Audiwei 2025 Annual Report Analysis: Operating Cash Flow Increased by 60.89% Asset Impairment Losses Increased by 178.77%

Core Profitability Indicators Analysis

Operating Revenue: Steady Growth of 10.72%, Driven by Smart Home and Smart Vehicle Segments

In 2025, the company achieved an operating revenue of 683M yuan, a year-on-year increase of 10.72%. By product, sensor business revenue was 573M yuan, a significant increase of 19.76%, with gross profit margin rising by 0.36 percentage points to 36.56%, mainly due to expansion of smart home application scenarios, increased packaging rate of intelligent driving solutions, and new sensor modules developed that received mass orders downstream; actuator business revenue was 89M yuan, down 29.29% year-over-year, with gross profit margin decreasing by 6.54 percentage points to 18.43%, due to reduced orders in overseas security consumer markets and the capacity upgrade of high-performance actuators not yet generating scaled revenue; technical service fees and other income totaled 14 million yuan, up 93.11%, but gross margin dropped sharply by 28.05 percentage points to 30.79%, mainly because costs increased far faster than revenue.

Net Profit and Non-Recurring Net Profit: Both Increasing but Growth Slowing

Net profit attributable to shareholders of the listed company was 94.03M yuan, up 7.27% year-over-year; non-recurring net profit was 88.46M yuan, up 9.01%. The slower growth compared to revenue is mainly due to a significant increase in asset impairment losses and rigid management expenses.

Earnings Per Share: Simultaneous Increase, Profit Quality Stable

Basic earnings per share were 0.67 yuan/share, up 8.06%; non-recurring EPS was 0.63 yuan/share, up 9.68%, consistent with the growth rates of net profit and non-recurring net profit, reflecting stable profit quality.

Cost and R&D Analysis

Period Expenses: Structural Differentiation, Continued Increase in R&D Investment

In 2025, total period expenses were 127 million yuan, a slight increase of 0.65%. Breakdown:

• Sales Expenses: 24.57M yuan, down 5.83%, mainly due to marketing expenses decreasing from 8.0336 million to 6.6296 million yuan, as the company optimized its marketing strategies;
• Management Expenses: 49.4088 million yuan, down 0.70%, with employee compensation decreasing from 32.3281 million to 30.2278 million yuan, controlling labor costs to some extent;
• Financial Expenses: -1.0372 million yuan (net income), up sharply by 91.24%, mainly because interest income dropped from 9.5496 million to 6.6359 million yuan, and exchange losses increased;
• R&D Expenses: 54.66M yuan, up 6.30%, accounting for 8.00% of revenue, with ongoing investments in lead-free piezoelectric ceramic sensors, high-temperature and high-pressure sensors, among other projects.

R&D Personnel: Team Expansion, Education Structure Optimization

At the end of 2025, R&D personnel totaled 167, a 7.74% increase, raising the proportion of total employees from 16.28% to 17.04%. Among them, master’s degree holders increased from 18 to 24, undergraduates from 98 to 109, and college or below from 39 to 34, continuously optimizing the educational structure to support technological innovation.

Cash Flow Analysis

Operating Cash Flow: Significant Increase of 60.89%, Improving Revenue Quality

In 2025, net cash flow from operating activities was 124M yuan, up 60.89%. The main reason is that cash received from sales of goods and services increased from 588 million to 653 million yuan, reflecting expanded revenue scale and improved collection quality; meanwhile, taxes paid increased from 22.7233 million to 36.5078 million yuan, indicating higher tax payments driven by profitability.

Investing Cash Flow: Narrowed Net Outflow, Increased Investment Scale

Net cash flow from investing activities was -81.5175 million yuan, a decrease of 15.43%. Cash recovered from investments was 718 million yuan, a significant increase of 225.6%, mainly due to expanded investment in wealth management products; cash paid for fixed assets, intangible assets, and other long-term assets was 64.8468 million yuan, down 13.12%, indicating a slowdown in capacity expansion.

Financing Cash Flow: Reduced Net Outflow, New Bank Loans

Net cash flow from financing activities was -34.0989 million yuan, a decrease of 37.05%. The company received 20 million yuan from new borrowings, while last year repaid 25 million yuan of bank loans, resulting in a net improvement of 45 million yuan; cash paid for dividends, profit distributions, or interest was 42.3999 million yuan, up 48.6%, mainly due to increased dividends.

Risk Factors Analysis

Continued Existing Risks

2. Quality Control Risks: As production scale expands and automation upgrades, product quality standards become stricter, increasing difficulty in quality control. Despite adopting advanced methods and optimizing systems, occasional quality issues may still occur.
3. Overseas Market Policy Risks: Uncertainties such as international trade policies, tariffs, and exchange rate fluctuations may adversely affect the company’s export business, which has a large overseas share.
4. Inventory Write-down and Gross Margin Fluctuation Risks: Large inventory levels pose risks if market demand changes or product prices fall, potentially leading to inventory impairments; rising raw material and labor costs may squeeze gross margins.

Emerging Risks

2. Raw Material Supply and Price Risks: Fluctuations in precious metals like gold and silver beyond the company’s control could increase production costs and pressure profit margins, prompting technological iteration.
3. Overseas Investment and Operational Risks: Construction of the Malaysia production base faces risks such as exchange rate volatility, political and economic instability, policy changes, and personnel management challenges, requiring hedging and localization strategies.

Management and Director Compensation Analysis

During the reporting period, the core executive compensation was as follows:

• Chairman Zhang Shuguang: pre-tax total of 2.3587 million yuan, as the company’s actual controller, with compensation linked to overall performance and annual assessment goals;
• General Manager Zhang Shuguang (same person as Chairman): included in the above amount;
• Vice President Liang Meiyi: pre-tax total of 1.7242 million yuan, responsible for board secretary and operations, meeting assessment targets;
• Financial Director Li Lei: pre-tax total of 1.4333 million yuan, responsible for financial management, meeting assessment targets.

Executive compensation is linked to company performance and individual evaluations, reflecting performance-based pay principles. The company also uses equity incentives to further align core team interests.

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