Good day everyone and welcome to E Ink's 2025 fourth quarter earnings conference call. Before we start, I would like to briefly share a few applications examples of e-paper shown on the cover page.

Basically we joined ISE, Integrated Systems Europe. We can see the e-paper is actually rapidly expanding in the digital signage and retail display market.

This year's exhibition, more than 30 ecosystem partners showcased a wide range of e-paper applications. We prepare a video clip later so we can see more information in that video clip.

All right, next page. All right, we take a few moments to look at the safe harbor statement.

All right, next page. Let's look at some key highlights in P&L.

For the full year '25, the consolidated sales revenue amounted to NT$36.1 billion, representing 12% year-over-year increase. Operating profit reached NT$10.67 billion, up 40% year-over-year growth.

The net income totaled NT$10.5 billion with associated EPS of NT$9.14. The sales revenue for '25 was the second highest in the company's history.

Both operating profit and net income reached record highs, with net income surpassing the NT$10 billion level. Next page.

Driven by sales revenue growth in '25, operating profit increased up to NT$10.7 billion with operating margin maintained at nearly 30%. Next page.

On the asset side, total assets increased from 91.2 billion to 107.2 billion, representing the year-over-year increase of 16 billion. Year-over-year growth about 18%.

The net asset value per share reached NT$59.6. Next page.

As for the cash flow, in '25, both cash position and the pure cash position and financial assets continued to increase, reaching a total of 70.4 billion, up by 11 billion compared with the end of last year. The company continues to maintain strong profitability and healthy cash flow, with ample capital resources.

We will allocate funds appropriately in line with operational plans to support sustainable growth. Okay.

For dividend, the EPS, as I mentioned earlier, is NT$9.14. Once again marking the highest in the company's history.

The dividend distribution will be NT$5.9 per share and with a payout ratio of 65%. Okay.

The next few pages, we would like to share E Ink strategic value within AI infrastructures. I think AI has been, it's no longer a race of for computing power.

It's also a race for energy efficiency. As AI continues to advance rapidly, energy demand is becoming one of the most critical challenge facing the global technology industry.

Market research indicates that electricity demand for AI-related computing and infrastructure is growing at an approximately 15% CAGR annually. AI is expected to add about 469 TWh of global electricity demand by 2030, compared with 2025.

Amazingly equivalent to Germany's annual power consumption. In a commercial electricity cost terms, that would translate into more than $70 billion.

Yet, across the AI value chain, display devices, the interface that interacts most directly and frequently with people, have long been overlooked from an energy efficiency perspective. As AI digital services continue to scale, display devices are no longer just tools for presenting information.

They are increasingly become an important part of the energy infrastructure that support AI operations. As power demand from AI keeps rising, improving the energy efficiency of end-point display is one of the most direct and cost-effective ways to reduce overall energy burden.

We would like to say, with our ultra-low power consumption, e-paper display can definitely help unlock more energy resources for AI computing and digital services. That is E Ink's strategic value within the AI ecosystems.

Having said that, the AI needs computing power. Computing power needs energy.

I think, fundamentally, transforming display technology definitely will be the key way to release that energy. Display are critical because display systems are one of the largest fixed electricity loads in public space today.

I think for those who are familiar with us, or maybe you are not familiar with us, our technology basically e-paper uses bi-stable display architecture, meaning power is only consumed when the image changes. For large-format applications, a conventional LCD signage display operating 14 hours per day consumes approximately 283 Wh per day based on the average power, average power usage of 30- to 80-inch display.

Our e-paper display consumes only about 2.53 Wh per day. If I convert into the percentage, basically reducing display-related energy consumption by approximately 99.9%.

That's a huge saving. On the annual basis, each e-paper display can save around 759 kWh of electricity.

If approximately, 618 million e-paper displays were deployed—in other words, if we can replace those LCD and LED displays—the total electricity saving could offset the number I just mentioned, 469 TWh of additional electricity demand expected from AI between now and 2030. I just mentioned equivalent to, the whole year Germany's annual electricity consumption.

All right, next page. If I express differently in different ways from a carbon reduction perspective, the electricity demand associated with AI I just mentioned, the energy saving impact mentioned above is equivalent to reducing approximately 223 million tons of CO2 emissions, which is comparable to removing 48 million cars from the road for 1 year, or you may say equivalent to carbon absorption capacity of 3.7 billion trees.

Again, E Ink will continue to expand e-paper applications in smart retail, transportation information system, enterprise digitalization, and smart city solutions while working closely with global ecosystem partners to further enhance the energy saving value of e-paper in the AI era. To sum up: AI needs power; we, E Ink, saves power.

We would like to bring you more, some marketing information. Diversified and innovative applications continue to be an important foundation for our long-term growth.

This quarter we have seen our partners continue to introduce more color products while application scenarios further expanded, supporting the ongoing extension of the e-paper ecosystem. As you can see from the screen, in the e-reader and e-note segments, leading brands including BOOX, Bigme, [Hanvon?]

, iFlytek, iReader, Kindle, reMarkable, and Viwoods, you name it, have launched new products powered by the latest generation of e-paper technology, further increasing the adoption of e-paper applications. At the same time, e-paper is gradually expanding into the new device categories, such as Ledger's hardware wallet and [Breto's?]

e-paper smartphone case. This product launches reflect how e-paper application are gradually expanding beyond traditional reading devices into broader range of end-user categories, which over the longer term also supports the continued expansion of e-paper ecosystem across different application scenarios.

I think this page show different user application, and even a new application through different categories. From the top left, we partnered with Simple Mart Retail and M2COMM.

They're local Taiwanese retailer and Taiwan local SI to establish Taiwan first smart retail media network. Basically, this is the experience store centered on color e-paper at Simple Mart.

Also, our partner, [Aura?] , they launched the ink e-paper photo frame in US.

Also, InkJoy, [PicPac?] , and Japanese partner [Design?]

, Inc. have also introduced color e-paper photo frames.

Right in the middle, there is an electric guitar brand. It's called [Ciari?]

Guitars has introduced the world's first electric guitar featuring our [Prism?] technologies, color-changing technologies.

This model is called da Vinci. We also work with Japanese partner [Oricon?]

together with Tokyo Metropolitan Bureau of Transportation launched the sustainability-focused media platform. They call it Tokyo Sustainable Board, as you can see from the image on the right-hand side from the screen.

Okay. I think I just talked about the ISE, the exhibition we joined and more than 30 our partners also showcased the variety of the signage products.

We also joined NRF, another exhibition in the States, National Retail Federation. From the screen, the upper-left image shows a 32-inch e-paper smart signage solution jointly launched by Samsung and [Ambitech?]

Creative. The image right in the center, that's our Spectra 6 technology, basically that including Sharp/Dynabook's e-Signage professional displays, and also 75-inch large-format e-paper display panel, which can be used for immersive retail media, promotional messaging, and digital shelf communications.

We also prepare a video clip for your review. It's about the those the new product being showcased at ISE.

Please take a look. Please wait for a short while.

All right, here we go. All right.

The following page I'm going to talk about a bit about the ESG. CDP is one of the most important international organizations evaluating companies' environmental management and capabilities.

We received a double A list in CDP's climate change and water security assessments. Basically, this recognition not only demonstrates our concrete actions and strong commitment to addressing climate change and protecting water resources, but also reflects our outstanding performance in sustainability.

Also, in the S&P Global Corporate Sustainability Assessment, CSA, we achieved an outstanding 93 points, ranking highest in the global electronic equipment, instruments, and components industry for the second consecutive year. This score basically one point higher than the previous year, continued to set new industry record.

As a result, we were recognized among the top 1% of the companies worldwide in 2026 Sustainability Yearbook, reflecting our strong commitment to sustainable development. One of our most important activities, e-Read for the Future, this program we have doing it for 9 years already.

We came to Miaoli locally in Taiwan, where we partnered with 21 ecosystem partners to provide color e-paper and reading resources to local schools. Basically, this program promotes digital reading, reduces educational gaps, and supports long-term learning opportunities for students.

We also were named a sustainability-leading company in the manufacturing category by Ministry of Labor, acknowledging our focus on workplace safety. Locally in Taiwan, there is an annual Taiwan Global Brands—that's the name of the award.

We were being ranked number 20 among the Best Taiwan Global Brands with the brand value, dollar value US$132 million, with the year-over-year growth 26%. This recognition reflects the growing visibility of the e-paper ecosystem and our continuous innovation.

I think as you can see from the screen, we received the multiple recognitions at the Taiwan Corporate Sustainability Awards, I will not go into the details. Next page.

Last but not least, in the past, we primarily exhibited at Touch Taiwan, but this year we will not be there. We will be shifting our focus to COMPUTEX.

The e-paper technology has been developing for many years with a growing range of color display innovations. Through the COMPUTEX, a platform with a strong international visibility, we hope to attract more global buyers and partners, together with our ecosystem partners.

We will showcase comprehensive total solutions for e-paper application at that exhibition. If you happen to be Taiwan or if you really like our technology, you may consider to come to Taiwan early June.

We will be showcasing the latest and greatest technology together with our ecosystem partners from 2nd to 5th of June, and our booth will be located on D0101. Okay?

We sincerely welcome everyone to visit and explore the exhibition with us. Right, thank you.

We can move forward to the Q&A session.

We received a few questions online. The first one is the outlook of this year.

I think in last quarter, we provided the guidance about the 2026 outlook. I I believe our guidance remain the same.

We believe and we are expecting a year-over-year growth compared with 2025. We even believe the next year, '27, will be better than this year.

For for second quarter this year, I think we have the earning conference in in Mandarin I think 1 hour ago. One of the questions being raised, what will be happening to the to the second quarter?

Our guidance is, I think the second quarter last year was the record high, due to a lot of pull-ins. This quarter's this second quarter, we we we believe we may not be able to, beat the second quarter last year.

I think it will still be the the second best historically. Second quarter this year, we we believe still will will be quite good, even it will be second best.

Last year second second quarter, due to the pull-in, that was historically high. Second quarter this year remain to be to be quite good.

For first quarter this year, we believe we will be the year-over-year growth compared with the first quarter last year, okay? The second half remain to be seen, but the whole year, we believe it will be better than last year.

Okay. I'm I'm just I'm just reading those questions other questions online.

I think one question is about the our sixth line in Hsinchu, but our ninth line globally. H6, I think the the timeline is we basically will move in the equipment by end of this year, but it will start revving up next year.

We may need a quarter or two to get everything ready. That's sort of the the the timeline for H6.

One question is about the '27 outlook. What makes what what what makes we think the '27 '27 will be better than '26?

Why why we are so optimistic? I think let me put it in this way.

One of our strategy is to bring the color technology to the new products and and and new applications. From CE perspective, even under the macro uncertainty, we still it still show a year-over-year growth.

We believe with the color technology, we can still trigger further growth on CE. Of course, how soon it will go, I think it's a bit tied up with the macro uncertainty, but we still believe it will growing.

For ESL, we believe digitalization and automation basically will be the trend for ESL. From that perspective, we believe we are we are expecting organic growth on the ESL.

From that perspective, year-over-year growth, that's something we are expecting on ESL. For signage, also digitalization and automation seems to be the trend for outdoor signage.

Given those factor I just mentioned, that makes us to conclude the the further growth in the in the following two years. One of the question is relevant to the signage gross profit margin.

For for signage, I think the the business model to begin with still based on the module, because even we have a limited module capacity, but we we still have one one production line for for signage module. At the beginning, we will run we will be running the the module business.

I I think CE is also running the module business, you you should know the the gross profit margin. Once that particular signage production line is fully utilized, we will shift our business model from module to to material.

The the basically gross profit margin then will be similar to the material business we are having now. That's sort of the the the flavor I I I can provide on the signage gross profit margin.

I think one question is about the demand for ESL. As mentioned earlier, digitalization and automation definitely will be the trend for the retailers.

I think you you should be quite aware that Walmart project still ongoing, and it will be carried forward to next year. I I don't know when it will be ended next year, but we have a lot of, trial and and POC with other retailers.

Nothing really committed, but since I also mentioned we are we believe the ESL business is on on the organic growth mode, the the trend for ESL growth still quite intact from our perspective. That also, make us to conclude the ESL business will still be growing in the following two to three years.

Oh, there there's one question about yeah, another question about the H6. The the question goes like this.

Given the the fourth quarter softness, the company the the company has a plan to, defer H6 spending? I think I I just answered that question.

The the plan remained the same. For H6, the equipment will be moving this year, and we will start ramping up.

It may take a quarter or two, you know. The the plan remained the same.

Let let me let me elaborate a bit about the softness on on fourth quarter last year. I think due to the pull-in in first half last year, so that that effect or that that lead to the softness in the fourth quarter, you know.

Also, for CE, for ESL, that that basically is relatively low season for for this two business segments. Because for ESL, they they will not, adopt the the new technology during the, for example, Christmas.

For CE, for example, they they always, build the inventory before the Christmas, which is third quarter. Due to the pull-in happened in the first half last year, and also seasonality, as I mentioned, that basically led to the softness in in fourth quarter.

The the demand for ESL still intact, as I mentioned earlier. CE is a bit relevant to the macro uncertainty, but we still believe it will be growing this year and even next year.

Okay? There there's some question about the H5 ramps.

Are there any structural issues that could limit yield improvement reaching management target? Can we share more detail on what what operational bottlenecks might be related to currently?

The the H5 ramps so far so good. I I have to admit it it took relatively longer than we thought for for the ramps, because it's large format, you know.

We need a bigger size of the equipment, and this is the first time we manufacture large-sized e-paper, but so far so good. Yeah.

I I believe I Yeah, I pretty much answered all the questions. Okay.

Thank you for your participation. Yeah.

Yeah. Thank you very much.

Bye-bye.