenticity and accuracy of its content in accordance with the law.

Important Content Notes:

VeriSilicon Microelectronics (Shanghai) Co., Ltd. (hereinafter referred to as the "Company") expects to achieve results in 2024

The current operating income is about 2.323 billion yuan, which is basically the same as that in 2023.

The company expects to achieve a net profit attributable to owners of the parent company of about -613 million yuan in 2024

Compared with the same period last year (statutory disclosure data), the year-on-year decrease was about 317 million yuan.

The company expects to achieve net profit attributable to owners of the parent company after deducting non-recurring gains and losses in 2024

Run about -646 million yuan, compared with the same period last year (statutory disclosure data), a year-on-year decrease of about 328 million yuan.

1. Forecast of performance for the current period

(1) The performance forecast period

January 1, 2024 to December 31, 2024.

(2) Performance forecast

1. According to the preliminary calculation of the financial department, the company expects to achieve operating income of about 2.323 billion yuan in 2024.

Basically the same as in 2023.

2. According to the preliminary calculation of the financial department, the company expects to achieve a net profit attributable to the owners of the parent company of about -613 million yuan in 2024, a year-on-year decrease of about 317 million yuan compared with the same period last year (statutory disclosure data).

3. According to the preliminary calculation of the financial department, the company expects to achieve a net profit attributable to the owners of the parent company after deducting non-recurring gains and losses of about -646 million yuan in 2024, a year-on-year decrease of about 328 million yuan compared with the same period last year (statutory disclosure data).

Second, the performance of the same period last year

(1) Operating income: 2.338 billion yuan

(2) Net profit attributable to owners of the parent company: -296 million yuan

(3) Net profit attributable to owners of the parent company after deducting non-recurring gains and losses: -318 million yuan

3. The main reasons for the change in the performance of the current period

In 2021, under the condition of tight production capacity in the industry, the company achieved a year-on-year increase of about 35% in mass production business revenue and a year-on-year increase of about 42% in operating income; In 2022, the global semiconductor industry will decline, and the company's operating income will increase by about 25% against the trend, successfully achieving "U picking"; In 2023, under the very difficult industrial environment, the company still maintained a positive net profit in the first half of the year and a net profit after deducting non-profits. Affected by the slowdown in global economic growth, the downward cycle of the semiconductor industry and destocking, the company's revenue declined year-on-year for only three quarters. In the first half of 2024, the semiconductor industry has gradually recovered, thanks to the company's unique business model, that is, in principle, there is no risk of product inventory and no application boundaries, and the company's operating situation has rapidly reversed since the second quarter. The company's operating income in the second quarter of 2024 will return to the level before the impact of the industry cycle year-on-year, and the operating income in the third quarter of 2024 will hit a new high in the third quarter of the previous year, with a year-on-year increase of 23.60%, and the revenue in the fourth quarter will increase by more than 17% year-on-year, and the annual operating income is expected to be basically the same as in 2023. In the second half of 2024, the company's chip design business revenue increased by approximately 81% year-on-year, intellectual property licensing business revenue increased by approximately 21% year-on-year, and mass production business revenue decreased by approximately 4% year-on-year. In the fourth quarter of 2024, the company's chip design business revenue increased by about 81% year-on-year, intellectual property licensing business revenue decreased by about 28% year-on-year, and mass production business revenue increased by about 32% year-on-year, reflecting the company's revenue was affected by the industry downcycle late and resumed growth earlier.

As of the end of 2024, the company's orders are in good condition, with orders in hand of 2.406 billion yuan, compared with the end of the third quarter

2.138 billion yuan further increased by nearly 13%, and orders in hand have remained high for five consecutive quarters. I signed a single corner from scratch

In the fourth quarter of 2024, the company signed more than 940 million yuan of new orders, and the total amount of new orders signed in the second half of 2024 was higher than that in 2024

In the first half of the year, it increased by more than 38%, and increased by more than 36% year-on-year compared with the second half of 2023, which is lower than the semiconductor industry cycle

and the first half of 2023 under the influence of destocking, a significant increase of more than 66%, laying a solid foundation for the company's future business expansion and performance transformation.

After more than 20 years of continuous high R&D investment, the company has abundant and high-quality technical reserves, and actively selects and cultivates high-quality technical talents in the downward cycle of industries where other companies do not recruit or recruit fewer people. The company has devoted itself to technology research and development in key application areas, such as chiplet technology and its application in generative artificial intelligence and intelligent driving five years ago, due to the short-term reduction of customer projects under the industrial downturn, the company has increased the proportion of R&D investment compared with the past, and the R&D expenses in 2024 increased by about 32% year-on-year. With the increase in orders for the company's chip design business, the revenue of the chip design business in the second half of 2024 will increase by about 81% year-on-year, and R&D resources have been gradually invested in customer projects, and it is expected that the proportion of the company's R&D investment will return to normal levels in the future. At present, the company has accumulated sufficient technical and human resources, and its technical capabilities are leading in the industry, and continue to be recognized by high-quality customers around the world.

4. Risk Warning

The company's performance forecast data has not been audited by certified public accountants, and is a preliminary accounting conducted by the financial department based on its own professional judgment. The company does not have any major uncertainties that affect the accuracy of the content of this earnings forecast. 5. Other explanatory matters

The above forecast data is only preliminary accounting data, and the specific and accurate financial data are subject to the audited 2024 annual report officially disclosed by the company.

The announcement is hereby made.

Board of Directors of VeriSilicon Microelectronics (Shanghai) Co., Ltd

January 21, 2025