English Translation of a Report and Consolidated Financial Statements Originally Issued in Chinese

FARADAY TECHNOLOGY CORPORATION
AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT AUDITORS
FOR THE THREE MONTHS ENDED
MARCH 31, 2026 AND 2025

Address: No. 5 Li-Hsin Road III, Hsinchu Science Park, Hsinchu City, Taiwan, R.O.C.
Telephone: 886-3-578-7888

Notice to Readers

The reader is advised that these consolidated financial statements have been prepared originally in Chinese. In the event of a conflict between these financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language financial statements shall prevail.

EY安永

安永聯合會計師事務所

30078新竹市新竹科學園區力行一路1號E-3
E-3, No. 1, Lixing 1st Rd., Hsinchu Science Park
Hsinchu City, Taiwan, R.O.C.

電話 Tel: 886 3 688 5678
傳真 Fax: 886 3 688 6000
ey.com/zh_tw

Review Report of Independent Auditors

To Faraday Technology Corporation

Introduction

We have reviewed the accompanying consolidated balance sheets of Faraday Technology Corporation and its subsidiaries as of March 31, 2026 and 2025, the related consolidated statements of comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2026 and 2025, and notes to the consolidated financial statements, including the summary of significant accounting policies (together “the consolidated financial statements”). Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on these consolidated financial statements based on our reviews.

Scope of Review

Except as explained in the following paragraph, 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 conducted in accordance with the Standards on Auditing of the Republic of China 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.

Basis for Qualified Conclusion

As explained in Note 4(3), the financial statements of certain insignificant subsidiaries were not reviewed by independent auditors. Those statements reflect total assets of NT$2,446,934 thousand and NT$4,589,637 thousand, constituting 11.71% and 23.58% of the consolidated total assets, and total liabilities of NT$318,020 thousand and NT$542,631 thousand, constituting 4.90% and 9.39% of the consolidated total liabilities as of March 31, 2026 and 2025, respectively; and total comprehensive income of NT$(41,951) thousand and NT$(302,079) thousand, constituting (7.64)% and (148.70)% of the consolidated total comprehensive income for the three-month periods ended March 31, 2026 and 2025, respectively. The information related to above subsidiaries disclosed in Note 13 was also not reviewed by independent auditors.

A member firm of Ernst & Young Global Limited

EY安永

Qualified Conclusion

Based on our reviews, except for the effect of such adjustments, if any, as might have been determined to be necessary had the financial statements of certain insignificant subsidiaries and the information disclosed in the footnotes been reviewed by independent auditors described in the preceding paragraph, 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 Faraday Technology Corporation and its subsidiaries as of March 31, 2026 and 2025, and their consolidated financial performance for the three-month periods ended March 31, 2026 and 2025 and cash flows for the three-month periods ended March 31, 2026 and 2025, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, "Interim Financial Reporting" as endorsed and became effective by Financial Supervisory Commission of the Republic of China.

/s/ Hu, Shen-Chieh

/s/ Yang, Yu-Ni

Ernst & Young, Taiwan

May 14, 2026

Notice to Readers

The reader is advised that these financial statements have been prepared originally in Chinese. In the event of a conflict between these financial statements and the original Chinese version or difference in interpretation between the two versions, the Chinese language financial statements shall prevail.

The accompanying consolidated financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted and applied in the Republic of China.

A member firm of Ernst & Young Global Limited

English Translation of Consolidated Financial Statements Originally Issued in Chinese
FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, 2026, December 31, 2025 and March 31, 2025
(Expressed in thousands of New Taiwan Dollars)

Assets	Note	As of
		March 31, 2026	December 31, 2025	March 31, 2025
Current assets
Cash and cash equivalents	6(1)	$ 8,381,209	$ 7,265,576	$ 6,793,943
Financial assets at fair value through profit or loss, current	6(2)	20,192	20,454	23,292
Contract assets, current	6(17), 6(18), 7	122,506	12,052	33,367
Notes receivable, net	6(4), 6(18)	3,218	-	18,356
Accounts receivable, net	6(5), 6(18)	1,700,783	1,484,984	2,005,954
Accounts receivable - related parties, net	6(5), 6(18), 7	159,968	241,156	130,912
Other receivables		713,242	662,679	365,386
Current tax assets		5,627	10,626	7,115
Inventories, net	6(6)	1,120,195	955,459	2,525,571
Disposal group held for sale	6(26)	28,060	42,557	-
Other current assets	6(7), 7	230,357	303,787	345,290
Costs to fulfil a contract, current	6(17)	538,637	201,221	92,427
Total current assets		13,023,994	11,200,551	12,341,613
Non-current assets
Financial assets at fair value through profit or loss, non-current	6(2)	1,198,155	1,280,204	980,772
Financial assets at fair value through other comprehensive income, non-current	6(3)	3,269,533	2,911,070	2,429,458
Financial assets measured at amortized cost, non-current	6(8), 8	176,832	176,821	126,000
Property, plant and equipment	6(9)	650,614	616,626	622,172
Right-of-use assets	6(19)	641,895	630,879	727,187
Intangible assets	6(10), 6(25)	1,602,953	1,760,902	2,006,820
Deferred tax assets	4, 6(23)	119,366	109,461	80,912
Refundable deposits	7	52,156	56,352	91,546
Defined benefit assets, non-current	4, 6(14)	38,798	38,798	28,427
Other non-current assets	6(11)	121,232	150,582	29,121
Total non-current assets		7,871,534	7,731,695	7,122,415
Total assets		$ 20,895,528	$ 18,932,246	$ 19,464,028

The accompanying notes are an integral part of the consolidated financial statements.

Liabilities and Equity	Note	As of
		March 31, 2026	December 31, 2025	March 31, 2025
Current liabilities
Short-term loans	6(12)	$ 25,000	$ 25,000	$ 25,000
Financial liabilities at fair value through profit or loss, current	6(2), 6(25)	455	93,292	94,804
Contract liabilities, current	6(17), 7	2,244,861	1,422,397	1,083,925
Notes payable		4	4	4
Accounts payable		1,436,488	1,202,565	1,879,301
Accounts payable - related parties	7	687,070	446,832	365,871
Payables on equipment		748	1,208	45,189
Other payables	6(13)	1,061,596	1,225,893	1,124,715
Current tax liabilities	4, 6(23)	202,036	208,405	280,799
Liabilities directly associated with disposal groups held for sale	6(26)	14,985	13,975	-
Lease liabilities, current	6(19)	35,851	32,310	45,065
Other current liabilities		23,763	12,642	18,509
Total current liabilities		5,732,857	4,684,523	4,963,182
Non-current liabilities
Deferred tax liabilities	4, 6(23)	246,410	221,699	169,578
Lease liabilities, non-current	6(19)	280,536	269,077	305,354
Other non-current liabilities	6(13)	226,286	228,147	342,130
Total non-current liabilities		753,232	718,923	817,062
Total liabilities		6,486,089	5,403,446	5,780,244
Equity attributable to the parent company
Capital	6(15)
Common stock		2,605,503	2,605,503	2,605,503
Additional paid-in capital	6(15)	4,420,391	4,325,263	4,325,263
Retained earnings	6(15)
Legal reserve		2,178,455	2,178,455	2,073,387
Unappropriated earnings		3,091,528	2,987,265	3,480,573
Other components of equity		1,359,196	959,874	780,815
Equity attributable to the parent company		13,655,073	13,056,360	13,265,541
Non-controlling interests	6(15)	754,366	472,440	418,243
Total equity		14,409,439	13,528,800	13,683,784
Total liabilities and equity		$ 20,895,528	$ 18,932,246	$ 19,464,028

The accompanying notes are an integral part of the consolidated financial statements.

English Translation of Consolidated Financial Statements Originally Issued in Chinese

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three-month periods ended March 31, 2026 and 2025

(Expressed in thousands of New Taiwan Dollars, except for earnings per share)

	Note	For the three-month periods ended March 31
		2026	2025
Operating revenues	6(17), 7	$ 2,588,502	$ 7,437,577
Operating costs	6(6), 6(10), 6(20), 7	(1,364,067)	(5,929,568)
Gross profit		1,224,435	1,508,009
Operating expenses	6(10), 6(20), 7
Selling expenses		(114,097)	(110,085)
Administrative expenses		(195,409)	(156,994)
Research and development expenses		(812,744)	(852,897)
Expected credit losses	6(18)	(6,302)	(19,368)
Total operating expenses		(1,128,552)	(1,139,344)
Operating income		95,883	368,665
Non-operating income and expenses	6(21)
Interest income		23,503	19,165
Other income		30,410	74,683
Other gains and losses		31,942	(5,299)
Finance costs		(2,520)	(2,573)
Total non-operating income and expenses		83,335	85,976
Income before income tax		179,218	454,641
Income tax expense	4, 6(23)	(44,045)	(102,985)
Net income		135,173	351,656
Other comprehensive income (loss)	6(22)
Item that will not be reclassified subsequently to profit or loss:
Unrealized gains (loss) from equity instruments investments measured at fair value through other comprehensive income		358,463	(194,128)
Income tax relating to items that will not be reclassified to profit or loss		1,434	1,988
Item that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations		64,107	52,829
Income tax relating to items that may be reclassified to profit or loss		(9,856)	(9,195)
Other comprehensive income (loss) (net of income tax)		414,148	(148,506)
Total comprehensive income (loss)		$ 549,321	$ 203,150
Net income attributable to:
Stockholders of the parent		$ 104,263	$ 346,217
Non-controlling interests		30,910	5,439
		$ 135,173	$ 351,656
Comprehensive income attributable to:
Stockholders of the parent		$ 503,585	$ 190,856
Non-controlling interests		45,736	12,294
		$ 549,321	$ 203,150
Earnings per share (NT$)	6(24)
Earnings per share - basic		$ 0.40	$ 1.33
Earnings per share - diluted		$ 0.40	$ 1.33

English Translation of Consolidated Financial Statements Originally Issued in Chinese

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the three-month periods ended March 31, 2026 and 2025

(Expressed in thousands of New Taiwan Dollars)

	Equity Attributable to the Parent Company							Non-controlling Interests	Total Equity
	Common Stock	Additional Paid-in Capital	Retained Earnings	Repairing	Other Components of Equity	Exchange Differences on Translation of Foreign Operations	Unrealized Gain or Loss on Financial Assets Measured at Fair Value through Other Comprehensive Income
Balance as of January 1, 2025	$ 2,605,503	$ 4,325,263	$ 2,073,387	$ 3,134,356	$ (13,668)	$ 949,844	$ 13,074,685	$ 398,647	$ 13,473,332
Net income for the three-month period ended March 31, 2025	-	-	-	346,217	-	-	346,217	5,439	351,656
Other comprehensive income (loss) for the three-month period ended March 31, 2025	-	-	-	-	36,779	(192,140)	(155,361)	6,855	(148,506)
Total comprehensive income (loss) for the three-month period ended March 31, 2025	-	-	-	346,217	36,779	(192,140)	190,856	12,294	203,150
Non-controlling interests	-	-	-	-	-	-	-	7,302	7,302
Balance as of March 31, 2025	$ 2,605,503	$ 4,325,263	$ 2,073,387	$ 3,480,573	$ 23,111	$ 757,704	$ 13,265,541	$ 418,243	$ 13,683,784
Balance as of January 1, 2026	$ 2,605,503	$ 4,325,263	$ 2,178,455	$ 2,987,265	$ (64,927)	$ 1,024,801	$ 13,056,360	$ 472,440	$ 13,528,800
Net income for the three-month period ended March 31, 2026	-	-	-	104,263	-	-	104,263	30,910	135,173
Other comprehensive income for the three-month period ended March 31, 2026	-	-	-	-	39,425	359,897	399,322	14,826	414,148
Total comprehensive income for the three-month period ended March 31, 2026	-	-	-	104,263	39,425	359,897	503,585	45,736	549,321
Changes in ownership interests in subsidiaries	-	95,128	-	-	-	-	95,128	-	95,128
Non-controlling interests	-	-	-	-	-	-	-	236,190	236,190
Balance as of March 31, 2026	$ 2,605,503	$ 4,420,391	$ 2,178,455	$ 3,091,528	$ (25,502)	$ 1,384,698	$ 13,655,073	$ 754,366	$ 14,409,439

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in thousands of New Taiwan Dollars)

Description	For the three-month periods ended March 31		Description	For the three-month periods ended March 31
	2026	2025		2026	2025
Cash flows from operating activities:			Cash flows from investing activities:
Net income before tax	$ 179,218	$ 454,641	Acquisition of financial assets at fair value through other comprehensive income	$ -	$ (163,950)
Adjustments for non-cash gain or loss:
Depreciation	53,137	43,773	Acquisition of subsidiaries (net of cash received)	-	(37,747)
Amortization	191,180	181,269	Acquisition of property, plant and equipment	(67,882)	(22,737)
Expected credit loss	6,302	19,368	Disposal of property, plant and equipment	44	-
Loss on financial assets and liabilities at fair value through profit or loss	(10,526)	19,438	Increase in refundable deposits	(25)	(445)
Interest expense	2,520	2,573	Decrease in refundable deposits	31	8,195
Interest income	(23,503)	(19,165)	Acquisition of intangible assets	(186,182)	(172,376)
Dividend income	-	(72,364)	Net cash used in investing activities	(254,014)	(389,060)
Share-based payment expense	50,723	7,302
Others	(25)	99	Cash flows from financing activities:
Changes in operating assets and liabilities:			Increase in deposits for guarantees	-	180
Contract assets	(110,454)	(31,568)	Cash payments for the principal portion of the lease liabilities	(15,275)	(13,235)
Notes receivable	10,714	4,504	Changes in non-controlling interests	408,996	-
Accounts receivable	(222,101)	(1,228,728)	Net cash (used in) provided by financing activities	393,721	(13,055)
Accounts receivable - related parties	81,188	103,848	Effect of exchange rate changes on cash and cash equivalents	58,511	52,786
Other receivables	(51,443)	(96,290)
Inventories	(164,736)	(1,452,054)	Net increase (decrease) in cash and cash equivalents	1,102,185	(1,516,936)
Prepayments	116,206	(18,400)	Cash and cash equivalents at beginning of period	7,280,842	8,310,879
Other current assets	(8,981)	(18,168)	Cash and cash equivalents at end of period	$ 8,383,027	$ 6,793,943
Cost to fulfil a contract	(337,416)	(15,883)
Other operating assets	3,732	2,075	Reconciliation of the balances of cash and cash equivalents at end of period
Financial liabilities held for trading	-	(58)	Cash and cash equivalents balances on the consolidated balance sheets	$ 8,381,209	$ -
Contract liabilities	822,464	400,852	Cash and cash equivalents included in non-current assets held for sale	1,818	-
Accounts payable	236,235	808,060	Cash and cash equivalents at end of period	$ 8,383,027	$ -
Accounts payable - related parties	240,238	(237,489)
Other payables	(154,417)	(25,800)
Other current liabilities	11,121	(878)
Cash generated from operations	921,376	(1,169,043)
Interest received	24,142	22,050
Interest paid	(2,520)	(2,573)
Income tax paid	(39,031)	(18,041)
Net cash (used in) provided by operating activities	903,967	(1,167,607)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2026 AND 2025

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

1. History and Organization

Faraday Technology Corporation (the "Company") was incorporated on June 10, 1993. The Company is a leading fabless ASIC vendor and silicon intellectual property and system platform provider, with products and services of ASIC/SoC Design Services, ASIC/SoC Production Turnkey Services, and ASIC EDA tools.

The Company's shares are listed on the Taiwan Stock Exchange ("TWSE"). The address of its registered office and principal place of business is No. 5, Li-Hsin III Road, Hsinchu Science Park, Taiwan.

2. Date and Procedures of Authorization of Financial Statements for Issue

The consolidated financial statements of the Company and subsidiaries (the "Group") for the three-month periods ended March 31, 2026 and 2025 were authorized for issue in accordance with a resolution of the Board of Directors' meeting on May 14, 2026.

3. Newly Issued or Revised Standards and Interpretations

(1) Changes in accounting policies resulting from applying for the first time certain standards and amendments

The Group applied for the first time International Financial Reporting Standards, International Accounting Standards, and Interpretations issued, revised or amended which are recognized by Financial Supervisory Commission ("FSC") and become effective for annual periods beginning on or after January 1, 2026. The adoption of these new standards and amendments had no material impact on the Group.

(2) Standards or interpretations issued, revised or amended, by IASB which have not been endorsed by FSC, and not yet adopted by the Group as at the date when the Group's financial statements were authorized for issue, are listed below.

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued by IASB
a	IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures” — Sale or Contribution of Assets between an Investor and its Associate or Joint Ventures	To be determined by IASB

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued by IASB
b	IFRS 18 “Presentation and Disclosure in Financial Statements”	January 1, 2027 (Note)
c	Disclosure Initiative – Subsidiaries without Public Accountability: Disclosures (IFRS 19)	January 1, 2027
d	Translation to a Hyperinflationary Presentation Currency (Amendments to IAS 21 and IAS 29)	January 1, 2027

Note: On September 25, 2025, the FSC announced in a press release that Taiwan will adopt IFRS 18 in 2028. In addition, entities in Taiwan with a need for early adoption may elect to early adopt IFRS 18 upon approval by the FSC.

The abovementioned standards and interpretations issued by IASB have not yet endorsed by FSC at the date when the Group's financial statements were authorized for issue, the local effective dates are to be determined by FSC. As the Group is still currently determining the potential impact of the new or amended standards and interpretations listed under (b), it is not practicable to estimate their impact on the Group at this point in time. The remaining new or amended standards and interpretations have no material impact on the Group.

4. Summary of Significant Accounting Policies

(1) Statement of Compliance

The consolidated financial statements of the Group for the three-month periods ended March 31, 2026 and 2025 have been prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers ("the Regulations") and IAS 34 Interim Financial Reporting as endorsed and became effective by the FSC.

(2) Basis of Preparation

The consolidated financial statements have been prepared on a historical cost basis, except for financial instruments that have been measured at fair value. The consolidated financial statements are expressed in thousands of New Taiwan Dollars ("NT$") unless otherwise stated.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(3) Basis of consolidation

a. Preparation principle of consolidated financial statements

The same principles of consolidation have been applied in the Company's consolidated financial statements as those applied in the Company's consolidated financial statements for the year ended December 31, 2025. For the principles of consolidation, please refer to Note 4(3) of the Company's consolidated financial statements for the year ended December 31, 2025.

b. The consolidated entities are listed as follows:

Investor	Subsidiary	Main businesses	Percentage of ownership (%) As of
			March 31, 2026	December 31, 2025	March 31, 2025
The Company	Faraday Technology Corporation (USA)	Sales representative in America	100.00%	100.00%	100.00%
The Company	Faraday Technology Japan Corporation	Sales representative in Japan	99.95%	99.95%	99.95%
The Company	Faraday Technology Corp. (B.V.I.)	General investing	100.00%	100.00%	100.00%
The Company	Faraday Technology Vietnam Company Limited	IC designing service	100.00%	100.00%	100.00%
The Company	Sinble Technology Pte. Ltd. (Sinble)	IC designing service	100.00%	100.00%	100.00%
The Company	Chih-Hung Investment Corporation (Chih-Hung)	General investing	100.00%	100.00%	100.00%
The Company	Sheng Bang Investment Corporation (Sheng Bang)	General investing	100.00%	100.00%	100.00%
Sinble	GSME Vietnam Company Limited (Note 1, 2)	IC designing service	100.00%	100.00%	100.00%
Chih-Hung	Grain Media Inc.	IC designing, marketing and customer service	19.42%	19.42%	19.42%
Chih-Hung	Innopower Technology Corporation (Innopower)	Silicon Intellectual Property designing service	100.00%	100.00%	100.00%
(To be continued)

11 -

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Continued)

Percentage of ownership (%)

Investor	Subsidiary	Main businesses	As of
			March 31, 2026	December 31, 2025	March 31, 2025
Chih-Hung	FaradayTek Solutions India Private Limited	IC designing service	1.00%	1.00%	1.00%
Sheng Bang	Grain Media Inc.	IC designing, marketing and customer service	80.58%	80.58%	80.58%
Sheng Bang	FaradayTek Solutions India Private Limited	IC designing service	99.00%	99.00%	99.00%
Sheng Bang	Solid Silicon Technology Corporation	Silicon Intellectual Property designing service	100.00%	100.00%	100.00%
Innopower	Bright Capital Group Limited (BCGL)	General investing	100.00%	100.00%	100.00%
BCGL	Faraday Technology Corporation (Suzhou)	IC designing, marketing and customer service	100.00%	100.00%	100.00%
B.V.I.	Faraday Technology (Mauritius) Corp. (Mauritius)	General investing	100.00%	100.00%	100.00%
B.V.I.	GrainTech Electronics Limited	IC designing, marketing and customer service	100.00%	100.00%	100.00%
B.V.I.	Faraday Technology (Samoa) Corp. (Samoa)	General investing	100.00%	100.00%	100.00%
B.V.I.	Artery Technology Corporation (Artery) (Note 3)	General investing	49.86%	60.87%	60.87%
Samoa	United Business Service Corporation (UBS)	IC designing, marketing and customer service	100.00%	100.00%	100.00%
Artery	Artery Technology Co., Ltd.	IC designing, marketing and customer service	100.00%	100.00%	100.00%
Artery	Artery Technology Company	IC designing, marketing and customer service	100.00%	100.00%	100.00%
UBS	United Creative Solution Corporation	IC designing, marketing and customer service	100.00%	100.00%	100.00%
UBS	Innopower Technology Corporation (Chongqing)	IC designing, marketing and customer service	100.00%	100.00%	100.00%
Mauritius	Faraday Technology China Corporation	IC designing, marketing and customer service	100.00%	100.00%	100.00%

12 -

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Notes:

(1) In August 2025, Sinble Technology Vietnam Company Limited was renamed to GSME Vietnam Company Limited.

(2) In July 2025, Sinble resolved through a board resolution to dispose of its 100% capital contribution in GSME Vietnam Company Limited. Accordingly, the related assets and liabilities of GSME Vietnam Company Limited have been classified as a disposal group held for sale.

(3) For the three-month period ended March 31, 2026, Artery Technology Corporation (Artery) conducted a cash capital increase. As the Group did not participate in this capital increase, its ownership interest was reduced to 49.86%.

The financial statements of some of the consolidated subsidiaries listed above had not been reviewed by auditors. As of March 31, 2026 and March 31, 2025, the related assets of the subsidiaries which were unreviewed by auditors amounted to NT$2,446,934 thousand and NT$4,589,637 thousand, respectively, and the related liabilities amount to NT$318,020 thousand and NT$542,631 thousand, respectively. The comprehensive income of these subsidiaries amounted to NT$(41,951) thousand and NT$(302,079) thousand for the three-month periods ended March 31, 2026 and 2025, respectively.

(4) Except for the accounting policies listed under Note 4(5) - (6), the same accounting policies have been followed in the consolidated financial statements for the three-month period ended March 31, 2026 as were applied in the preparation of the Company's consolidated financial statements for the year ended December 31, 2025. For the summary of other significant accounting policies, please refer to the consolidated financial statements for the year ended December 31, 2025.

(5) Post-employment benefits

Pension cost for an interim period is calculated on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior financial year, adjusted and disclosed for significant market fluctuations since that time and for significant curtailments, settlements, or other significant one-off events.

(6) Income taxes

Interim period income tax expense is accrued using the tax rate that would be applicable to expected total annual earnings, that is, the estimated average annual effective income tax rate applied to the pre-tax income of the interim period. The estimated average annual effective income tax rate only includes current income tax. The recognition and measurement of deferred tax follows annual financial reporting requirements in accordance with IAS 12. The Group recognizes the effect of change in tax rate for deferred taxes in full if the new tax rate is enacted by the end of the interim reporting period, by charging to profit or loss, other comprehensive income, or directly to equity.

5. Significant Accounting Judgments, Estimates and Assumptions

The same significant accounting judgments, estimates and assumptions have been followed in the consolidated financial statements for the three-month periods ended March 31, 2026 and 2025 as were applied in the preparation of the Company's consolidated financial statements for the year ended December 31, 2025. Please refer to the consolidated financial statements for the year ended December 31, 2025.

6. Contents of Significant Accounts

(1) Cash and cash equivalents

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Cash on hand	$714	$651	$741
Checking and savings	3,797,416	2,785,184	3,685,705
Time deposits	4,513,079	4,409,741	3,037,497
Cash equivalents-commercial paper with repurchase agreements	70,000	70,000	70,000
Total	$8,381,209	$7,265,576	$6,793,943

(2) Financial assets and liabilities at fair value through profit or loss

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Financial assets mandatorily measured at fair value through profit or loss:
Funds	$20,192	$20,454	$23,292
Stocks	1,198,155	1,280,204	980,772
Total	$1,218,347	$1,300,658	$1,004,064

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Current	$20,192	$20,454	$23,292
Non-current	1,198,155	1,280,204	980,772
Total	$1,218,347	$1,300,658	$1,004,064

Financial liabilities at fair value through profit of loss:

Derivatives not designated as hedging instruments-forward currency

Contingent consideration in business combination

Total

Current	$455	$395	$899
	-	92,897	93,905
Non-current	-	-	-
Total	$455	$93,292	$94,804

Financial assets at fair value through profit or loss were not pledged.

(3) Financial assets at fair value through other comprehensive income

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Equity instrument investments measured at fair value through other comprehensive income – non-current:
Unlisted companies’ stocks	$3,269,533	$2,911,070	$2,429,458

The Group classified certain of its financial assets as financial assets at fair value through other comprehensive income which were not pledged.

The Group recognized dividend income related to equity instrument investments measured at fair value through other comprehensive income in the amount of NT$0 and NT$72,364 thousand for the three-month periods ended March 31, 2026 and 2025, respectively, which were all related to investments held at the end of the reporting period.

(4) Notes Receivable

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Notes Receivable - Arising from operations	$3,218	$-	$18,356
Less: loss allowance	-	-	-
Total	$3,218	$-	$18,356

Notes receivables were not pledged.

The Group follows the requirement of IFRS 9 to assess the impairment. Please refer to Note 6(18) for more details on loss allowance and Note 12 for details on credit risk.

(5) Accounts receivable, net and accounts receivable - related parties, net

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Accounts receivable (gross carrying amount)	$1,757,448	$1,535,347	$2,094,306
Less: loss allowance	(56,665)	(50,363)	(88,352)
Subtotal	1,700,783	1,484,984	2,005,954
Accounts receivable - related parties (gross carrying amount)	159,968	241,156	130,912
Total	$1,860,751	$1,726,140	$2,136,866

Accounts receivable were not pledged.

Accounts receivable are generally from immediate 7 days to month-end 60 days. The gross carrying amount of accounts receivable were NT$1,917,416 thousand, NT$1,776,503 thousand, and NT$2,225,218 thousand as of March 31, 2026, December 31, 2025, and March 31, 2025, respectively. Please refer to Note 6(18) for more details on impairment of accounts receivable, and Note 12 for credit risk disclosure.

(6) Inventories

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Work in process	$793,649	$660,171	$2,283,024
Finished goods	326,546	295,288	242,547
Total	$1,120,195	$955,459	$2,525,571

The cost of inventories recognized in expenses amounted to NT$1,364,067 thousand and NT$5,929,568 thousand for the three-month periods ended March 31, 2026 and 2025, respectively, including the inventory valuation loss NT$28,553 thousand and reversal gain NT$13,850 thousand for the three-month periods ended March 31, 2026 and 2025, respectively. The reversal gain of inventory loss allowance resulted from the sales of previous inventory write-downs during the three-month periods ended March 31, 2025.

No inventories were pledged.

(7) Other current assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Prepaid royalty fee	$119,242	$186,439	$276,052
Others	111,115	117,348	69,238
Total	$230,357	$303,787	$345,290

The prepaid royalty fee was primarily attributable to several agreements which the Group entered into for certain software license and silicon intellectual property license.

(8) Financial assets measured at amortized cost, non-current

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Corporate bond	$150,000	$150,000	$100,000
Time deposit	26,217	26,216	25,362
Others	615	605	638
Total	$176,832	$176,821	$126,000

Financial assets measured at amortized cost include corporate bonds and time deposits with original maturities more than one year or security deposit. Please refer to Note 8 for more details on financial assets measured at amortized cost under pledge and Note 12 for details on credit risk management.

(9) Property, plant and equipment

	As of
		March 31, 2026	December 31, 2025	March 31, 2025
Property, plant and equipment for its own use		$650,614	$616,626	$622,172
	Land	Buildings and facilities	Machinery and equipment	Computer equipment	Office furniture and fixtures
Cost:
As of January 1, 2026	$33,576	$626,155	$114,270	$289,700	$15,281
Additions	-	2,039	53,063	12,131	177
Disposal	-	(9,605)	-	(568)	(155)
Exchange effect	-	309	202	1,723	101
As of March 31, 2026	$33,576	$618,898	$167,535	$302,986	$15,404
					$6,416
As of January 1, 2025	$33,576	$624,624	$70,880	$227,692	$24,888
Additions	-	4,170	49,237	12,451	134
Disposal	-	(8,538)	(139)	(972)	(2,237)
Exchange effect	-	602	140	1,047	287
As of March 31, 2025	$33,576	$620,858	$120,118	$240,218	$23,072

18 -

	Land	Buildings and facilities	Machinery and equipment	Computer equipment	Office furniture and fixtures	Miscellaneous equipment	Total
Depreciation and impairment:
As of January 1, 2026	$-	$256,579	$49,414	$145,433	$13,531	$3,777	$468,734
Depreciation	-	5,109	6,545	21,302	442	509	33,907
Disposal	-	(9,605)	-	(524)	(155)	-	(10,284)
Exchange effect	-	231	202	1,285	109	17	1,844
As of March 31, 2026	$-	$252,314	$56,161	$167,496	$13,927	$4,303	$494,201
As of January 1, 2025	$-	$248,089	$34,652	$101,153	$20,687	$2,286	$406,867
Depreciation	-	4,702	3,428	16,202	1,111	457	25,900
Disposal	-	(8,538)	(139)	(972)	(2,237)	-	(11,886)
Exchange effect	-	302	140	771	291	12	1,516
As of March 31, 2025	$-	$244,555	$38,081	$117,154	$19,852	$2,755	$422,397
Net carrying amount as of:
March 31, 2026	$33,576	$366,584	$111,374	$135,490	$1,477	$2,113	$650,614
December 31, 2025	$33,576	$369,576	$64,856	$144,267	$1,750	$2,601	$616,626
March 31, 2025	$33,576	$376,303	$82,037	$123,064	$3,220	$3,972	$622,172

Note:

a. Significant components of buildings are main building structure, air conditioning units and elevators, which are depreciated based on their useful lives over 51 years, 8 years, and 6-16 years, respectively.

b. Property, plant and equipment were not pledged.

19 -

(10) Intangible assets

	Software	Goodwill	Technologies IP	Total
Cost
As of January 1, 2026	$2,705,546	$275,824	$371,053	$3,352,423
Addition – acquired separately	32,108	-	-	32,108
Decrease – derecognition	-	-	-	-
Exchange effect	8,814	-	-	8,814
As of March 31, 2026	$2,746,468	$275,824	$371,053	$3,393,345
As of January 1, 2025	$2,523,863	$275,824	$371,053	$3,170,740
Addition – acquired separately	73,710	-	-	73,710
Decrease – derecognition	-	-	-	-
Exchange effect	4,528	-	-	4,528
As of March 31, 2025	$2,602,101	$275,824	$371,053	$3,248,978
Accumulated Amortization
As of January 1, 2026	$1,555,961	$-	$35,560	$1,591,521
Amortization	186,542	-	4,638	191,180
Decrease – derecognition	-	-	-	-
Exchange effect	7,691	-	-	7,691
As of March 31, 2026	$1,750,194	$-	$40,198	$1,790,392
As of January 1, 2025	$1,038,833	$-	$17,007	$1,055,840
Amortization	176,631	-	4,638	181,269
Decrease – derecognition	-	-	-	-
Exchange effect	5,049	-	-	5,049
As of March 31, 2025	$1,220,513	$-	$21,645	$1,242,158
Net carrying amount as of:
March 31, 2026	$996,274	$275,824	$330,855	$1,602,953
December 31, 2025	$1,149,585	$275,824	$335,493	$1,760,902
March 31, 2025	$1,381,588	$275,824	$349,408	$2,006,820

20 -

The amortization expenses of intangible assets are as follows:

| | Three-month periods ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Operating costs | $6,529 | $6,529 |
| Operating expenses | | |
| Selling expenses | 1 | 1 |
| Administrative expenses | 258 | 364 |
| Research and development expenses | 184,392 | 174,375 |
| Total | $191,180 | $181,269 |

(11) Other non-current assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Long-term prepayments	$117,454	$146,763	$23,370
Others	3,778	3,819	5,751
Total	$121,232	$150,582	$29,121

The long-term prepayments were primarily attributable to several agreements which the Group entered into for certain silicon intellectual property license.

(12) Short-term loans

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Unsecured bank loans	$25,000	$25,000	$25,000
Interest rates applied (%)	2.2%-2.23%	2.23%	2.23%

The Group's unused credit limit from short-term loans were NT$1,048,395 thousand, NT$1,587,820 thousand and NT$1,635,240 thousand as of March 31, 2026, December 31, 2025, and March 31, 2025, respectively.

21 -

(13) Other non-current liabilities

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Deposits for Guarantees	$13,932	$-	$23,040
Long-term for share-based payment	56,159	-	-
Long-term payables for software license	156,195	228,147	319,090
Total	$226,286	$228,147	$342,130

The Group entered into software license agreements with several companies. As of March 31, 2026, December 31, 2025, and March 31, 2025, payments for future years are as follows:

Year of payment	As of
	March 31, 2026	December 31, 2025	March 31, 2025
2025	$-	$-	$377,155
2026	481,415	563,536	236,048
2027	115,437	167,690	134,383
2028	40,758	60,457	8,647
Subtotal	637,610	791,683	756,233
Less: Current portion (recognized as other payables)	(481,415)	(563,536)	(437,143)
Total	$156,195	$228,147	$319,090

(14) Post-employment benefits

Defined contribution plan

Expenses under the defined contribution plan for the three-month periods ended March 31, 2026 and 2025 are NT$13,628 thousand and NT$14,869 thousand, respectively.

22 -

Defined benefit plan

Expenses under the undefined benefit plan for the three-month periods ended March 31, 2026 and 2025 were nil.

(15) Equity

A. Capital stock

The Company’s authorized capital were NT$6,000,000 thousand, divided into 600,000 thousand shares (including 55,000 thousand shares reserved for exercise of employee stock options), as of March 31, 2026, December 31, 2025, and March 31, 2025, each at a par value of NT$10.

The Company’s issued capital were NT$2,605,503 thousand, divided into 260,550 thousand shares, as of March 31, 2026, December 31, 2025, and March 31, 2025. Each share has one voting right and a right to receive dividends.

B. Additional paid-in capital

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Premiums in excess of par	$4,214,345	$4,214,345	$4,214,345
Change in subsidiaries’ ownership	203,480	108,352	108,352
Employee stock option and others	2,566	2,566	2,566
Total	$4,420,391	$4,325,263	$4,325,263

According to the Company Act, the additional paid-in capital shall not be used except for offsetting deficit of the company. When a company does not have deficit, it may distribute the additional paid-in capital derived from the issuance of new shares at premiums in excess of par or income from endowments received by the Company. The distribution could be made in cash or in the form of dividend shares to its shareholders in proportion to the number of shares being held by each of them.

23 -

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

C. Retained earnings and dividend policies

According to the Company’s Articles of Incorporation, current year’s earnings, if any, shall be distributed in the following order:

a. Reserve for tax payments;
b. Offset accumulated losses in previous years, if any;
c. Legal reserve, which is 10% of leftover profits;
d. Allocation or reverse of special reserves as required by law or government authorities;
e. The remaining net profits and the retained earnings from previous years will be allocated as shareholders’ dividend. Except partial retained earnings will be distributed in future years, the distribution proposal is resolved by shareholder’s meeting.

The policy of dividend distribution should reflect factors such as the current and future investment environment, fund requirements, domestic and international competition and capital budgets; as well as the interest of the shareholders, share bonus equilibrium and long-term financial planning etc. The Board of Directors shall make the distribution proposal annually and present it at the shareholders’ meeting. The Company is in the growth stage, in order to plan for future funding requirement and long-term financial planning, and to satisfy shareholders’ need for cash dividend, cash dividends shall not be less than 10% of total dividends for distribution.

According to the Company Act, the Company needs to set aside amount to legal reserve unless where such legal reserve amounts to the total paid in capital. The legal reserve can be used to offset the deficit of the Company. When the Company does not have deficit, it may distribute the portion of legal reserve which exceeds 25% of the paid-in capital by issuing new shares or by cash in proportion to the number of shares being held by each of the shareholders.

When the Company distributing distributable earnings, it shall set aside to special reserve, an amount equal to “other net deductions from shareholders” equity for the current fiscal year, provided that if the company has already set aside special reserve according to the requirements for the adoption of IFRS, it shall set aside supplemental special reserve based on the difference between the amount already set aside and other net deductions from shareholders’ equity. For any subsequent reversal of other net deductions from shareholders’ equity, the amount reversed may be distributed from the special reserve.

Details of the 2025 and 2024 earnings distribution and dividends per share as approved and resolved by the board meeting and shareholders’ meeting on February 10, 2026, and May 23, 2025, respectively, are as follows:

24 -

	Appropriation of earnings		Dividend per share (NT$)
	2025	2024	2025	2024
Legal reserve	$73,963	$105,068	$-	$-
Common stock-cash dividend	468,990	781,651	1.8	3

Please refer to Note 6(20) for more details on employees' compensations and the remunerations to directors.

D. Non-controlling interests

	Three-month periods ended March 31
	2026	2025
Beginning balance	$472,440	$398,647
Income attributable to non-controlling interests	30,910	5,439
Other comprehensive income, attributable to non-controlling interests, net of tax:
Exchange differences on translation of foreign operations	14,826	6,855
Acquisition of new shares in a subsidiary not in proportionate to ownership interest	313,868	-
Issuance of employee stock options by the subsidiaries	(77,678)	7,302
Ending balance	$754,366	$418,243

(16) Share-based payment plans

A. Share-based payment plans of the subsidiary, Artery Technology Corporation

On December 27, 2021, and December 15, 2023, the board of directors issued and granted 2,442 thousand units and 3,000 thousand units of stock options to those who meet certain conditions, respectively, and each option unit could subscribe one common share of Artery Technology Corporation. The option holders may exercise the option rights upon two-year to four-year maturity from the grant of the options and from the date the shares of Artery Technology Corporation are primary listed on the Taiwan Stock Exchange or on the Taipei Exchange. When an employee exercises a stock option, a new share will be issued. On December 15, 2023, a resolution was passed by the Board of Directors to extend the duration of the stock options from six years to ten years in response to the needs of long-term plan.

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Artery Technology Corporation estimates compensation cost with the fair value method and uses the Black-Scholes option pricing model to estimate the fair value of the stock options on the grant date, with parameters and assumptions in consideration of the terms and conditions of the stock option plans.

The contract term of the aforementioned stock option plans is eight to ten years. If the option holders of Artery Technology Corporation are unable or find it difficult to exercise their stock options in accordance with the Company's relevant regulations due to applicable local laws or enforcement obstacles, the Company may agree with the option holders on appropriate alternative measures.

The information related to the aforementioned share-based payment plan is as follows:

Grant date of stock options	Total number of units issued (units in thousands)	Exercise price per unit (dollar)
December 27, 2021	2,442	NT$10
January 2, 2024	2,579	NT$60
August 1, 2024	232	NT$60
May 1, 2025	189	NT$60

In view of the aforementioned share-based payment plans, the valuation model and assumptions applied are as follows:

	May 1, 2025	August 1, 2024	January 2, 2024	December 27, 2021
Dividend yield (%)	0%	0%	0%	0%
Expected volatility (%)	43.45-44.96%	42.09-43.37%	41.48-42.39%	50.63%
Risk-free interest rates (%)	1.4678-1.4920%	1.5040-1.5191%	1.1971-1.2%	0.4082%
Expected life of stock options (year)	5-6 years	5-6 years	5-6 years	2 years
Fair value of stock option (NT$)	NT$28.68	NT$39.8	NT$41.99	NT$44.74
Option pricing model	Black-Scholes option pricing model	Black-Scholes option pricing model	Black-Scholes option pricing model	Black-Scholes option pricing model

The expected life of the stock options is based on historical data and current expectations and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may also not necessarily be the actual outcome.

Details of Artery Technology Corporation's employee stock option plans are as follows:

Options outstanding	Three-month period ended March 31, 2026		Three-month period ended March 31, 2025
	Number of stock options (in thousand units)	Weighted average exercise price (NT$)	Number of stock options (in thousand units)	Weighted average exercise price (NT$)
Beginning of the period	4,728	$38	4,650	$38
Granted in the current period	-	-	-	-
Exercised in the current period (Note 1)	(305)	60	-	-
Forfeited in the current period	(2,540)	24	(8)	60
Ending of the period	1,883	53	4,642	38
Exercisable as ending of the period (Note 2)	469	34	-	-
Weighted-average fair value of granted in the current period (NT$)	-		-

Note 1: The weighted average stock price on the exercise date of stock options for the three-month period ended March 31, 2026 amounted to NT$101.42.

Note 2: Among the exercisable units at the end of the period, some option holders wished to exercise their stock options, but execution was hindered due to local regulations. Appropriate alternative measures are still under negotiation.

The information on the abovementioned share-based payment plans as of March 31, 2026 and 2025 is as follows:

	Range of execution price/per unit	Weighted average remaining life (years)
As of March 31, 2026
Options outstanding	NT$10 - $60	1.90
As of December 31, 2025
Options outstanding	NT$10 - $60	1.19
As of March 31, 2025
Options outstanding	NT$10 - $60	1.93

B. Amendment to the share-based payment plans of the subsidiary, Artery Technology Corporation

For the three-month period ended March 31, 2026, Artery Technology Corporation amended its share-based payment plan. For eligible participants qualifying certain conditions, the equity-settled share-based payment method was changed to a cash-settled share-based payment method. The cash settlement of the share-based payment plan will be made after 4 to 40 months from the amendment date, provided the employees remain continuously employed by Artery Technology Corporation.

The incremental fair value arising from the amendment for the three-month period ended March 31, 2026 amounted to NT$260,167 thousand. The difference of NT$179,029 thousand between this amount and the previously recognized under additional paid-in capital - stock options amounted to NT$81,138 thousand will be recognized as expense on a straight-line basis over the remaining vesting period.

The measurement of the liability for the above cash-settled share-based payment plan is based on the fair value of the payment liability on the amendment date and at the end of each subsequent reporting period until the settlement date.

28 -

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Relevant information regarding the liabilities arising from share-based payment transactions is as follows:

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Current	$72,242	$-	$-
Non-current	56,159	-	-
Carry amount (Note)	$128,401	$-	$-
Total intrinsic value of vested units	$-	$-	$-

Note: Recorded separately under other payables - current and other non-current liabilities.

C. The expenses related to the share-based payment plans are as follows:

	Three-month periods ended March 31
	2026	2025
Equity-settled share-based payment	$3,460	$7,302
Cash-settled share-based payment	47,263	-
Total	$50,723	$7,302

(17) Operating revenue

Analysis of revenue from contracts with customers for the three-month periods ended March 31, 2026 and 2025 is as follows:

(1) Disaggregation of revenue

	Three-month periods ended March 31
	2026	2025
Sale of goods	$1,638,701	$6,580,750
Rendering of services	537,004	453,581
Silicon intellectual property license	412,797	403,246
Total	$2,588,502	$7,437,577

| | Three-month periods ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| Timing of revenue recognition: | | |
| At a point in time | $1,878,719 | $6,738,713 |
| Over time | 709,783 | 698,864 |
| Total | $2,588,502 | $7,437,577 |

(2) Contract balances

A. Contract assets – current

	As of
	March 31, 2026	December 31, 2025	March 31, 2025	January 1, 2025
Rendering of services	$122,506	$12,052	$33,367	$1,799

The significant changes in the Group's balances of contract assets for the three-month periods ended March 31, 2026 and 2025 are as follows:

	Three-month periods ended
	March 31
	2026	2025
The opening balance transferred to accounts receivable	$12,052	$1,799
Change in the progress of completion	125,614	31,612
Exchange rate changes	(3,108)	1,755

B. Contract liabilities – current

	As of
	March 31, 2026	December 31, 2025	March 31, 2025	January 1, 2025
Sales of goods	$1,703,760	$797,291	$973,476	$560,431
Rendering of services	504,210	607,459	83,513	110,683
Silicon intellectual property license	36,891	17,647	26,936	11,959
Total	$2,244,861	$1,422,397	$1,083,925	$683,073

The significant changes in the Group's balances of contract liabilities for the three-month periods ended March 31, 2026 and 2025 are as follows:

	Three-month periods ended March 31
	2026	2025
The opening balance transferred to revenue	$596,993	$424,751
Increase in receipts in advance during the period (netting the amount incurred and transferred to revenue during the same period)	1,419,457	825,603

C. Transaction price allocated to unsatisfied performance obligations

As of March 31, 2026, December 31, 2025 and March 31, 2025, there is no need to provide relevant information of the unsatisfied performance obligations as the contract terms with customers about the sales of goods are all shorter than one year. Besides, the summarized amount of transaction price allocated to unsatisfied performance obligations about rendering of services and silicon intellectual property license were NT$3,425,217 thousand, NT$3,647,220 thousand and NT$2,866,295 thousand, respectively. The Group will recognize revenue based on the stage of completion of the contracts. Those contracts are expected to complete within the next 1 to 1.5 years.

D. Assets recognized from costs to fulfil a contract

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Costs to fulfil a contract, current	$538,637	$201,221	$92,427

The costs to fulfil a contract are the costs incurred by the Group for non-recurring engineering projects, and will be recognized as operating costs when the performance obligations are satisfied.

For the three-month periods ended March 31, 2026 and 2025, amortization expenses amounted to NT$7,231 thousand and NT$1,281 thousand are recognized as operating costs, respectively.

(18) Expected credit losses

	Three-month periods ended
	March 31
	2026	2025
Operating expenses – Expected credit losses
Accounts receivable	$6,302	$19,368

Please refer to Note 12 for more details on credit risk.

The Group measures the loss allowance of its contract assets and accounts receivables (including notes receivable and accounts receivable) at an amount equal to lifetime expected credit losses. The assessments of the Group's loss allowance as of March 31, 2026, December 31, 2025 and March 31, 2025 are as follows:

i. the loss allowance of contract assets is measured at an amount equal to lifetime expected credit losses, details are as follows:

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Gross carrying amount	$125,549	$15,095	$36,410
Expected credit loss rates	0% - 100%	0% - 100%	0% - 100%
Loss allowance	(3,043)	(3,043)	(3,043)
Carry amount	$122,506	$12,052	$33,367

ii. the Group considers the grouping of accounts receivables by counterparties' credit rating, by geographical region and by industry sector, and its loss allowance is measured by using a provision matrix, details are as follows:

2026.03.31

Group 1	Not yet due (note)	Overdue						Total
		<=30 days	31-60 days	61-90 days	91-120 days	>=121 days
Gross carrying amount	$1,657,988	$118,299	$26,644	$1,528	$-	$47,058	$1,851,517
Expected credit loss rates	-%	-%	2%	10%	50%	100%
Lifetime expected credit losses	-	-	533	153	-	47,058	47,744
Subtotal	$1,657,988	$118,299	$26,111	$1,375	$-	$-	$1,803,773
Group 2	Not yet due	Overdue
---	---	---	---	---	---	---	---	---
		<=120 days	121-150 days	151-180 days	181-210 days	211-270 days	271-300 days	>=301 days
Gross carrying amount	$27,756	$30,330	$-	$-	$-	$4,219	$-	$6,812
Expected credit loss rates	-%	-%	-%	2%	10%	50%	80%	100%
Lifetime expected credit losses	-	-	-	-	-	2,109	-	6,812
Subtotal	$27,756	$30,330	$-	$-	$-	$2,110	$-	$-
Carrying amount

33 -

2025.12.31

Group 1	Not yet due	Overdue						Total
		<=30 days	31-60 days	61-90 days	91-120 days	>=121 days
Gross carrying amount	$1,643,926	$44,145	$5	$-	$-	$46,872	$1,734,948
Expected credit loss rates	-%	-%	2%	10%	50%	100%
Lifetime expected credit losses	-	-	-	-	-	46,872	46,872
Subtotal	$1,643,926	$44,145	$5	$-	$-	$-	$1,688,076
Group 2	Not yet due	Overdue
---	---	---	---	---	---	---	---	---
		<=120 days	121-150 days	151-180 days	181-210 days	211-270 days	271-300 days	>=301 days
Gross carrying amount	$30,523	$-	$-	$4,220	$-	$6,812	$-	$-
Expected credit loss rates	-%	-%	-%	2%	10%	50%	80%	100%
Lifetime expected credit losses	-	-	-	85	-	3,406	-	-
Subtotal	$30,523	$-	$-	$4,135	$-	$3,406	$-	$-
Carrying amount

2025.03.31

Group 1	Not yet due (note)	Overdue
		<=30 days	31-60 days	61-90 days	91-120 days	>=121 days
Gross carrying amount	$1,921,455	$127,026	$23,845	$10,235	$-	$47,879	$2,130,440
Expected credit loss rates	-%	-%	2%	10%	50%	100%
Lifetime expected credit losses	-	-	477	1,024	-	47,879	49,380
Subtotal	$1,921,455	$127,026	$23,368	$9,211	$-	$-	$2,081,060

Group 2		Overdue							Total
	Not yet due	<=120 days	121-150 days	151-180 days	181-210 days	211-270 days	271-300 days	>=301 days
Gross carrying amount	$27,676	$38,832	$-	$-	$1,929	$-	$29,591	$15,106	$113,134
Expected credit loss rates	-%	-%	-%	2%	10%	50%	80%	100%
Lifetime expected credit losses	-	-	-	-	193	-	23,673	15,106	38,972
Subtotal	$27,676	$38,832	$-	$-	$1,736	$-	$5,918	$-	$74,162
Carrying amount									$2,155,222

Note: Notes receivable were not yet due.

The movements in the provision for impairment of contract assets and accounts receivable for the three-month periods ended March 31, 2026 and 2025 are as follows:

	Contract assets	Accounts receivable
As of January 1, 2026	$3,043	$50,363
Increase for the current period	-	6,302
As of March 31, 2026	$3,043	$56,665
As of January 1, 2025	$3,043	$68,984
Increase for the current period	-	19,368
As of March 31, 2025	$3,043	$88,352

(19) Leases

The Group as lessee

The Group leases various properties, including real estate such as land and buildings, transportation equipment and office equipment. These leases have terms between 2 and 38 years.

35 -

The effect that leases have on the financial position, financial performance and cash flows of the Group are as follows:

A. Amounts recognized in the balance sheet

(a) Right-of-use asset

The carrying amount of right-of-use assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Land	$145,971	$147,157	$150,718
Buildings and facilities	495,399	483,165	572,484
Transportation equipment	-	-	3,334
Office equipment	525	557	651
Total	$641,895	$630,879	$727,187

During the three-month periods ended March 31, 2026 and 2025, the additions to right-of-use assets of the Group amounted to NT$27,607 thousand and NT$24,942 thousand, respectively.

(b) Lease liabilities

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Lease liabilities	$316,387	$301,387	$350,419
Lease liabilities-current	$35,851	$32,310	$45,065
Lease liabilities-noncurrent	280,536	269,077	305,354
Total	$316,387	$301,387	$350,419

Please refer to Note 6 (21) for the interest on lease liabilities recognized during the three-month periods ended March 31, 2026 and 2025, and refer to Note 12 (5) for the maturity analysis for lease liabilities as of March 31, 2026, December 31, 2025 and March 31, 2025.

B. Amounts recognized in the statement of comprehensive income

Depreciation charge for right-of-use assets

	Three-month periods ended March 31
	2026	2025
Land	$1,187	$1,187
Buildings and facilities	18,011	16,270
Transportation equipment	-	384
Office equipment	32	32
Total	$19,230	$17,873

C. Income and costs relating to leasing activities

	Three-month periods ended March 31
	2026	2025
The expense relating to short-term leases	$2,243	$3,492

D. Cash outflow relating to leasing activities

During the three-month periods ended March 31, 2026 and 2025, the Group's total cash outflow for leases amounted to NT$19,901 thousand and NT$19,162 thousand, respectively.

E. Other information relating to leasing activities

Extension option

Some of the Group's property rental agreement contain extension options. In determining the lease terms, the non-cancellable period for which the Group has the right to use an underlying asset, together with period covered by an option to extend the lease if the Group is reasonably certain to exercise that option. The options are used to maximize operational flexibility in terms of managing contracts. The majority of extension options held are exercisable only by the Group. After the commencement date, the Group reassesses the lease term upon the occurrence of a significant event or a significant change in circumstances that is within the control of the lessee and affects whether the Group is reasonably certain to exercise an option not previously included in its determination of the lease term, or not to exercise an option previously included in its determination of the lease term.

37 -

(20) Summary statement of employee benefits, depreciation and amortization expenses by function:

	Three-month periods ended March 31
	2026			2025
	Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
Employee benefits expense
Salaries	$23,128	$619,074	$642,202	$20,881	$609,390	$630,271
Labor and health insurance	2,144	48,390	50,534	2,087	48,858	50,945
Pension	815	12,813	13,628	782	14,087	14,869
Others	526	12,697	13,223	506	12,032	12,538
Depreciation	309	52,828	53,137	305	43,468	43,773
Amortization	6,529	184,651	191,180	6,529	174,740	181,269

According to the Articles of Incorporation, no less than 1% of profit of the current year is distributable as employees' compensation (as resolved in the shareholders' meeting on May 23, 2025, no less than 1% of profit of the current year is distributable as entry-level employees' compensation) and no more than 2% of profit of the current year is distributable as remuneration to directors. However, before distributing employees' compensation and remuneration to directors, the Company's profit should offset its accumulated losses, if any. The Company may, by a resolution adopted by a majority vote at a meeting of Board of Directors attended by two-thirds of the total number of directors, have the profit distributable as employees' compensation in the form of shares or in cash; and in addition, thereto a report of such distribution is submitted to the shareholders' meeting. Information on the Board of Directors' resolution regarding the employees' compensation and remuneration to directors can be obtained from the "Market Observation Post System" on the website of the TWSE.

Based on profit of the three-month period ended March 31, 2026, the Company estimated the amounts of the employees' compensation and remuneration to directors to be NT$4,941 thousand and NT$0, respectively. The Company recognized the amounts of the employees' compensation and remuneration to directors to be NT$4,941 thousand and NT$0, respectively, which were recognized as payroll expenses. Based on profit of the three-month period ended March 31, 2025, the Company recognized the amounts of the employees' compensation and remuneration to directors to be NT$25,850 thousand and NT$535 thousand, respectively. The Company recognized the amounts of the employees' compensation and remuneration to directors to be NT$25,850 thousand and NT$535 thousand, respectively, which were recognized as payroll expenses.

38 -

A resolution was approved in a meeting of the Board of Directors held on February 10, 2026 to distribute NT$36,463 thousand and NT$1,219 thousand in cash as employees' compensation and remuneration to directors, respectively. There were no differences between the aforementioned approved amounts and the amounts charged against earnings in 2025.

A resolution was approved in a meeting of the Board of Directors held on February 21, 2025 to distribute NT$51,926 thousand and NT$1,736 thousand in cash as employees' compensation and remuneration to directors, respectively. There were no differences between the aforementioned approved amounts and the amounts charged against earnings in 2024.

(21) Non-operating income and expenses

A. Interest income

	Three-month periods ended March 31
	2026	2025
Interest income
Financial assets measured at amortized cost	$23,503	$19,165

B. Other income

	Three-month periods ended March 31
	2026	2025
Dividend income	$-	$72,364
Other income - others	30,410	2,319
Total	$30,410	$74,683

C. Other gains and losses

	Three-month periods ended March 31
	2026	2025
Foreign exchange gains	$26,665	$17,415
Gain (losses) on financial assets and liabilities at fair value through profit or loss	10,526	(19,438)
Others	(5,249)	(3,276)
Total	$31,942	$(5,299)

39 -

D. Finance costs

	Three-month periods ended March 31
	2026	2025
Interest expenses on bank loans	$137	$138
Interest expenses on lease liabilities	2,383	2,435
Total	$2,520	$2,573

(22) Components of other comprehensive income

For the three-month period ended March 31, 2026

	Arising during the period	Reclassification adjustments during the period	Other comprehensive income, before tax	Income tax relating to components of other comprehensive income	Other comprehensive income, net of tax
Items that will not be reclassified subsequently to profit or loss:
Unrealized gains or losses from equity instruments investments measured at fair value through other comprehensive income	$358,463	$-	$358,463	$1,434	$359,897
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations	64,107	-	64,107	(9,856)	54,251
Total other comprehensive income	$422,570	$-	$422,570	$(8,422)	$414,148

40 -

For the three-month period ended March 31, 2025

	Arising during the period	Reclassification adjustments during the period	Other comprehensive income, before tax	Income tax relating to components of other comprehensive income	Other comprehensive income, net of tax
Items that will not be reclassified subsequently to profit or loss:
Unrealized gains or losses from equity instruments investments measured at fair value through other comprehensive income	$(194,128)	$-	$(194,128)	$1,988	$(192,140)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations	52,829	-	52,829	(9,195)	43,634
Total other comprehensive income	$(141,299)	$-	$(141,299)	$(7,207)	$(148,506)

(23) Income tax

The major components of income tax expense are as follows:

Income tax expense (income) recognized in profit or loss

	Three-month periods ended March 31
	2026	2025
Current income tax expense:
Current income tax payable	$29,239	$76,122
Deferred tax expense:
Deferred tax expense relating to origination and reversal of temporary differences	14,806	26,863
Total income tax expense	$44,045	$102,985

41 -

The assessment of income tax returns

As of March 31, 2026, the assessment of the income tax returns of the Company and its subsidiaries is as follows:

	The assessment of income tax returns
The Company	Assessed and approved up to 2024
Chih-Hung Investment Corporation	Assessed and approved up to 2024
Sheng Bang Investment Corporation	Assessed and approved up to 2024
Grain Media Inc.	Assessed and approved up to 2024
Innopower Technology Corporation	Assessed and approved up to 2023
Artery Technology Company	Assessed and approved up to 2024

(24) Earnings per share

Basic earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary equity holders of the parent entity by the weighted-average number of ordinary shares outstanding during the period.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent entity by the weighted-average number of ordinary shares outstanding during the period plus the weighted-average number of ordinary shares that would be issued assuming all the dilutive potential ordinary shares were converted into ordinary shares.

	Three-month periods ended March 31
	2026	2025
(a) Basic earnings per share
Profit attributable to ordinary equity owners of the parent	$104,263	$346,217
Weighted-average number of ordinary shares outstanding for basic earnings per share (in thousands)	260,550	260,550
Basic earnings per share (NT$)	$0.40	$1.33

| | Three-month periods ended
March 31 | |
| --- | --- | --- |
| | 2026 | 2025 |
| (b) Diluted earnings per share | | |
| Profit attributable to ordinary equity owners of the parent | $104,263 | $346,217 |
| Weighted-average number of ordinary shares outstanding for basic earnings per share (in thousands) | 260,550 | 260,550 |
| Effect of dilution: | | |
| Employee compensation (in thousands) | 141 | 245 |
| Weighted-average number of ordinary shares outstanding after dilution (in thousands) | 260,691 | 260,795 |
| Diluted earnings per share (NT$) | $0.40 | $1.33 |

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date the financial statements were authorized for issue.

(25) Business combinations

Acquisition of Solid Silicon Technology Corporation (Aragio)

To achieve strategic investment and synergy, the Group acquired 100% equity interest in Aragio on February 7, 2024. Aragio is based in the United States and specializes in silicon intellectual property design services.

Fair value of Identifiable Assets and Liabilities at Acquisition Date:

	Fair Value at Acquisition date
Assets
Cash and cash equivalent	$29,853
Accounts receivable	51,206
Other current assets	23,278
Property, plant and equipment	6,240
Intangible assets—Technology IP	371,053
Total	481,630

	Fair Value at Acquisition date
Liabilities
Accounts payable	$3,177
Contract liabilities	14,426
Other payables	7,979
Deferred tax liabilities	77,921
Total	103,503
Fair value of identifiable net assets	$378,127
Goodwill arising from acquisition:
	Amount
Purchase consideration	$653,951
Less: Net identifiable assets	(378,127)
Goodwill	$275,824

During the measurement period, the aforementioned matters were continuously reviewed, and adjustments were made in 2024, resulting in an increase of NT$7,933 thousand in the acquisition consideration, a decrease of NT$90,537 thousand in intangible assets – Technologies IP, and a decrease of NT$19,013 thousand in deferred tax liabilities, leading to an increase in goodwill of NT$79,457 thousand.

The goodwill of Aragio comprises the value of expected synergies arising from the acquisition and a customer list. According to the contractual terms imposed on acquisition, the customer list is not separable and therefore does not meet the criteria for recognition as an intangible asset under IAS 38 Intangible Assets.

From the date of acquisition until March 31, 2024, Aragio has contributed NT$6,375 thousand of revenue and NT$27,345 thousand to the net loss of the Group. If the combination had taken place at the beginning of 2024, revenue from the continuing operations would have been NT$2,610,520 thousand and the profit from continuing operations for the Group would have been NT$297,051 thousand.

44 -

Acquisition consideration

	Amount
Cash	$512,032
Contingent consideration liability (Acquisition Date)	141,919
Total consideration	$653,951
Analysis of cash flows on acquisition:
Transaction cost of the acquisition	$512,032
Less: Net cash acquired with the subsidiary	(29,853)
Net cash flows on acquisition	$482,179

Contingent consideration

In accordance with the purchase agreement with the previous shareholders of Aragio, a contingent consideration has been agreed. There will be additional cash payments to the previous shareholders of Aragio, if a certain profit base is achieved within 1 to 2 years after the acquisition date. The Group shall pay an additional US$5,000 thousand to the previous shareholders of Aragio. At the acquisition date, the fair value of the contingent consideration was estimated at NT$141,919 thousand. The fair value is determined using the DCF method.

Significant unobservable valuation inputs are listed below:

Discount rate 6%

Discount for non-performance risk -%

Significant increase (decrease) in the profit after tax of Aragio would result in higher (lower) fair value of the contingent consideration liability, while significant increase (decrease) in the discount rate and non-performance risk would result in lower (higher) fair value of the liability. During the three-month periods ended March 31, 2025, when the discount rate increases (decreases) by 1%, the profit after tax of the Group would increase/decrease by NT$894 thousand.

45 -

A reconciliation of fair value measurement of the contingent consideration liability is listed below:

	Three-month periods ended March 31
	2026	2025
Beginning balance	$92,897	$156,044
Unrealized fair value changes recognized in profit or loss	(92,897)	(24,392)
Payment	(Note)	(37,747)
Ending balance	$-	$93,905

Note: The fair value of contingent consideration liability will be due for final measurement and no payment was made to the previous shareholders on March 31, 2026.

(26) Disposal group held for sale

In July 2025, the Board of Directors of our subsidiary, Sinble, approved the proposed disposal of its 100% capital contribution in GSME Vietnam Company Limited. The Group reclassified the related assets and liabilities of GSME Vietnam Company Limited as a disposal group held for sale.

On March 31, 2026, the Group reclassified its related assets and liabilities as disposal group held for sale. The relevant information regarding these assets and liabilities is as follows:

	March 31, 2026
Assets of disposal group held for sale
Cash and cash equivalents	$1,818
Other receivables	1,930
Other current assets	2,094
Property, plant, and equipment	8,237
Right-of-use assets	12,032
Intangible assets	212
Refundable deposits	1,435
Other non-current assets	302
	28,060

46 -

	March 31, 2026
Liabilities directly associated with disposal group held for sale
Other payables	3,794
Lease liabilities-current	3,835
Lease liabilities-non-current	7,356
	14,985
Net carrying amount of disposal group held for sale	$13,075

7. Related Party Transactions

Information of the related parties that had transactions with the Group during the financial reporting period is as follows:

Name and nature of relationship of the related parties
Name of the related parties	Nature of relationship of the related parties
United Microelectronics Corporation	Entity with joint control or significant influence over the Company
United Semiconductor Japan Co., Ltd.	Other related parties
HeJian Technology (Suzhou) Co., Ltd.	Other related parties
Wavetek Microelectronics Corporation	Other related parties
United Semiconductor (Xiamen) Co., Ltd.	Other related parties
Unitedds Semiconductor (Shandong) Co., Ltd.	Other related parties

Significant transactions with the related parties

(1) Operating revenues

	Three-month periods ended March 31
	2026	2025
Entity with joint control or significant influence over the Company	$187,941	$175,871
Other related parties	15,161	17,837
Total	$203,102	$193,708

47 -

The Group's sales terms were from immediate 7 days to month-end 60 days. for non-related parties, while month-end 60 days for related parties. Selling prices for related parties were different from each other and a direct comparison was impractical since the products or services were customized based on each order.

(2) Purchases

	Three-month periods ended
	March 31
	2026	2025
United Microelectronics Corporation	$475,193	$573,823
United Semiconductor (Xiamen) Co., Ltd.	387,155	89,904
Other related parties	12,126	3,250
Total	$874,474	$666,977

The purchase price to the related parties above was determined through mutual agreement based on the market rates. The payment terms from the related party suppliers are month-end 45-60 days.

(3) Rental expenses

	Three-month periods ended
	March 31
	2026	2025
Entity with joint control or significant influence over the Company	$-	$1,178

Right-of-use assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
United Microelectronics Corporation	$3,451	$4,601	$-

Lease liabilities

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
United Microelectronics Corporation	$3,480	$4,632	$-

The Group leases offices from related parties, the transaction terms are negotiated by both parties, and the rent is paid on a monthly basis.

(4) Research expenses

	Three-month periods ended March 31
	2026	2025
Entity with joint control or significant influence over the Company	$584	$7,929

The payment terms from the related party suppliers are month-end 45-60 days.

(5) Contract assets

(6) Accounts receivable – related parties, net

49 -

(7) Other current assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Other related parties	$1,075	$51,138	$-

(8) Refundable deposits

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Entity with joint control or significant influence over the Company	$778	$778	$778

(9) Contract liabilities

(10) Accounts payable – related parties

50 -

(11) Key management personnel compensation

	Three-month periods ended March 31
	2026	2025
Short-term employee benefits	$53,139	$48,164
Post-employment benefits	243	243
Total	$53,382	$48,407

8. Assets Pledged as Collateral

The Group’s assets pledged as collateral were as follows:

Assets pledged for security	Carrying amount as of			Secured liabilities
	March 31, 2026	December 31, 2025	March 31, 2025
Financial assets measured at amortized cost, non-current	$16,000	$16,000	$15,230	Customs Import Guarantee
Financial assets measured at amortized cost, non-current	10,217	10,216	10,132	Science Park Administration land rental deposits
Financial assets measured at amortized cost, non-current	615	605	638	Office rental deposit
Total	$26,832	$26,821	$26,000

9. Significant Contingencies and Unrecognized Contractual Commitments

None.

10. Losses Due to Major Disasters

None.

11. Significant Subsequent Events

The Group disposed of its 100% equity interest of GSME Vietnam Company Limited on May 4, 2026 for a consideration of USD 1,600 thousand, and lost control on that date accordingly.

51 -

12. Others

(1) Categories of financial instruments

Financial assets

	As of
	March 31, 2026	December 31, 2025	March 31, 2025
Financial assets at fair value through profit or loss:
Mandatorily measured at fair value through profit or loss	$1,218,347	$1,300,658	$1,004,064
Financial assets at fair value through other comprehensive income	3,269,533	2,911,070	2,429,458
Financial assets measured at amortized cost (Note 1)	11,186,694	9,886,917	9,531,356
Total	$15,674,574	$14,098,645	$12,964,878

Financial liabilities

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

Note 1: Including cash and cash equivalents (exclude cash on hand), notes receivable, accounts receivable, other receivables, refundable deposits and financial assets measured at amortized cost.

Note 2: Please refer to Note 6 (26) for more details on amounts of assets and liabilities classified as a disposal group held for sale.

(2) Financial risk management objectives and policies

The Group’s principal financial risk management objective is to manage the market risk, credit risk and liquidity risk related to its operating activities. The Group identifies measures and manages the aforementioned risks based on the Group’s policy and risk exposures.

The Group has established appropriate policies, procedures and internal controls for financial risk management. Before entering into significant transactions, due approval process by the Board of Directors and Audit Committee must be carried out based on related protocols and internal control procedures. The Group complies with its financial risk management policies at all times.

(3) Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of the changes in market prices. Market prices comprise currency risk, interest rate risk and other price risk (such as equity instruments).

In practice, it is rarely the case that a single risk variable will change independently from other risk variables; there are usually interdependencies between risk variables. However, the sensitivity analysis disclosed below does not take into account the interdependencies between risk variables.

Foreign currency risk

The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenue or expense are denominated in a different currency from the Group’s functional currency) and the Group’s net investments in foreign subsidiaries.

53 -

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

The Group has certain foreign currency receivables denominated in the same foreign currency with certain foreign currency payables, therefore natural hedge is achieved. The Group also uses forward contracts to hedge the foreign currency risk on certain items denominated in foreign currencies. Hedge accounting is not applied as they did not qualify for hedge accounting criteria. Furthermore, as net investments in foreign subsidiaries are for strategic purposes, they are not hedged by the Group.

The foreign currency sensitivity analysis of the possible change in foreign exchange rates on the Group's profit is performed on significant monetary items denominated in foreign currencies as of the end of the reporting period. The Group's foreign currency risk is mainly related to the volatility in the exchange rates for USD and RMB. The information of the sensitivity analysis is as follows:

When NTD strengthens/weakens against USD by 10%, the profit for the three-month periods ended March 31, 2026 and 2025 would decrease/increase by NT$110,172 thousand and NT$134,192 thousand, respectively.

When NTD strengthens/weakens against RMB by 10%, the profit for the three-month periods ended March 31, 2026 and 2025 would decrease/increase by NT$239,063 thousand and NT$205,831 thousand, respectively.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group's exposure to the risk of changes in market interest rates primarily related to the Group's debt instrument investments at variable and fixed interest rates and bank loans with variable interest rates.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as at the end of the reporting period, including investments and loans with variable interest rates. At the reporting date, a rise/fall of 0.1% of interest rate in a reporting period could cause the profit for the three-month periods ended March 31, 2026 and 2025 to increase/decrease by NT$8,382 thousand and NT$6,894 thousand, respectively.

54 -

Equity price risk

The Group’s unlisted equity securities and other investments are susceptible to market price risk arising from uncertainties about future values of the investment objectives. The Group’s unlisted equity securities and other investment are classified under financial assets measured at fair value through profit or loss and financial assets measured at fair value through other comprehensive income. The Group manages the equity price risk through diversification. Reports on the equity portfolio are submitted to the Group’s top management for reviews and approvals on a regular basis.

Please refer to Note 12(9) for sensitivity analysis information of equity instruments whose fair value measurement is categorized under Level 3.

(4) Credit risk management

Credit risk is the risk that counterparty will not meet its obligations under a contract, leading to a financial loss. The Group is exposed to credit risk from operating activities (primarily for contract assets, accounts receivable and notes receivable) and from its financing activities, including bank deposits and other financial instruments.

Credit risk is managed by each business unit subject to the Group’s established policy, procedures and control relating to credit risk management. Credit limits are established for all trading partners based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Group’s internal rating criteria etc. Certain trading partners’ credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment.

As of March 31, 2026, December 31, 2025 and March 31, 2025, top ten customers represented 35%, 67% and 54% of the total contract assets and accounts receivable of the Group, respectively. The credit concentration risk of other contract assets and accounts receivable is insignificant.

Credit risk from balances with banks, fixed income securities and other financial instruments is managed by the Group’s treasury in accordance with the Group’s policy. The Group only transacts with counterparties approved by the internal control procedures, which are banks and financial institutions, companies and government entities with good credit rating and with no significant default risk. Consequently, there is no significant credit risk for these counterparties.

55 -

The Group adopted IFRS 9 to assess the expected credit losses. Except for contract assets and the trade receivables, the remaining debt instrument investments which are not measured at fair value through profit or loss, low credit risk for these investments is a prerequisite upon acquisition and by using their credit risk as a basis for the distinction of categories. An assessment is made at each reporting date as to whether the credit risk has substantially increased in order to determine the method of measuring the loss allowance and the loss ratio. The measurement indicators of the Group are described as follows:

Level of credit risk	Indicator	Measurement method for expected credit losses	Loss rate	Gross carrying amount
				As of
				March 31, 2026	December 31, 2025	March 31, 2025
Low credit risk	Rated as twAA-	12-month expected credit losses	0%	$100,000	$100,000	$100,000
Low credit risk	Rated as twAAA	12-month expected credit losses	0%	$50,000	$50,000	$-
Simplified approach (Note)	Not applicable	Lifetime expected credit losses	0%-100%	$2,046,183	$1,791,598	$2,279,984

Note: By using simplified approach loss allowance (lifetime expected credit losses) is measured at contract assets, notes receivable and accounts receivable.

(5) Liquidity risk management

The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of cash and cash equivalents, highly liquid equity investments, and bank borrowings. The table below summarizes the maturity profile of the Group's financial liabilities based on the contractual undiscounted payments and contractual maturity. The payment amounts include the contractual interest.

Non-derivative financial liabilities

	Less than 1 year	2 to 3 years	4 to 5 years	> 5 years	Total
As of March 31, 2026
Short-term loans	$25,550	$-	$-	$-	$25,550
Accounts payable
(including related parties)	2,123,562	-	-	-	2,123,562
Other payables	1,062,344	-	-	-	1,062,344
Long-term payables	-	212,354	-	-	212,354
Lease liabilities	45,608	63,985	36,221	266,311	412,125
As of December 31, 2025
Short-term loans	$25,558	$-	$-	$-	$25,558
Accounts payable
(including related parties)	1,649,401	-	-	-	1,649,401
Other payables	1,227,101	-	-	-	1,227,101
Long-term payables	-	228,147	-	-	228,147
Lease liabilities	43,140	56,299	33,718	269,565	402,722
As of March 31, 2025
Short-term loans	$25,558	$-	$-	$-	$25,558
Accounts payable
(including related parties)	2,245,176	-	-	-	2,245,176
Other payables	1,169,904	-	-	-	1,169,904
Long-term payables	-	319,090	-	-	319,090
Lease liabilities	58,387	73,800	44,289	286,962	463,438

Derivative financial assets (liabilities)

	Less than 1 year	2 to 3 years	4 to 5 years	> 5 years	Total
As of March 31, 2026
Inflows	$127,328	$-	$-	$-	$127,328
Outflows	(127,783)	-	-	-	(127,783)
Net	$(455)	$-	$-	$-	$(455)

	Less than
	1 year	2 to 3 years	4 to 5 years	> 5 years	Total
As of December 31, 2025
Inflows	$125,256	$-	$-	$-	$125,256
Outflows	(125,651)	-	-	-	(125,651)
Net	$(395)	$-	$-	$-	$(395)
As of March 31, 2025
Inflows	$131,614	$-	$-	$-	$131,614
Outflows	(132,513)	-	-	-	(132,513)
Net	$(899)	$-	$-	$-	$(899)

The table above contains the undiscounted net cash flows of derivative financial instruments.

(6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for three-month period ended March 31, 2026:

	Short-term loans	Lease liabilities
As of January 1, 2026	$25,000	$301,387
Cash flows	-	(15,275)
Non-cash flows
Additions	-	27,607
Reclassified to disposal group held for sale (Note)	-	1,302
Lease modification	-	(54)
Exchange rate changes	-	1,420
As of March 31, 2026	$25,000	$316,387

Note: Please refer to Note 6(26) for more details on lease liabilities reclassifying to directly associated with disposal groups held for sale.

Reconciliation of liabilities for three-month period ended March 31, 2025:

	Short-term loans	Lease liabilities
As of January 1, 2025	$25,000	$337,960
Cash flows	-	(13,235)
Non-cash flows
Additions	-	24,942
Lease modification	-	(730)
Exchange rate changes	-	1,482
As of March 31, 2025	$25,000	$350,419

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

(7) Fair values of financial instruments

a. The methods and assumptions applied in determining the fair value of financial instruments:

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used by the Group to measure or disclose the fair values of financial assets and financial liabilities:

i. The carrying amount of cash and cash equivalents, notes receivable and accounts receivable, other receivables, short-term loans, accounts payable and other payables approximate their fair value due to their short maturities.

ii. For financial assets traded in an active market with standard terms and conditions, their fair value is determined based on market quotation price (including listed equity securities and bonds etc.) at the reporting date.

iii. Fair value of equity instruments (including unlisted equity securities) without active market and market quotations cannot be reliably measured. Its amount is estimated using the market approach or asset approach based on parameters such as prices based on market transactions of equity instruments of identical or comparable entities and other relevant information.

iv. The financial assets measured at amortized cost, long-term payables and lease liabilities are determined by discounted cash flow analysis. The Group estimates the fair value based on book value due to the insignificant difference between the fair value from discounted cash flow analysis and carrying amount.

v. Fair value of financial liabilities without market quotations, bank loans and other non-current liabilities are determined based on the counterparty prices or valuation method. The valuation method uses DCF method as a basis, and the assumptions such as the interest rate and discount rate are primarily based on relevant information of similar instrument (such as yield curves published by the GreTai Securities Market, average prices for Fixed Rate Commercial Paper published by Reuters and credit risk, etc.)

59 -

vi. The fair value of derivative financial instruments is measured using publicly available quotations. When public quotations are not available, the fair value of non-option derivative financial instruments is determined using discounted cash flow analysis based on the applicable yield curve over their duration, while the fair value of option derivative financial instruments is calculated using an option pricing model.

b. Fair value of financial instruments measured at amortized cost

The carrying amount of the Group's financial instruments measured at amortized cost, except for cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable and other current liabilities approximate their fair value. The table below lists the fair value of other financial assets measured at amortized cost:

	Carrying amount
	March 31, 2026	December 31, 2025	March 31, 2025
Financial assets:
Financial assets measured at amortized cost
Corporate Bond	$150,000	$150,000	$100,000
	Fair value
	March 31, 2026	December 31, 2025	March 31, 2025

Financial assets:
Financial assets measured at amortized cost
Corporate Bond	$150,731	$150,812	$99,416

c. Fair value measurement hierarchy for financial instruments

Please refer to Note 12(9) for fair value measurement hierarchy for financial instruments of the Group.

(8) Derivative financial instruments

The related information for derivative financial instruments not qualified for hedge accounting and not yet settled as of March 31, 2026, December 31, 2025, and March 31, 2025 is as follows:

Forward exchange contracts

The Group entered into forward exchange contracts to manage its exposure to financial risk, but these contracts are not designated as hedging instruments. The table below lists the information related to forward exchange contracts:

Items (by contract)	Notional Amount	Contract Period
As of March 31, 2026
Forward exchange contract	Sell USD 4,000 thousand	From March 12, 2026 to April 23, 2026
As of December 31, 2025
Forward exchange contract	Sell USD 4,000 thousand	From December 10, 2025 to January 20, 2026
As of March 31, 2025
Forward exchange contract	Sell USD 4,000 thousand	From March 17, 2025 to April 24, 2025

(9) Fair value measurement hierarchy

(a) Fair value measurement hierarchy

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, based on the lowest level input that is significant to the fair value measurement as a whole. Level 1, 2 and 3 inputs are described as follows:

Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities that the entity can access at the measurement date

61 -

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

For assets and liabilities that are recognized in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorization at the end of each reporting period.

(b) Fair value measurement hierarchy of the Group’s assets and liabilities

The Group does not have assets that are measured at fair value on a non-recurring basis. Fair value measurement hierarchy of the Group’s assets and liabilities measured at fair value on a recurring basis is as follows:

As of March 31, 2026:

	Level 1	Level 2	Level 3	Total
Financial assets at fair value:
Financial assets at fair value through profit or loss
Funds	$-	$-	$20,192	$20,192
Stocks	-	-	1,198,155	1,198,155
Financial assets at fair value through other comprehensive income
Stocks	-	-	3,269,533	3,269,533
Financial liabilities at fair value:
Financial liabilities at fair value through profit or loss
Forward exchange contract	$-	$455	$-	$455

As of December 31, 2025:

	Level 1	Level 2	Level 3	Total
Financial assets at fair value:
Financial assets at fair value
through profit or loss
Funds	$-	$-	$20,454	$20,454
Stocks	-	-	1,280,204	1,280,204
Financial assets at fair value
through other comprehensive income
Stocks	-	-	2,911,070	2,911,070
Financial liabilities at fair value:
Financial liabilities at fair value
through profit or loss
Forward exchange contract	$-	$395	$-	$395
Contingent consideration arising in business combination (refer to note 6(25))	-	-	92,897	92,897

As of March 31, 2025:

63 -

	Level 1	Level 2	Level 3	Total
Financial liabilities at fair value:
Financial liabilities at fair value through profit or loss
Forward exchange contract	$-	$899	$-	$899
Contingent consideration arising in business combination (refer to note 6(25))	-	-	93,905	93,905

Transfers between Level 1 and Level 2 during the period

During the three-month periods ended March 31, 2026 and 2025, there were no transfers between Level 1 and Level 2 fair value measurements.

Movements of fair value measurement in Level 3 on recurring basis

Reconciliation for fair value measurements in Level 3 of the fair value hierarchy for movements during the period is as follows:

	Assets			Total
	At fair value through profit or loss		At fair value through other comprehensive income
	Stocks	Funds	Stocks
As of January 1, 2026	$1,280,204	$20,454	$2,911,070	$4,211,728
Total gains and losses recognized for the three-month period ended March 31, 2026:
Amount recognized in profit or loss (“other gains and losses”)	(82,049)	(262)	-	(82,311)
Amount recognized in other comprehensive income (“Unrealized gains (losses) from equity instruments investments measured at fair value through other comprehensive income”)	-	-	358,463	358,463
As of March 31, 2026	$1,198,155	$20,192	$3,269,533	$4,487,880

64 -

	Assets			Total
	At fair value through profit or loss		At fair value through other comprehensive income
	Stocks	Funds	Stocks
As of January 1, 2025	$1,024,515	$23,307	$2,459,636	$3,507,458
Total gains and losses recognized for the three-month period ended March 31, 2025:
Amount recognized in profit or loss (“other gains and losses”)	(43,743)	(15)	-	(43,758)
Amount recognized in other comprehensive income (“Unrealized gains (losses) from equity instruments investments measured at fair value through other comprehensive income”)	-	-	(194,128)	(194,128)
Acquisition in the three-month period ended March 31, 2025	-	-	163,950	163,950
As of March 31, 2025	$980,772	$23,292	$2,429,458	$3,433,522

Recognized as (loss) gain above, the loss from financial assets still held by the Group as of March 31, 2026 and 2025 was NT$82,311 thousand and NT$43,758 thousand, respectively.

Please refer to Note 6(25) for reconciliations information of contingent consideration arising from business combination.

Information on significant unobservable inputs to valuation

Description of significant unobservable inputs to valuation of recurring fair value measurements categorized within Level 3 of the fair value hierarchy is as follows:

As of March 31, 2026

	Valuation techniques	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity of the input to fair value
Financial assets:
At fair value through profit or loss
Fund	Net asset approach	Net asset approach	-	Not applicable	Not applicable
Stocks	Market Approach	Expected Price Ratio	37.75%	The higher the expected price ratio, the higher the fair value of the stocks.	When the expected price ratio increases (decreases) by 1%, the equity of the Group will increase/decrease by NT$1,428 thousand/(NT$1,342 thousand).
		Expected Volatility of Equity Value	66.01%	The higher the expected volatility of equity value, the lower the fair value of the stocks.	When the expected volatility of equity value increases (decreases) by 1%, the equity of the Group will (decrease by NT$1,903 thousand)/increase by NT$1,792 thousand.
At fair value through other comprehensive income
Stocks and others	Asset approach	Discount for lack of marketability and non-controlling interest	10%	The higher the discount for lack of marketability, the lower the fair value of the stocks	10% increase (decrease) in the discount for lack of marketability and non-controlling interest would result in decrease/increase in the Group’s equity by NT$321,070 thousand
	Market Approach	Discount for lack of marketability	25%	The higher the discount for lack of marketability, the lower the fair value of the stocks	10% increase (decrease) in the discount for lack of marketability would result in decrease/increase in the Group’s equity by NT$3,854 thousand
		Expected Volatility of Equity Value	57.95%	The higher the expected volatility of equity value, the lower the fair value of the stocks.	When the expected volatility of equity value increases (decreases) by 1%, the equity of the Group will (decrease by NT$59 thousand) increase by NT$53 thousand.

66 -

As of December 31, 2025

	Valuation techniques	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity of the input to fair value
Financial assets:
At fair value through profit or loss
Fund	Net asset approach	Net asset approach	-	Not applicable	Not applicable
Stocks	Market Approach	Expected Price Ratio	37.06%	The higher the expected price ratio, the lower the fair value of the stocks.	When the expected price ratio increases (decreases) by 1%, the equity of the Group will increase by NT$1,225 thousand (decrease by NT$1,394 thousand).
		Expected Volatility of Equity Value	66.93%	The higher the expected volatility of equity value, the lower the fair value of the stocks.	When the expected volatility of equity value increases (decreases) by 1%, the equity of the Group will (decrease by NT$1,922 thousand) increase by NT$1,794 thousand.
At fair value through other comprehensive income
Stocks and others	Asset approach	Discount for lack of marketability and non-controlling interest	10%	The higher the discount for lack of marketability, the lower the fair value of the stocks	10% increase (decrease) in the discount for lack of marketability and non-controlling interest would result in decrease/increase in the Group’s equity by NT$284,732 thousand
	Market Approach	Discount for lack of marketability	25%	The higher the discount for lack of marketability, the lower the fair value of the stocks	10% increase (decrease) in the discount for lack of marketability would result in decrease/increase in the Group’s equity by NT$3,855 thousand
		Expected Volatility of Equity Value	57.15%	The higher the expected volatility of equity value, the lower the fair value of the stocks.	When the expected volatility of equity value increases (decreases) by 1%, the equity of the Group will (decrease by NT$161 thousand) increase by NT$148 thousand.

67 -

As of March 31, 2025

68 -

Please refer to Note 6(25) for significant unobservable inputs information of contingent consideration arising from business combination.

Valuation process used for fair value measurements categorized within Level 3 of the fair value hierarchy

The Group's Financial Department is responsible for validating the fair value measurements and ensuring that the results of the valuation are in line with market conditions, based on independent and reliable inputs which are consistent with other information, and represent exercisable prices. The Group analyses the movements in the values of assets and liabilities which are required to be re-measured or re-assessed as per the Group's accounting policies at each reporting date.

(c) Fair value measurement hierarchy of the Group's assets and liabilities not measured at fair value but for which the fair value is disclosed

As of March 31, 2026

	Level 1	Level 2	Level 3	Total
Financial assets not measured at fair value but for which the fair value is disclosed:
Financial assets measured at amortized cost
Corporate Bond	$150,731	$-	$-	$150,731
As of December 31, 2025
	Level 1	Level 2	Level 3	Total
Financial assets not measured at fair value but for which the fair value is disclosed:
Financial assets measured at amortized cost
Corporate Bond	$150,812	$-	$-	$150,812

As of March 31, 2025

	Level 1	Level 2	Level 3	Total
Financial assets not measured at fair value but for which the fair value is disclosed:
Financial assets measured at amortized cost
Corporate Bond	$99,416	$-	$-	$99,416

(10) Information regarding the significant assets and liabilities denominated in foreign currencies is listed below:

	As of March 31, 2026			As of December 31, 2025
	Foreign currencies	Foreign exchange rate	NTD	Foreign currencies	Foreign exchange rate	NTD
Financial assets
Monetary items:
USD	$67,329	32.00	$2,154,519	$68,602	31.42	$2,155,500
RMB	526,981	4.631	2,440,449	442,697	4.496	1,990,364
Financial liabilities
Monetary items:
USD	$32,900	32.00	$1,052,796	$28,037	31.42	$880,908
RMB	10,758	4.631	49,820	18,008	4.496	80,964
	As of March 31, 2025
	Foreign currencies	Foreign exchange rate	NTD
Financial assets
Monetary items:
USD	$76,888	33.18	$2,551,153
RMB	484,265	4.572	2,214,059
Financial liabilities
Monetary items:
USD	$36,445	33.18	$1,209,233
RMB	34,066	4.572	155,751

70 -

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

The above information is disclosed based on the carrying amount of foreign currency (after conversion to functional currency).

Because there are several types of functional currencies within the Group, it is not practical to disclose the exchange gains and losses of monetary financial assets and liabilities by each significant asset and liability denominated in foreign currencies. The foreign exchange gain were NT$26,665 thousand and NT$17,415 thousand for the three-month periods ended March 31, 2026 and 2025, respectively.

(11) Capital management

The primary objective of the Group's capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximize shareholder value. The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust dividend payment to shareholders, return capital to shareholders or issue new shares.

Other disclosure

(1) Information related to significant transactions

Additional disclosures for information of the Group for the three-month period ended March 31, 2026:

(a) Financing provided to others for the three-month period ended March 31, 2026: None.
(b) Endorsement/Guarantee provided to others for the three-month period ended March 31, 2026: Please refer to Attachment 1.
(c) Significant securities held as of March 31, 2026: Please refer to Attachment 2.
(d) Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of the capital stock for the three-month period ended March 31, 2026: Please refer to Attachment 3.
(e) Receivables from related parties with amount exceeding the lower of NT$100 million or 20 percent of the capital stock for the three-month period ended March 31, 2026: Please refer to Attachment 4.

71 -

(f) Other: Significant intercompany transactions between consolidated entities: Please refer to Attachment 5.

(2) Information on investees

Information on investees which significant influenced or controlled by the Group: Please refer to Attachment 6.

(3) Information on investments in Mainland China

(a) Investee company name, main business and products, total amount of capital, method of investment, accumulated inflow and outflow of investments from Taiwan, percentage of ownership, investment income (loss), carrying amount of investments, cumulated inward remittance of earnings and limits on investment in Mainland China: Please refer to Attachment 7.

(b) Significant transaction to investee company in Mainland China for the three-month period ended March 31, 2026:

i. Purchases amount and percentage, and related ending balance and percentage of payables: None.

ii. Sales amount and percentage, and related ending balance and related ending balance and percentage of receivables: Please refer to Attachment 5.

iii. Property transaction amount and occurred gain (loss): None.

iv. Ending balance and purpose of endorsement/guarantee provided for notes or collateral: None.

v. Highest balance, ending balance, interest rate interval and total interest amount in current period of financing: None.

vi. Other transactions with significant influence on current period income or financial position: Please refer to Attachment 5.

72 -

14. Segment information

The products of the Company and its subsidiaries are all related to integrated circuit design products and the chief operating decision maker reviews the Group’s operating results as a whole to make decisions about resources to be allocated and assess its performance; therefore, the Group is considered a single segment. The preparation basis of the segment is the same with the preparation of this financial statements, and the policies are the same with those mentioned in Note 4, Summary of Significant Accounting Policies.

73 -

ATTACHMENT 1 (Endorsement/Guarantee provided to others for the three-month period ended March 31, 2026)

Unit: New Taiwan Dollars in thousands, and RMB in dollars

No. (Note 1)	Endorser/Guarantor	Receiving party		Limit of guarantee/endorsement amount for receiving party (Note 3)	Maximum balance for the period	Ending balance (Note 4)	Actual amount provided	Amount of collateral guarantee/endorsement	Percentage of accumulated guarantee amount to net assets value from the latest financial statement	Limit of total guarantee/endorsement amount (Note 5)	Endorsement guarantee from parent company to subsidiary	Endorsement guarantee from the subsidiary to the parent company	Endorsement guarantee for mainland areas
		Company name	Relationship (Note 2)
1	Artery Technology Corporation	Artery Technology Co., Ltd.	4	$671,060	$208,080	$208,080	$-	$-	13.95%	$671,060	N	N	Y
2	Artery Technology Corporation	Artery Technology Company	4	671,060	25,000	25,000	25,000	-	1.68%	671,060	N	N	N

Note 1: Faraday Technology Corporation and its subsidiaries are coded as follows:
1. Faraday Technology Corporation is coded "0".
2. The subsidiaries are coded consecutively beginning from "1" in the order presented in the table above.

Note 2: There are the following 7 types of relationships between the endorsement guarantor and the object of the endorsement, and the type can be indicated:
1. A company with which it does business.
2. A company in which the public company directly and indirectly holds more than 50% of the voting shares.
3. A company that directly and indirectly holds more than 50% of the voting shares in the public company.
4. A company in which the public company holds, directly or indirectly, 90% or more of the voting shares.
5. A company that fulfills its contractual obligations by providing mutual endorsements/guarantees for another company in the same industry or for joint builders for purposes of undertaking a construction project.
6. A company that all capital contributing shareholders make endorsements/guarantees for their jointly invested company in proportion to their shareholding percentages.
7. Companies in the same industry provide among themselves joint and several security for a performance guarantee of a sales contract for pre-construction homes pursuant to the Consumer Protection Act for each other.

Note 3: According to the regulations of Artery Technology Corporation's endorsement guarantee operation method:
1. Limit of total guarantee/endorsement amount shall not exceed 45% of Artery Technology Corporation's net worth as stated in the latest financial statements.
2. The amount of endorsements/guarantees for any single entity shall not exceed 45% of Artery Technology Corporation's net worth as stated in the latest financial statementst.
3. Artery Technology Corporation and its subsidiaries endorsements/guarantees to others shall not exceed 45% of Artery Technology Corporation's net worth as stated in the latest financial statements.
4. Artery Technology Corporation and its subsidiaries endorsements/guarantees for any single entity shall not exceed 45% of Artery Technology Corporation's net worth as stated in the latest financial statements.
5. The amount of endorsements/guarantees for a company which endorser/guarantee does business with, except the ceiling rules abovementioned shall not exceed the needed amounts arising from business dealings which is the higher amount of total sales or purchase transactions between endorser/guarantee and the receiving party.

Note 4: Amounts denominated in foreign currency is translated into New Taiwan Dollars by using customs administration's average exchange rate in March 2026.

ATTACHMENT 2 (Significant securities held as of March 31, 2026) (Excluding subsidiaries and associates)

Faraday Technology Corporation

Type of securities	Name of securities	Relationship	Financial statement account	As of March 31, 2026				Note
				Units/shares	Carrying amount	Percentage of ownership (%)	Fair value
Common Stock	SHIEH YONG Investment Co., Ltd.	-	Financial assets at fair value through other comprehensive income, non-current	245,581,763	$2,728,462	12.12%	$2,728,462	-
Common Stock	Unitech Capital Inc.	-	Financial assets at fair value through other comprehensive income, non-current	2,500,000	49,167	5.00%	49,167	-
Corporate Bond	United Microelectronics Corporation	-	Financial assets measured at amortized cost, non-current	50 bonds	50,000	-	49,939	(Note)
Corporate Bond	China Steel Corporation	-	Financial assets measured at amortized cost, non-current	50 bonds	50,000	-	50,207	(Note)
Corporate Bond	Taiwan Semiconductor Manufacturing Company, Ltd.	-	Financial assets measured at amortized cost, non-current	50 bonds	50,000	-	50,585	(Note)

Chih-Hung Investment Corporation

Type of securities	Name of securities	Relationship	Financial statement account	As of March 31, 2026				Note
				Units/shares	Carrying amount	Percentage of ownership (%)	Fair value
Common Stock	SanJet Technology Corporation	-	Financial assets at fair value through other comprehensive income, non-current	3,000,000	$-	9.53%	$-	-
Preferred stock	Gear Radio Limited	-	Financial assets at fair value through other comprehensive income, non-current	1,200,000	-	2.79%	-	-
Preferred stock	NeuroSky	-	Financial assets at fair value through other comprehensive income, non-current	44,312,575	-	6.15%	-	-
Preferred stock	Floadia	-	Financial assets at fair value through other comprehensive income, non-current	1,818	-	7.21%	-	-
Common Stock	Hsun Chieh Capital Corp.	-	Financial assets at fair value through other comprehensive income, non-current	3,000,000	77,336	15.00%	77,336	-
Preferred stock	HamminX Ltd.	-	Financial assets at fair value through other comprehensive income, non-current	2,500,000	160,000	13.51%	160,000	-

ATTACHMENT 2 (Significant securities held as of March 31, 2026) (Excluding subsidiaries and associates)

Sheng Bang Investment Corporation

Note : Each at a bond value of NT$1,000 thousand.

ATTACHMENT 3 (Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of capital stock)

Faraday Technology Corporation

Counter-party	Relationship	Transactions					Notes and accounts receivable (payables)
		Purchases (Sales)	Amount	Percentage of total purchases (sales)	Term	Details of non-arm's length transaction	Balance	Percentage of total receivables (payables)	Note
United Microelectronics Corporation	Entity with joint control or significant influence over the Company	Purchases	$299,373	31.94%	Month-end 60 days	-	$(225,863)	14.23%	-
United Microelectronics Corporation	Entity with joint control or significant influence over the Company	Sales	187,941	11.40%	Month-end 60 days	-	149,984	7.66%	-
United Semiconductor (Xiamen) Co., Ltd.	Other related parties	Purchases	157,716	16.83%	Month-end 60 days	-	(128,788)	8.11%	-

Artery Technology Co., Ltd.

Counter-party	Relationship	Transactions					Notes and accounts receivable (payables)
		Purchases (Sales)	Amount	Percentage of total purchases (sales)	Term	Details of non-arm's length transaction	Balance	Percentage of total receivables (payables)	Note
United Semiconductor (Xiamen) Co., Ltd.	Other related parties	Purchases	$104,189	23.05%	Month-end 60 days	-	$(32,536)	13.87%	-

Artery Technology Company

ATTACHMENT 4 (Receivables from related parties with amount exceeding the lower of NT$100 million or 20 percent of the capital stock)

Counter-party	Relationship	Ending Balance of Notes/Accounts Receivables from Related Party	Turnover Rate	Overdue		Amount Received in Subsequent Period	Allowance for doubtful accounts
				Amount	Action Taken
United Microelectronics Corporation	Entity with joint control or significant influence over the Company	$149,984	3.85	$-	-	$123,682	$-

78 -

ATTACHMENT 5 (Significant intercompany transactions between consolidated entities)

No. (Note 1)	Related Party	Counterparty	Relationship with the Company (Note 2)	Transactions
				Account	Amount	Term	Percentage of consolidated operating revenues or consolidated total assets (Note 3)
0	Faraday Technology Corporation	Faraday Technology Corporation (USA)	1	Operating revenue	$287,501	Note 4	11.11%
0	Faraday Technology Corporation	Faraday Technology Corporation (USA)	1	Accounts receivable	268,786	Month-end 60 days	1.29%
0	Faraday Technology Corporation	Faraday Technology Corporation (USA)	1	Contract Liabilities	4,263	According to the contract	0.02%
0	Faraday Technology Corporation	Faraday Technology Japan Corporation	1	Operating revenue	120,198	Note 4	4.64%
0	Faraday Technology Corporation	Faraday Technology Japan Corporation	1	Accounts receivable	93,463	Month-end 60 days	0.45%
0	Faraday Technology Corporation	Faraday Technology Japan Corporation	1	Contract Liabilities	6,790	According to the contract	0.03%
0	Faraday Technology Corporation	FaradayTek Solutions India Private Limited	1	Research expenses	8,268	According to the contract	0.32%
0	Faraday Technology Corporation	Faraday Technology Vietnam Company Limited	1	Research expenses	87,504	According to the contract	3.38%
0	Faraday Technology Corporation	Faraday Technology Vietnam Company Limited	1	Other payables	87,504	Month-end 60 days	0.42%
0	Faraday Technology Corporation	GrainTech Electronics Limited	1	Operating revenue	2,259	Note 5	0.09%
0	Faraday Technology Corporation	GrainTech Electronics Limited	1	Accounts receivable	2,301	Month-end 60 days	0.01%
0	Faraday Technology Corporation	Sinble Technology Pte. Ltd.	1	Operating revenue	10,752	Note 5	0.42%
0	Faraday Technology Corporation	Sinble Technology Pte. Ltd.	1	Research expenses	102,518	According to the contract	3.96%
0	Faraday Technology Corporation	Sinble Technology Pte. Ltd.	1	Contract Assets	10,752	According to the contract	0.05%
0	Faraday Technology Corporation	Innopower Technology Corporation	1	Operating revenue	119,186	Note 5	4.60%
0	Faraday Technology Corporation	Innopower Technology Corporation	1	Accounts receivable	179,884	Month-end 60 days	0.86%
0	Faraday Technology Corporation	Innopower Technology Corporation	1	Other receivable	108,576	Month-end 60 days	0.52%

79 -

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

ATTACHMENT 5 (Significant intercompany transactions between consolidated entities)

No. (Note 1)	Related Party	Counterparty	Relationship with the Company (Note 2)	Transactions
				Account	Amount	Term	Percentage of consolidated operating revenues or consolidated total assets (Note 3)
0	Faraday Technology Corporation	Faraday Technology Corporation (Suzhou)	1	Operating revenue	$14,111	Note 5	0.55%
0	Faraday Technology Corporation	Faraday Technology Corporation (Suzhou)	1	Contract Assets	8,303	According to the contract	0.04%
0	Faraday Technology Corporation	Faraday Technology Corporation (Suzhou)	1	Accounts receivable	18,720	Month-end 60 days	0.09%
0	Faraday Technology Corporation	United Creative Solution Corporation	1	Operating revenue	80,064	Note 5	3.09%
0	Faraday Technology Corporation	United Creative Solution Corporation	1	Contract Assets	134,700	According to the contract	0.64%
0	Faraday Technology Corporation	United Creative Solution Corporation	1	Accounts receivable	59,324	Month-end 60 days	0.28%
0	Faraday Technology Corporation	United Creative Solution Corporation	1	Contract Liabilities	3,028	According to the contract	0.01%
0	Faraday Technology Corporation	Faraday Technology China Corporation	1	Operating revenue	187,645	Note 5	7.25%
0	Faraday Technology Corporation	Faraday Technology China Corporation	1	Contract Assets	3,020	According to the contract	0.01%
0	Faraday Technology Corporation	Faraday Technology China Corporation	1	Accounts receivable	74,637	Month-end 60 days	0.36%
0	Faraday Technology Corporation	Faraday Technology China Corporation	1	Contract Liabilities	39,342	According to the contract	0.19%
1	Artery Technology Co., Ltd.	Artery Technology Company	3	Operating revenue	20,583	Note 5	0.80%
1	Artery Technology Co., Ltd.	Artery Technology Company	3	Accounts receivable	9,289	Month-end 30 days	0.04%
1	Artery Technology Co., Ltd.	Artery Technology Company	3	Purchases	206,107	Note 5	7.96%
1	Artery Technology Co., Ltd.	Artery Technology Company	3	Accounts payable	158,095	Month-end 30 days	0.76%

80 -

Note 2: Transactions are categorized as follows:
1. The holding company to subsidiary
2. Subsidiary to holding company
3. Subsidiary to subsidiary

Note 3: The percentage with respect to the consolidated asset/liability for transactions of balance sheet items are based on each item's balance at period-end.

For profit or loss items, cumulative balances are used as basis.

Note 4: The sales price to the above related parties was determined through mutual agreement in reference to resale price.

Note 5: As the sale of product or service is individually designed based on requirement of customers, the sales price was determined through mutual agreement.

81 -

ATTACHMENT 6 (Related information of investee companies)

Investee company	Location	Main businesses and products	Initial Investment (Note 1)		Investment as of March 31, 2026			Net income (loss) of investee company	Investment income (loss) recognized
			March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount
Faraday Technology Corporation (USA)	California, USA	Sales representative in America	$403,600	$403,600	Common stock 118,580 thousand shares and preferred stock 2,000 thousand shares	Common stock owned 100.00% and preferred stock owned 100.00%	$415,832	$17,828	$17,828
Faraday Technology Corp. (B.V.I.)	British Virgin Islands	General investing	855,770	855,770	Common stock 27,489 thousand shares	100.00%	1,298,438	37,422	37,422
Faraday Technology Japan Corporation	Tokyo, Japan	Sales representative in Japan	29,320	29,320	Common stock 2 thousand shares	99.95%	203,235	3,748	3,746
Chih-Hung Investment Corporation	Taiwan	General investing	699,500	699,500	Common stock 92,522 thousand shares	100.00%	431,385	(58,775)	(58,775)
Sheng Bang Investment Corporation	Taiwan	General investing	2,197,020	2,067,020	Common stock 223,651 thousand shares	100.00%	2,294,524	(2,307)	(2,307)
Faraday Technology Vietnam Company Limited	Vietnam	IC design services	536,259	536,259	-	100.00%	536,721	17,307	17,307
Sinble Technology Pte. Ltd.	Singapore	IC design services	179,400	179,400	Common stock 7,100 thousand shares	100.00%	661,547	383,964	383,964
Chih-Hung Investment Corporation			Initial Investment (Note 1)		Investment as of March 31, 2026			Net income (loss) of investee company	Investment income (loss) recognized
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount
Grain Media Inc.	Taiwan	IC designing, marketing and customer service	$1,456	$1,456	Common stock 146 thousand shares	19.42%	$1,136	$-	$-
Innopower Technology Corporation	Taiwan	Silicon Intellectual Property designing	80,000	80,000	Common stock 35,873 thousand shares	100.00%	139,221	(58,834)	(58,834)
FaradayTek Solutions India Private Limited	India	IC design services	45	45	Common stock 10 thousand shares	1.00%	207	2,868	29
Sheng Bang Investment Corporation			Initial Investment (Note 1)		Investment as of March 31, 2026			Net income (loss) of investee company	Investment income (loss) recognized
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount
Grain Media Inc.	Taiwan	IC designing, marketing and customer service	$6,044	$6,044	Common stock 604 thousand shares	80.58%	$4,713	$-	$-
FaradayTek Solutions India Private Limited	India	IC design services	4,462	4,462	Common stock 990 thousand shares	99.00%	20,474	2,868	2,839
Solid Silicon Technology Corporation	USA	Silicon Intellectual Property designing	568,630	568,630	Common stock 0.1 thousand shares	100.00%	630,157	(9,902)	(13,566)

ATTACHMENT 6 (Related information of investee companies)

Innopower Technology Corporation

				Initial Investment (Note 1)			Investment as of March 31, 2026
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount	Net income (loss) of investee company	Investment income (loss) recognized
Bright Capital Group Limited	Samoa	General investing	$68,593	$68,593	Common stock 2,301 thousand shares	100.00%	$150,265	$(42,536)	$(42,536)
Faraday Technology Corp. (B.V.I.)
				Initial Investment (Note 1)			Investment as of March 31, 2026
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount	Net income (loss) of investee company	Investment income (loss) recognized
Faraday Technology (Mauritius) Corp.	Mauritius	General investing	USD 12,859,205	USD 12,859,205	Common stock 12,804 thousand shares	100.00%	$241,309	$1,886	$1,886
GrainTech Electronics Limited	Hong Kong	IC designing, marketing and customer service	USD 100,000	USD 100,000	Common stock 100 thousand shares	100.00%	5,782	135	135
Faraday Technology (Samoa) Corp.	Samoa	General investing	USD 4,715,067	USD 4,715,067	Common stock 4,715 thousand shares	100.00%	309,126	(2,102)	(2,102)
Artery Technology Corporation	Cayman	General investing	USD 9,809,000	USD 9,809,000	Common stock 31,149 thousand shares	49.86%	736,878	68,268	37,358
Artery Technology Corporation
				Initial Investment (Note 1)			Investment as of March 31, 2026
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount	Net income (loss) of investee company	Investment income (loss) recognized
Artery Technology Company	Taiwan	IC designing, marketing and customer service	$281,101	$281,101	Common stock 28,114 thousand shares	49.86% (Note 2)	$23,691	$2,985	$(5,390)
Sinble Technology Pte. Ltd.
				Initial Investment (Note 1)			Investment as of March 31, 2026
Investee company	Location	Main businesses and products	March 31, 2026	December 31, 2025	Number of shares	Percentage of ownership (%)	Carrying amount	Net income (loss) of investee company	Investment income (loss) recognized
GSME Vietnam Company Limited	Vietnam	IC design services	USD 1,300,000	USD 1,300,000	-	100.00%	$13,075	$(15,508)	$(15,508)

Note 1: USD are expressed in dollars.
Note 2: The Company owns 100% of Faraday Technology Corp. (B.V.I.) and Faraday Technology Corp. (B.V.I.) owns 49.86% of Artery Technology Corporation. Artery Technology Corporation owns 100% of Artery Technology Company; therefore, the Group's shareholding of Artery Technology Company is 49.86%.

ATTACHMENT 7 (Investment in Mainland China)

Unit: New Taiwan Dollars in thousands, USD and RMB in dollars

Investee company	Main Businesses and Products	Total Amount of Paid-in Capital	Method of Investment	Investment Flows			Carrying Value as of March 31, 2026
				Accumulated Outflow of Investment from Taiwan as of January 1, 2026	Outflow	Inflow	Accumulated Outflow of Investment from Taiwan as of March 31, 2026	Net Income (Loss) of Investee Company	Percentage of Ownership	Investment Income (Loss) Recognized	193,074 (USD 6,033,563)	Accumulated Inward Remittance of Earnings as of March 31, 2026
Faraday Technology China Corporation	IC designing, marketing and customer service	$192,000 (USD 6,000,000)	Note 1, 3	$192,000 (USD 6,000,000)	$-	$-	$192,000 (USD 6,000,000)	$1,839	100.00%	$1,839 Note 8 (1)	$238,705	$-
Faraday Technology Corporation (Suzhou)	IC designing, marketing and customer service	185,600 (USD 5,800,000)	Note 4	-	-	-	-	(42,536)	100.00%	(42,536) Note 8 (2)	150,250	193,074 (USD 6,033,563)
United Business Service Corporation	IC designing, marketing and customer service	138,930 (RMB 30,000,000)	Note 1	138,930 (RMB 30,000,000)	-	-	138,930 (RMB 30,000,000)	(2,102)	100.00%	(2,102) Note 8 (1)	309,125	-
Artery Technology Co., Ltd.	IC designing, marketing and customer service	382,720 (USD 11,960,000)	Note 1, 5, 6	108,110 (USD 3,378,450)	-	-	108,110 (USD 3,378,450)	85,304	49.86%	48,135 Note 8 (1)	439,892	83,692 (USD 2,615,365)
United Creative Solution Corporation	IC designing, marketing and customer service	46,310 (RMB 10,000,000)	Note 7	-	-	-	-	3,690	100.00%	3,690 Note 8 (1)	189,157	-
Innopower Technology Corporation (Chongqing)	IC designing, marketing and customer service	4,631 (RMB 1,000,000)	Note 7	-	-	-	-	1	100.00%	1 Note 8 (1)	4,639	-

ATTACHMENT 7 (Investment in Mainland China)

Accumulated investment in Mainland China as of March 31, 2026	Investment amounts authorized by Investment Commission, MOEA	Upper limit on investment
$450,993 (Note 2)
(USD14,093,517)	$817,082 (Note 2)
(USD25,533,815)	$8,193,044

Note 1: Indirectly investment in Mainland China through subsidiaries of Faraday Technology Corp. (B.V.I.) (registered in a third region) such as Faraday Technology (Mauritius) Corp., Faraday Technology (Samoa) Corp., and Artery Technology Corporation.

Note 2: Amounts denominated in foreign currency is translated into New Taiwan Dollars by using exchange rate on March 31, 2026.

Note 3: As of March 31, 2026, Investment Commission, MOEA approved the total investment amount USD 6,000 thousand. The Company had remitted investment amounted USD 5,500 thousand, and Faraday Technology (Mauritius) Corp. had remitted investment amounted USD 500 thousand from its owned capital.

Note 4: On May 19, 2010, Investment Commission, MOEA approved Innopower Technology Corporation to acquire 100% of ownership of Faraday Technology Corporation (Suzhou) with USD 602,182. Before the transaction, Investment Commission, MOEA had approved the total investment amount USD 5,800 thousand. On May 24, 2023, the cash dividend of USD 6,034 thousand was repatriated to deduct the accumulative amount of investment in Mainland China. Therefore, the accumulative remittance of investment funds at the end of the period was nil.

Note 5: As of March 31, 2026, Investment Commission, MOEA approved the total investment amount USD 7,033 thousand, and the Company had remitted USD 3,378 thousand for the investment.

Note 6: The Company owns 100% of Faraday Technology Corp. (B.V.I.) and Faraday Technology Corp. (B.V.I.). owns 49.86% in Artery Technology Corporation. The Artery Technology Corporation owns 100% of Artery Technology Co., Ltd.; therefore, the Group's shareholding of Artery Technology Co., Ltd. is 49.86%.

Note 7: These companies were directly invested by United Business Service Corporation.

Note 8: The investment income (loss) recognized in current period, the investment income (loss) were determined based on the following basis:
1. The financial statements were reviewed the auditors of the parent company.
2. The financial presentations were reviewed by an international certified public accounting firm in cooperation with an R.O.C. accounting firm.
3. Others

85 -

AI assistant

Faraday — Interim / Quarterly Report 2026

52268_rns_2026-05-25_e1441380-bda8-4a9b-8d45-8a7bcb6d95da.pdf

Review Report of Independent Auditors

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

Notice to Readers

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

1. History and Organization

2. Date and Procedures of Authorization of Financial Statements for Issue

3. Newly Issued or Revised Standards and Interpretations

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Summary of Significant Accounting Policies

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

5. Significant Accounting Judgments, Estimates and Assumptions

6. Contents of Significant Accounts

(1) Cash and cash equivalents

(2) Financial assets and liabilities at fair value through profit or loss

(6) Inventories

(7) Other current assets

Defined benefit plan

(15) Equity

A. Capital stock

B. Additional paid-in capital

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

C. Retained earnings and dividend policies

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Expressed in Thousands of New Taiwan Dollars unless Otherwise Specified)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(2) Contract balances

The assessment of income tax returns

(24) Earnings per share

(25) Business combinations

Acquisition consideration

Contingent consideration

(26) Disposal group held for sale

7. Related Party Transactions

(1) Operating revenues

(2) Purchases

(3) Rental expenses

Right-of-use assets

Lease liabilities

(4) Research expenses

(5) Contract assets

(6) Accounts receivable – related parties, net

8. Assets Pledged as Collateral

9. Significant Contingencies and Unrecognized Contractual Commitments

10. Losses Due to Major Disasters

11. Significant Subsequent Events

12. Others

FARADAY TECHNOLOGY CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Interest rate risk

Equity price risk

(4) Credit risk management

(5) Liquidity risk management

Information on significant unobservable inputs to valuation

14. Segment information

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Faraday Interim / Quarterly Report 2026