ITE - Interim / Quarterly Report 2024

English Translation of a Report and Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS WITH REPORT OF INDEPENDENT AUDITORS FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2024 AND 2023

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.

Independent Auditors’ Review Report Translated from Chinese

To ITE Tech. Inc.

Introduction

We have reviewed the accompanying consolidated balance sheets of ITE Tech. Inc. and its subsidiaries (“the Group”) as of March 31, 2024 and 2023, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2024 and 2023, and notes to the consolidated financial statements, including the summary of material 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 No. 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$3,919 thousand and NT$9,082 thousand, constituting 0.05% and 0.12% of the consolidated total assets, and total liabilities of NT$1,439 thousand and NT$5,257 thousand, constituting 0.08% and 0.38% of the consolidated total liabilities as of March 31, 2024 and 2023, respectively; and total comprehensive income of NT$372 thousand and NT$1,305 thousand, constituting 0.10% and 0.22% of the consolidated total comprehensive income for the three-month periods ended March 31, 2024 and 2023, respectively. And as explained in Note 6(8), the financial statements of certain associates and joint ventures accounted for under the equity method were not reviewed by independent auditors. Those associates and joint ventures under equity method amounted to NT$10,050 thousand and NT$18,620 thousand as of March 31, 2024 and 2023, respectively. The related shares of profit or loss from the associates and joint ventures under the equity method amounted to NT$(1,754) thousand and NT$(2,949) thousand for the three-month periods ended March 31, 2024 and 2023, respectively. The information related to above subsidiaries and the associate accounted for under the equity method disclosed in Note 13 was also not reviewed by independent auditors.

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 associate accounted for using the equity method 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 ITE Tech. Inc. and its subsidiaries as of March 31, 2024 and 2023, and their consolidated financial performance and cash flows for the threemonth periods ended March 31, 2024 and 2023, in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard No. 34, “Interim Financial Reporting” as endorsed and became effective by Financial Supervisory Commission of the Republic of China.

Hu, Shen-Chieh

Hsu, Hsin-Min

Ernst & Young, Taiwan

May 7, 2024

Notice to Readers

The accompanying consolidated financial statements are intended only to present the consolidated 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.

Accordingly, the accompanying consolidated financial statements and report of independent auditors are not intended for use by those who are not informed about the accounting principles or Standards on Auditing of the Republic of China, and their applications in practice. As the consolidated financial statements are the responsibility of the management, Ernst & Young cannot accept any liability for the use of, or reliance on, the English translation or for any errors or

misunderstandings that may derive from the translation.

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

March 31, 2024, December 31, 2023 and March 31, 2023

(Expressed in Thousands of New Taiwan Dollars)

ASSETS	Notes			As of
		March 31, 2024		December 31,	2023	March 31, 2023
Current assets Cash and cash equivalents Financial assets at fair value through profit or loss-current Notes receivables, net Trade receivables, net Trade receivables from related parties, net Other receivables Inventories, net Prepayments Other current assets Total current assets Non-current assets Financial assets at fair value through profit or loss-noncurrent Financial assets at fair value through other comprehensive income-noncurrent Financial assets measured at amortized cost-noncurrent Investments accounted for using the equity method Property, plant and equipment Right-of-use assets Intangible assets Deferred tax assets Other non-current assets Total non-current assets Total assets	6(1) 6(2) 6(5),6(16) 6(6),6(16) 6(6),6(16),7 6(7) 6(2) 6(3) 6(4),8 6(8) 6(9) 6(17) 6(10) 4,6(21)	$3,825,369 402,131 7,971 856,506 - 13,655 709,025 74,374 30	44.91 4.72 0.09 10.06 - 0.16 8.33 0.87 -	$3,297,069 400,861 7,294 867,926 847 7,783 804,480 75,442 104	40.14 4.88 0.09 10.57 0.01 0.09 9.79 0.92 -	$2,156,236 725,830 8,369 789,376 - 1,735 951,410 66,364 51	29.25 9.85 0.11 10.71 - 0.02 12.91 0.90 -
		5,889,061	69.14	5,461,806	66.49	4,699,371	63.75
		172,319 1,311,397 4,230 10,050 651,416 77,933 275,143 86,637 38,801	2.02 15.40 0.05 0.12 7.65 0.91 3.23 1.02 0.46	168,908 1,459,037 4,230 11,804 662,142 79,888 277,680 86,835 1,901	2.06 17.76 0.05 0.14 8.06 0.97 3.38 1.06 0.03	137,123 1,389,964 4,230 18,620 622,426 85,688 283,872 89,681 40,260	1.86 18.86 0.06 0.25 8.44 1.16 3.85 1.22 0.55
		2,627,926	30.86	2,752,425	33.51	2,671,864	36.25
		$8,516,987	100.00	$8,214,231	100.00	$7,371,235	100.00

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

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

March 31, 2024, December 31, 2023 and March 31, 2023

(Expressed in Thousands of New Taiwan Dollars)

LIABILITIES AND EQUITY	Notes			As of
		March 31,2024		December 31,	2023	March 31,2023
Current liabilities Contract liabilities-current Trade payables Trade payables to related parties Other payables Other payables to related parties Current tax liabilities Lease liabilities-current Other current liabilities Total current liabilities Non-current liabilities Deferred tax liabilities Lease liabilities-noncurrent Net defined benefit liabilities-noncurrent Deposits received Total non-current liabilities Total liabilities Equity attributable to owners of the parent Share capital Common stock Capital surplus Retained earnings Legal reserve Undistributed earnings Other equity Total equity Total liabilities and equity	6(15) 7 7 4,6(21) 6(17) 6(11) 4,6(21) 6(17) 4,6(12) 6(13) 6(13) 6(13)	$14,338 306,162 184,537 529,619 2,973 329,856 5,143 173,850	0.17 3.59 2.17 6.22 0.04 3.87 0.06 2.04	$8,034 384,385 177,102 546,212 10,565 286,613 6,152 185,227	0.10 4.68 2.16 6.65 0.13 3.49 0.07 2.25	$8,631 270,027 124,373 478,632 12,737 157,053 7,587 137,719	0.12 3.66 1.69 6.49 0.17 2.13 0.10 1.87
		1,546,478	18.16	1,604,290	19.53	1,196,759	16.23
		938 76,087 71,787 28,290	0.01 0.90 0.84 0.33	- 77,011 78,347 28,290	- 0.94 0.95 0.35	78 81,173 82,727 28,290	- 1.10 1.12 0.39
		177,102	2.08	183,648	2.24	192,268	2.61
		1,723,580	20.24	1,787,938	21.77	1,389,027	18.84
		1,610,801 1,229,824 710,912 2,865,150 376,720	18.91 14.44 8.35 33.64 4.42	1,610,801 1,229,824 710,912 2,375,480 499,276	19.61 14.97 8.65 28.92 6.08	1,610,801 1,310,364 588,175 2,085,680 387,188	21.85 17.78 7.98 28.30 5.25
		6,793,407	79.76	6,426,293	78.23	5,982,208	81.16
		$8,516,987	100.00	$8,214,231	100.00	$7,371,235	100.00

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

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three-month periods ended March 31, 2024 and 2023

(Expressed in Thousands of New Taiwan Dollars, Except for Earnings per Share)

Description	Notes	For the three-month periods ended March 31,	For the three-month periods ended March 31,	For the three-month periods ended March 31,	For the three-month periods ended March 31,
		2024		2023
Operating revenues Operating costs Gross profit Operating expenses Selling expenses Administrative expenses Research and development expenses Total operating expenses Operating income Non-operating income and expenses Interest income Other income Other gains and losses Finance costs Share of loss of associates and joint ventures accounted for using the equity method Total non-operating income and expenses Net income before income tax Income tax expense Net income Other comprehensive income (loss) Items that may not be reclassified subsequently to profit or loss Unrealized gains (losses) from equity instrument investments measured at fair value through other comprehensive income Income tax relating to those items not to be reclassified to profit or loss Items that may be reclassified subsequently to profit or loss Exchange differences resulting from translating the financial statements of foreign operations Other comprehensive income (loss), net of tax Total comprehensive income Net income for the periods attributable to: Owners of the parent Total comprehensive income for the periods attributable to: Owners of the parent Earning per share(in New Taiwan Dollars) Basic earnings per share (in New Taiwan Dollars) Diluted earnings per share (in New Taiwan Dollars)	6(15) 6(7),6(17),6(18),7 6(17),6(18),7 6(19) 6(19) 6(19) 6(19) 6(8) 4,6(21) 6(20) 6(22)	$1,512,350 (700,430)	100.00 (46.31)	$1,321,069 (584,642)	100.00 (44.26) 55.74 (6.13) (4.41) (15.91) (26.45) 29.29 0.30 0.08 (0.15) (0.03) (0.22) (0.02) 29.27 (3.39) 25.88 18.83 (0.09) - 18.74 44.62
		811,920	53.69	736,427
		(90,458) (68,005) (240,523)	(5.98) (4.50) (15.90)	(81,008) (58,296) (210,094)
		(398,986)	(26.38)	(349,398)
		412,934	27.31	387,029
		11,029 676 18,365 (359) (1,754)	0.73 0.04 1.21 (0.02) (0.12)	3,930 1,129 (1,951) (418) (2,949)
		27,957	1.84	(259)
		440,891 (46,039)	29.15 (3.04)	386,770 (44,825)
		394,852	26.11	341,945
		(28,651) 872 41	(1.89) 0.06 -	248,754 (1,224) 22
		(27,738)	(1.83)	247,552
		$367,114	24.28	$589,497
		$394,852		$341,945
		$367,114		$589,497
		$2.45		$2.12
		$2.44		$2.10

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

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the three-month periods ended March 31, 2024 and 2023

(Expressed in Thousands of New Taiwan Dollars)

Description			Equity attributable t	Equity attributable t	o owners of the parent			Total equity
	Share capital	Capital surplus	Retained	earnings	Other	equity	O Equity attributable to owners of the parent
			Legal reserve	Undistributed earnings	Exchange differences resulting from translating the financial statements of foreign operations	Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income
Balance as of January 1, 2023 Changes in other capital surplus Changes in associates and joint ventures accounted for using the equity method Profit for the three-month period ended March 31, 2023 Other comprehensive income for the three-month period ended March 31, 2023 Total comprehensive income for the three-month period ended March 31, 2023 Disposal of equity instruments measured at fair value through other comprehensive income Balance as of March 31, 2023 Balance as of January 1, 2024 Profit for the three-month period ended March 31, 2024 Other comprehensive income (loss) for the three-month period ended March 31, 2024 Total comprehensive income (loss) for the three-month period ended March 31, 2024 Disposal of equity instruments measured at fair value through other comprehensive income Balance as of March 31, 2024	$1,610,801 - - - - - $1,610,801 $1,610,801 - - - - $1,610,801	$1,297,073 13,291 - -	$588,175 - - -	$1,731,439 - 341,945 -	$(206) - - 22	$152,138 - - 247,530	$5,379,420 13,291 341,945 247,552	$5,379,420 13,291 341,945 247,552 589,497 - $5,982,208 $6,426,293 394,852 (27,738) 367,114 - $6,793,407
		- -	- -	341,945 12,296	22 -	247,530 (12,296)	589,497 -
		$1,310,364	$588,175	$2,085,680	$(184)	$387,372	$5,982,208
		$1,229,824 - -	$710,912 - -	$2,375,480 394,852 -	$(247) - 41	$499,523 - (27,779)	$6,426,293 394,852 (27,738)
		- -	- -	394,852 94,818	41 -	(27,779) (94,818)	367,114 -
		$1,229,824	$710,912	$2,865,150	$(206)	$376,926	$6,793,407

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

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three-month periods ended March 31, 2024 and 2023 (Expressed in Thousands of New Taiwan Dollars)

Description	For the three-month periods ended March 31,	For the three-month periods ended March 31,	Description	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023		2024	2023
Cash flows from operating activities: Profit before tax Adjustments for: The profit or loss items which did not affect cash flows: Depreciation Amortization Gains on financial assets at fair value through profit or loss Interest expenses Interest income Share of loss of associates and joint ventures accounted for using the equity method Changes in operating assets and liabilities: Financial assets mandatorily measured at fair value through profit or loss Notes receivables Trade receivables Trade receivables from related parties Other receivables Inventories Prepayments Other current assets Contract liabilities Trade payables Trade payables to related parties Other payables Other payables to related parties Other current liabilities Net defined benefit liabilities Cash generated from operating activities Interest received Interest paid Income tax paid Net cash provided by operating activities	$440,891 15,660 3,125 (5,335) 359 (11,029) 1,754 - (677) 11,420 847 - 95,455 1,068 74 6,304 (78,223) 7,435 (16,593) (7,592) (11,377) (6,560)	$386,770 11,552 2,628 (435) 418 (3,930) 2,949 (60,000) 296 (71,792) - 24 119,801 7,898 78 (3,256) 12,649 14,523 6,481 6,172 17,886 (808)	Cash flows from investing activities: Proceeds from disposal of financial assets at fair value through other comprehensive income Acquisition of financial assets at fair value through profit or loss Increase in prepayment for investments Acquisition of property, plant and equipment Acquisition of intangible assets Decrease in other non-current assets Net cash provided by (used in) investing activities Cash flows from financing activities: Cash payment for the principal portion of the lease liabilities Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of period Cash and cash equivalents at the end of period	113,021 - (37,500) (2,934) (579) 600	13,702 (50,013) (37,500) (2,656) (3,942) 66
				72,608	(80,343)
				(1,933)	(1,785)
				(1,933)	(1,785)
				(13)	(25)
	447,006	449,904
	11,779 (359) (788)	3,562 (418) (147)
				528,300 3,297,069	370,748 1,785,488
	457,638	452,901		$3,825,369	$2,156,236

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

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the Three-Month Periods Ended March 31, 2024 and 2023

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

1. Organization and Operation

ITE Tech. Inc. (“the Company”) was incorporated in Hsinchu Science Park on May 29, 1996. The Company’s main products are Super I/O control (SIO) ICs for desktop computers, embedded control (EC) ICs for notebook computers, high-speed audio-video interface related ICs, system on a chip (SoC), and other customized application chips. The Company’s shares are traded in Taiwan Stock Exchange. The Company’s registered office and the main business location is at 3F, No.13, Innovation Road I, Hsinchu Science Park, Hsinchu City.

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

The consolidated financial statements of the Company and its subsidiaries (“the Group”) were authorized for issue by the Board of Directors on May 7, 2024.

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 endorsed by Financial Supervisory Commission (“FSC”) and become effective for annual periods beginning on or after January 1, 2024. The application of these new standards and amendments had no material effect on the Group.

(2) Standards or interpretations issued, revised, or amended, by International Accounting Standards Board (“IASB”) which are not endorsed by FSC , and not yet adopted by the Group as at the end of the reporting period are listed below.

Items	New, Revised or Amended Standards and Interpretations	Effective Date issued byIASB
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 orJoint Ventures	To be determined by IASB
b	IFRS 17 “Insurance Contracts”	January1, 2023
c	Lack of Exchangeability– Amendments to IAS 21	January1, 2025
d	IFRS 18 “Presentation and Disclosure in Financial Statements”	January 1, 2027

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

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. The aforementioned standards and interpretations have no material impact on the Group.

4. Summary of Material Accounting Policies

(1) Statement of compliance

The consolidated financial statements of the Group for the three-month periods ended March 31, 2024 and 2023 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 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.

(3) Basis of consolidation

Preparation principle of consolidated financial statements

Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Company controls an investee if and only if the Company has:

(a) power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the investee)
(b) exposure, or rights, to variable returns from its involvement with the investee, and
(c) the ability to use its power over the investee to affect its returns

When the Company has less than a majority of the voting or similar rights of an investee, the Company considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

(a) the contractual arrangement with the other vote holders of the investee
(b) rights arising from other contractual arrangements
(c) the Company’s voting rights and potential voting rights
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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

The Company re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.

Subsidiaries are fully consolidated from the acquisition date, being the date on which the Company obtains control, and continue to be consolidated until the date that such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using uniform accounting policies. All intra-group balances, income and expenses, unrealized gains and losses and dividends resulting from intra-group transactions are eliminated in full.

A change in the ownership interest of a subsidiary, without a change of control, is accounted for as an equity transaction.

Total comprehensive income of the subsidiaries is attributed to the owners of the parent and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

If the Company loses control of a subsidiary, it:

(a) derecognizes the assets (including goodwill) and liabilities of the subsidiary;
(b) derecognizes the carrying amount of any non-controlling interest;
(c) recognizes the fair value of the consideration received;
(d) recognizes the fair value of any investment retained;
(e) reclassifies the parent’s share of components previously recognized in other comprehensive income to profit or loss, or transfers directly to retained earnings if required by other IFRSs ; and
(f) recognizes any resulting difference in profit or loss.

The consolidated entity is listed as follows:

Investor	Subsidiary	Main businesses		Percentage ofownership	Percentage ofownership	Percentage ofownership
				March 31, 2024	December 31, 2023	March 31, 2023
ITE Tech. Inc.	ITE Tech. (Shenzhen) Inc.	Technological consultation services for ICs products		100.00%	100.00%	100.00%

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

The financial statements of the consolidated subsidiary listed above had not been reviewed by independent auditors. As of March 31, 2024 and 2023, the related asset of the subsidiary is NT$3,919 thousand and NT$9,082 thousand, respectively, and the related liability is NT$1,439 thousand and NT$5,257 thousand, respectively. The comprehensive income of the subsidiary is NT$372 thousand and NT$1,305 thousand for the three-month periods ended March 31, 2024 and 2023, respectively.

(4) Except for the accounting policies listed in Note 4(5) to 4(6), the same accounting policies have been followed in the consolidated financial statements for the three-month period ended March 31, 2024 as were applied in the preparation of the Group’s consolidated financial statements for the year ended December 31, 2023. For the summary of other material accounting policies, please refer to the consolidated financial statements for the year ended December 31, 2023.

(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.

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, 2024 and 2023 as were applied in the preparation of the Group’s consolidated financial statements for the year ended December 31, 2023. Please refer to the consolidated financial statements for the year ended December 31, 2023.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

6. Contents of Significant Accounts

(1) Cash and cash equivalents

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$328 302,998 3,522,043	$316 215,760 3,080,993	$304 258,732 1,897,200
$3,825,369	$3,297,069	$2,156,236

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

	As of
March 31, 2024	December 31, 2023 $435,830 133,939 $569,769 $400,861 168,908 $569,769	March 31, 2023
$439,400 135,050		$752,412 110,541
$574,450		$862,953
$402,131 172,319		$725,830 137,123
$574,450		$862,953

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

(3) Financial assets at fair value through other comprehensive income, non-current

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$216,352 1,095,045	$333,627 1,125,410	$319,776 1,070,188
$1,311,397	$1,459,037	$1,389,964

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Financial assets at fair value through other comprehensive income were not pledged.

In consideration of the Group’s investment strategy, the Group disposed and derecognized certain equity instrument investments measured at fair value through other comprehensive income. Details on derecognition of such investments are as follows:

The fair value of the investments at the date of derecognition The cumulative gain on disposal reclassified from other equity to retained earnings	For the three-month periods endedMarch31,	For the three-month periods endedMarch31,
	2024	2023 $13,702 12,296
	$118,989 94,818

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

Time deposits		As of
	March 31, 2024	December 31, 2023	March 31, 2023
	$4,230	$4,230	$4,230

The Group classified certain financial assets as financial assets measured at amortized cost. Since credit risk is low, expected credit losses during the duration are not significant. Please refer to Note 8 for more details on financial assets measured at amortized cost under pledge and Note 12 for more details on credit risk.

(5) Notes receivables

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$7,971 -	$7,294 -	$8,369 -
$7,971	$7,294	$8,369

Notes receivables were not pledged.

The Group follows the requirement of IFRS 9 to assess the impairment. Please refer to Note 6(16) for more details on loss allowance and Note 12 for details on credit risk.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(6) Trade receivables and trade receivables from related parties

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$856,506 -	$867,926 -	$789,376 -
856,506	867,926	$789,376
- -	847 -	- -
-	847	-
$856,506	$868,773	$789,376

Trade receivables and trade receivables from related parties were not pledged.

Trade receivables are generally on 30-90 day terms. The total carrying amounts were NT$856,506 thousand, NT$868,773 thousand and NT$789,376 thousand as of March 31, 2024, December 31, 2023 and March 31, 2023, respectively. Please refer to Note 6(16) for more details on impairment of trade receivables and Note 12 for more details on credit risk.

(7) Inventories

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$4,023 352,667 352,335	$2,467 395,164 406,849	$2,039 589,880 359,491
$709,025	$804,480	$951,410

The cost of inventories recognized in expenses amounted to NT$700,430 thousand and NT$584,642 thousand for the three-month periods ended March 31, 2024 and 2023, respectively, including the inventory valuation loss of NT$17,962 thousand and the inventory valuation gain (reversal of decline in market value, obsolete and slow-moving inventories) of NT$20,311 thousand for the three-month periods ended March 31, 2024 and 2023, respectively.

Inventories were not pledged.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(8) Investments accounted for using the equity method

The detail of investments accounted for using the equity method is as follows:

Investee			As of	As of
	March 31,2024		December 31,2023		March	31,2023
	Carrying amount	Percentage of ownership	Carrying amount	Percentage of ownership	Carrying amount	Percentage of ownership
Investments in an associate: Emright Technology Co., Ltd.	$10,050	30.15%	$11,804	30.15%
					$18,620	30.15%

Emright Technology Co., Ltd. increased capital in March 2023, and the Company did not subscribe the new share proportionate to its original ownership interest. Its ownership was therefore reduced to 30.15%.

Although the Group is the largest shareholder of the aforementioned associate; after comprehensive assessment, the Group does not own the major voting rights as the remaining voting rights holders are able to align and prevent the Group from ruling the relevant operation. Therefore, the Group does not control but owns significant influence over the aforementioned associate.

The aggregate amount of the Group’s share of the aforementioned immaterial associate that is accounted for using the equity method is as follows:

Loss from continuing operations Other comprehensive income (net of tax) Total comprehensive loss	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$(1,754) -	$(2,949) -
	$(1,754)	$(2,949)

The Group did not have contingent liabilities or capital commitments to the aforementioned associate and the investment was not pledged as of March 31, 2024, December 31, 2023 and March 31, 2023.

The carrying amount of the associate under equity method amounted to NT$10,050 thousand and NT$18,620 thousand as of March 31, 2024 and 2023, respectively. The related shares of profit or loss from the associate under the equity method amounted to NT$(1,754) thousand and NT$(2,949) thousand for the three-month periods ended March 31, 2024 and 2023, respectively. The information related to above associate accounted for under the equity method was not reviewed by independent auditors.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(9) Property, plant and equipment

Land	Buildings	Machinery and equipment	Research and development equipment	Office equipment	Other equipment	Total
$311,450 - -	$387,143 555 -	$41,084 - -	$99,713 1,729 -	$7,763 21 111	$28,451 629 -	$875,604 2,934 111
$311,450	$387,698	$41,084	$101,442	$7,895	$29,080	$878,649
$311,450 - -	$377,001 - -	$41,084 - -	$49,072 2,313 -	$5,813 - 41	$24,499 343 -	$808,919 2,656 41
$311,450	$377,001	$41,084	$51,385	$5,854	$24,842	$811,616
	$141,598 3,963 -	$17,484 1,712 -	$33,253 6,226 -	$5,423 173 101	$15,704 1,596 -	$213,462 13,670 101
$-	$145,561	$19,196	$39,479	$5,697	$17,300	$227,233
$- - -	$129,252 3,154 -	$10,636 1,712 -	$22,369 3,162 -	$5,199 71 36	$12,096 1,503 -	$179,552 9,602 36
$-	$132,406	$12,348	$25,531	$5,306	$13,599	$189,190
$311,450	$242,137	$21,888	$61,963	$2,198	$11,780	$651,416
$311,450	$245,545	$23,600	$66,460	$2,340	$12,747	$662,142
$311,450	$244,595	$28,736	$25,854	$548	$11,243	$622,426

(a) Components of buildings with different useful lives are main building structure and air conditioning units, which are depreciated over 41 years and 3 years, respectively.

(b) Property, plant and equipment were not pledged.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(10) Intangible assets

Software	Goodwill	Others	Total
$12,558 579 55	$2,674,827 - -	$81,191 - -	$2,768,576 579 55
$13,192	$2,674,827	$81,191	$2,769,210
$12,430 3,942 21	$2,674,827 - -	$79,351 - -	$2,766,608 3,942 21
$16,393	$2,674,827	$79,351	$2,770,571
$6,302 868 46	$2,468,504 - -	$16,090 2,257 -	$2,490,896 3,125 46
$7,216	$2,468,504	$18,347	$2,494,067
$7,943 968 16	$2,468,504 - -	$7,608 1,660 -	$2,484,055 2,628 16
$8,927	$2,468,504	$9,268	$2,486,699
$5,976	$206,323	$62,844	$275,143
$6,256	$206,323	$65,101	$277,680
$7,466	$206,323	$70,083	$283,872

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Amortization expenses of intangible assets under the statement of comprehensive income are as follows:

Selling expenses Administrative expenses Research and development expenses	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$59	$117
	$38	$53
	$3,028	$2,458

(11) Other current liabilities

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$163,979 9,871	$173,638 11,589	$129,196 8,523
$173,850	$185,227	$137,719

(12) Post-employment benefits plans

Defined contribution plan

For the three-month periods ended March 31, 2024 and 2023, the pension expenses recognized under the defined contribution plan are NT$8,217 thousand and NT$7,924 thousand, respectively.

Defined benefit plan

For the three-month periods ended March 31, 2024 and 2023, the pension expenses recognized under the defined benefit plan are NT$726 thousand and NT$730 thousand, respectively.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(13) Equity

(a) Common stock

The Company’s authorized capital as of March 31, 2024, December 31, 2023 and March 31, 2023 was NT$2,500,000 thousand divided into 250,000,000 shares (including 30,000,000 shares reserved for exercise of employee stock options at each period), each at a par value of NT$10. The Company’s issued capital was NT$1,610,801 thousand divided into 161,080,124 shares as of March 31, 2024, December 31, 2023 and March 31, 2023. Each share has one voting right and a right to receive dividends.

(b) Capital surplus

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$737,417 191,764 112,008 19,238 16,424 1,977 14,299 136,697	$737,417 191,764 112,008 19,238 16,424 1,977 14,299 136,697	$817,957 191,764 112,008 19,238 16,424 1,977 14,299 136,697
$1,229,824	$1,229,824	$1,310,364

According to the Company Act, the capital surplus shall not be used except for offset a deficit of the company. When a company incurs no loss, it may distribute the capital surplus derived from the issuance of new shares at a premium 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.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

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

I. Income tax obligation;
II. Offsetting accumulated deficits, if any;
III. Legal reserve at 10% of net income after tax;
IV. Allocation or reverse of special reserves as required by law;
V. After deducting the respective amount specified from item I to IV, at least 50% of the remaining earnings will be distributed, together with the undistributed earnings at the beginning of the period, and the capital surplus. However, if the total distribution divided by all the issued shares is less than NT$0.1 per share, all the remaining and surplus shall not be distributed.

According to Article 240, Paragraph 5, and Article 241, Paragraph 2 of the Company Act, the Company authorizes the distributable dividends, legal reserve, and capital surplus in whole or in part may be paid in cash after a resolution has been adopted by a majority vote at a meeting of the Board of Directors attended by two-thirds of the total number of directors, and in addition thereto a report of such distribution shall be submitted to the shareholders’ meeting.

The distribution of dividends to shareholders of the company can be paid in cash or shares. 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. And the dividends in cash shouldn’t less than 30% of the distributable earnings, 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.

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 incurs no loss, 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.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

On March 31, 2021, FSC issued Order No. Financial-Supervisory-Securities-Corporate1090150022, which sets out the following provisions for compliance: On a public company’s first-time adoption of the IFRS, for any unrealized revaluation gains and cumulative translation adjustments (gains) recorded to shareholders’ equity that the company elects to transfer to retained earnings by application of the exemption under IFRS 1, the company shall set aside special reserve. For any subsequent use, disposal or reclassification of related assets, the Company can reverse the special reserve by the proportion of the special reserve first appropriated and distribute it.

The amount of special reserve provided by the Company for the first time in adopting IFRS is nil.

The appropriations of earnings for 2023 and 2022 were resolved by the Board of Directors’ meeting on February 23, 2024 and February 23, 2023, respectively. The details of distribution are as follows:

Appropriationofearnings Dividend per YearsEndedDecember31,	Appropriationofearnings Dividend per YearsEndedDecember31,	Dividend per	share (NT$)

2023	2022 $122,737 885,941	2023	2022
$165,272 1,208,101		$7.5	$5.5

Note: The amount of legal reserve in 2022 was approved by the shareholders at the regular shareholders' meeting held on June 16, 2023. The amount of legal reserve in 2023 is subject to the approval of the shareholders at the regular shareholders' meeting to be held on May 28, 2024, and will become effective.

In addition, the Board of Directors’ meeting on February 23, 2024 and February 23, 2023 resolved to distribute the capital surplus by cash in the amount of NT$80,540 thousand, each share at NT$0.5.

Please refer to Note 6(18) for more details on employees’ compensations and the remunerations to directors.

(14) Share-based payment plans

Certain employees of the Group are entitled to share-based payment as part of their remunerations; services are provided by the employees in return for the equity instruments granted. These plans are accounted for as equity-settled share-based payment transactions.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Restricted shares plans for employees

On June 16, 2023, a compensation plan was approved by the shareholders’ meeting to issue 5,000,000 restricted shares to qualified employees and the plan was approved by the competent authority on October 12, 2023. There were no shares issued as of March 31, 2024.

(15) Operating revenues

Revenue from contracts with customers Sale of goods Other operating revenues Total	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$1,511,027 1,323	$1,313,829 7,240
	$1,512,350	$1,321,069

Revenue recognition point of the Group is at a point in time. Analysis of revenue from contracts with customers for the three-month periods ended March 31, 2024 and 2023 is as follows:

(a) Contract balances

Contract liabilities – current

Sale of goods		As of	As of
	March 31, 2024	December 31, 2023	March 31, 2023	January 1, 2023
	$14,338	$8,034	$8,631	$11,887

The significant changes in the Group’s balances of contract liabilities for the three-month periods ended March 31, 2024 and 2023 are as follows:

The opening balance transferred to revenue Increase in receipts in advance during the period (deducting the amount incurred and transferred to revenue during the period) Total	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$(8,031) 14,335	$(11,885) 8,629
	$6,304	$(3,256)

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(b) Transaction price allocated to unsatisfied performance obligations

As of March 31, 2024 and 2023, it was not required to disclose relevant information of the unsatisfied performance obligations as the contract terms with customers about the sales of goods are all shorter than one year.

None.

(16) Expected credit losses (gains)

Operating expenses`－`expected credit losses (gains) Notes receivables Trade receivables Total	For the three-month periods endedMarch31,	For the three-month periods endedMarch31,
	2024	2023
	$- -	$- -
	$-	$-

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

The Group measures the loss allowance of its trade receivables (including notes receivables, trade receivables and trade receivables from related parties) at an amount equal to lifetime expected credit losses. The assessments of the Group’s loss allowance as of March 31, 2024, December 31, 2023 and March 31, 2023 are as follows:

The trade receivables loss allowance is measured by using a provision matrix, details are as follows:

2024.03.31

Not past due (Note)	Within 30 days	Past due		Total
		31-120 days	After 121 days
$844,790 -	$18,987 -	$700 -	$- 1%-100%	$864,477 -
-	-	-	-
$844,790	$18,987	$700	$-	$864,477

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

2023.12.31

Not past due (Note)	Within 30 days	Past due		Total
		31-120 days	After 121 days
$870,974 -	$5,093 -	$- -	$- 1%-100%	$876,067 -
-	-	-	-
$870,974	$5,093	$-	$-	$876,067
Not past due (Note)	Within30 days	Past due		Total
		31-120 days	After 121days
$797,527 -	$218 -	$- -	$- 1%-100%	$797,745 -
-	-	-	-
$797,527	$218	$-	$-	$797,745

Note: All of the Group’s notes receivables are not yet due.

(17) Leases

Group as a lessee

The Group leases various properties, including real estate such as land and buildings, and furniture and fixtures. The lease terms range from 3 to 33 years.

The Group’s leases effect on the financial position, financial performance and cash flows are as follows:

(a) Amounts recognized in the balance sheet
I. Right-of-use assets

The carrying amount of right-of-use assets

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$73,942 3,543 448	$74,779 4,596 513	$77,291 7,689 708
$77,933	$79,888	$85,688

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

During the three-month periods ended March 31, 2024 and 2023, the additions to rightof-use assets of the Group amounted to NT$0 and NT$3,052 thousand, respectively.

II. Lease liabilities

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$5,143 76,087	$6,152 77,011	$7,587 81,173
$81,230	$83,163	$88,760

Please refer to Note 6(19)(d) for the interest on lease liabilities recognized during the three-month periods ended March 31, 2024 and 2023, and refer to Note 12(5) Liquidity Risk Management for the maturity analysis for lease liabilities.

(b) Amounts recognized in the statement of comprehensive income

Depreciation charge for right-of-use assets

Land Buildings Furniture and fixtures Total	For the three-month periods endedMarch31,	For the three-month periods endedMarch31,
	2024	2023
	$837 1,088 65	$837 1,048 65
	$1,990	$1,950

The expenses relating to short-term leases The expenses relating to leases of low-value assets (Not including the short-term leases) The expenses relating to variable lease payments not included in the measurement of lease liabilities Total Income from subleasing right-of-use assets	For the three-month periods endedMarch31,	For the three-month periods endedMarch31,
	2024	2023
	$444 40 346	$427 - 302
	$830	$729
	$158	$158

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(d) Cash outflow relating to leasing activities

During the three-month periods ended March 31, 2024 and 2023, the Group’s total cash outflows for leases amounted to NT$2,979 thousand and NT$2,951 thousand, respectively.

(e) Extension options

Some of the Group’s property rental agreements 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 both periods covered by an option to extend the lease if the Group is reasonably certain to exercise that option. The option is used to maximize operational flexibility in terms of managing contracts. The majority of extension option held is 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.

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

function:
Employee benefits expense Salaries Labor and health insurance Pension Other employee benefits Total Depreciation Amortization		Forthe three-monthperiods endedMarch31,
		2024			2023
	Operating costs	Operating expenses	Total	Operating costs	Operating expenses	Total
	$11,393 855 511 301	$277,010 14,019 8,432 4,142	$288,403 14,874 8,943 4,443	$10,693 810 492 193	$248,502 12,854 8,162 2,609	$259,195 13,664 8,654 2,802
	$13,060	$303,603	$316,663	$12,188	$272,127	$284,315
	$2,031	$13,629	$15,660	$2,008	$9,544	$11,552
	$-	$3,125	$3,125	$-	$2,628	$2,628

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

According to the Articles of Incorporation, between 8% to 20% of profit of the current year is distributable as employees’ compensation and no higher than 1% of profit of the current year is distributable as remuneration to directors. However, the Company’s accumulated losses shall have been covered (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 Taiwan Stock Exchange (TWSE).

Based on a specific rate of profit of current year, the Company estimated the amounts of the employees’ compensation and remuneration to directors for the three-month period ended March 31, 2024 to be NT$49,538 thousand and NT$4,954 thousand, respectively. The amounts of the employees’ compensation and remuneration to directors for the three-month period ended March 31, 2023 were NT$43,457 thousand and NT$4,346 thousand, respectively. The employees’ compensation and remuneration to directors recognized as salary expense. If the board of directors resolved to distribute employees’ compensation in the form of shares, then the number of shares distributed as employees’ compensation was calculated based on the closing price one day earlier than the date of resolution. If the estimated amounts differ from the actual distribution resolved by the board of directors, the Company will recognize the change as an adjustment to income of next year.

The distributions of the employees’ compensation and remuneration to directors in cash for 2023 and 2022 were approved through the Board of Directors’ meeting on February 23, 2024 and February 23, 2023, respectively. There were no differences between the aforementioned approved amounts and the actual distribution of the employees’ compensation and remuneration to directors.

Information relevant to the aforementioned employees’ compensation and remuneration to directors can be obtained from the “Market Observation Post System” on the website of the TWSE.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(19) Non-operating income and expenses
(a) Interest income

Interest income (b) Other income Rental income Others Total	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$11,029	$3,930
	2024	2023
	$158 518	$158 971
	$676	$1,129

Foreign exchange gains (losses) , net Gains on financial assets at fair value through profit or loss (Note) Others Total	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$13,030 5,335 -	$(2,381) 435 (5)
	$18,365	$(1,951)

Note: Balances were arising from financial assets mandatorily measured at fair value through profit or loss, including valuation adjustment, dividend income and exchange difference, etc.

(d) Finance costs

Interest expenses on lease liabilities	For the three-month periods ended March31,	For the three-month periods ended March31,
	2024	2023
	$359	$418

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(20) Components of other comprehensive income (loss)

For the three-month period ended March 31, 2024

Arising during the period	Other comprehensive income(loss), before tax	Income tax relating to components of other comprehensive income	Other comprehensive income(loss), net oftax
$(28,651) 41	$(28,651) 41	$872 -	$(27,779) 41
$(28,610)	$(28,610)	$872	$(27,738)
		Income tax relating to components of other comprehensive income	Other comprehensive income(loss), net oftax
$248,754 22	$248,754 22	$(1,224) -	$247,530 22
$248,776	$248,776	$(1,224)	$247,552

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(21) Income tax

(a) The major components of income tax expense are as follows:

Income tax expense (income) recognized in profit or loss

Current income tax expense (income): Current income tax charge Adjustments in respect of current income tax of prior periods Deferred tax expense: Deferred tax expense relating to origination and reversal of temporary differences Total income tax expense	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$85,587 (41,556) 2,008	$77,036 (32,875) 664
	$46,039	$44,825

Income tax relating to components of other comprehensive income

Deferred tax expense (income): Unrealized gains or losses from equity instrument investments measured at fair value through other comprehensive income	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024 $(872)	2023
		$1,224

(b) The assessment of income tax returns

As of March 31, 2024, the assessment of the income tax returns of the Company and its subsidiaries is as follows:

ITE Tech. Inc. Subsidiary - ITE Tech. (Shenzhen) Inc.	The assessment of income tax returns
	Assessed and approved up to 2022 Assessed to 2022

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(22) Earnings per share

Basic earnings per share 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 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 on conversion of all the dilutive potential ordinary shares into ordinary shares.

(a) Basic earnings per share Profit attributable to ordinary equity holders of the parent company (in thousand NT$) Weighted average number of ordinary shares outstanding for basic earnings per share (share) Basic earnings per share (NT$) (b) Diluted earnings per share Profit attributable to ordinary equity holders of the parent company after dilution (in thousand NT$) Weighted average number of ordinary shares outstanding for basic earnings per share (share) Effect of dilution: Employees’ compensation-stock (share) Weighted average number of ordinary shares outstanding after dilution (share) Diluted earnings per share (NT$)	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$394,852	$341,945
	161,080,124	161,080,124
	$2.45	$2.12
	$394,852	$341,945
	161,080,124 1,038,091	161,080,124 1,599,504
	162,118,215	162,679,628
	$2.44	$2.10

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the issuance date of the financial statements.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

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

Names of related parties	Nature of relationship oftherelated parties
United Microelectronics Corp. HeJian Technology (Suzhou) Co., Ltd. Emright Technology Co., Ltd.	Director of the Group Other related party Associate

Significant transactions with the related parties

(1) Purchases

United Microelectronics Corp. HeJian Technology (Suzhou) Co., Ltd. Total	For the three-month periods ended March 31,	For the three-month periods ended March 31,
	2024	2023
	$195,894 78,788	$78,649 93,641
	$274,682	$172,290

The purchase prices to the above related parties were not comparable to the market due to differentiation of manufacturing process and product specification. Payment terms to related parties were 45 days after month-end.

(2) Trade receivables from related parties

Associate		As of
	March 31, 2024	December 31, 2023	March 31, 2023
	$-	$847	$-

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(3) Trade payables to related parties

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$127,270 57,267	$122,916 54,186	$56,771 67,602
$184,537	$177,102	$124,373

(4) Other payables to related parties

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$2,730 243	$10,565 -	$12,737 -
$2,973	$10,565	$12,737

(5) The Group purchased masks and other from the director of the Group and recognized NT$14,211 thousand and NT$12,804 thousand as manufacturing expenses and operating expenses for the three-month periods ended March 31, 2024 and 2023, respectively. Payment term for the related party was 45 days after month-end.
(6) The Group had transactions with other related party and recognized NT$239 thousand as operating expenses for the three-month period ended March 31, 2024. Payment term for the related party was 45 days after month-end.
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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(7) Key management personnel compensation

For the three-month periods ended

Short-term employee benefits Post-employment benefits Total	March 31,	March 31,
	2024	2023
	$31,501 451	$27,326 484
	$31,952	$27,810

8. Assets Pledged as Security

The following table lists assets of the Group pledged as security:

Assetspledged for security		As of		Secured liabilities
	March 31, 2024	December 31, 2023	March 31, 2023
Financial assets measured at amortized cost-non-current	$4,230	$4,230	$4,230	Guarantee for land

9. Significant Contingencies and Unrecognized Contractual Commitments

The Group uses patents of other companies for certain products, and will pay royalty fees based on sales amounts or quantities of these products in accordance with the agreements.

10.Losses Due to Major Disasters

None.

11.Significant Subsequent Events

None.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

12.Others

(1) Categories of financial instruments

Financial assets

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$574,450 1,311,397 4,708,404	$569,769 1,459,037 4,186,219	$862,953 1,389,964 2,961,193
$6,594,251	$6,215,025	$5,214,110

Financial liabilities

	As of
March 31, 2024	December 31, 2023	March 31, 2023
$1,023,291 81,230 28,290	$1,118,264 83,163 28,290	$885,769 88,760 28,290
$1,132,811	$1,229,717	$1,002,819

Note: Including cash and cash equivalents (excluding cash on hand), financial assets measured at amortized cost, notes receivables, trade receivables (including related parties), other receivables and other non-current assets (refundable deposits).

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(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 appetite.

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 risks 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 revenues or expenses are denominated in a different currency from the Group’s functional currency) and the Group’s net investments in foreign subsidiaries.

The Group has certain foreign currency receivables to be denominated in the same foreign currency with certain foreign currency payables, therefore natural hedge is received. 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. The information of the sensitivity analysis is as follows:

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

When NTD strengthens/weakens against USD by 5%, the profit for the three-month periods ended March 31, 2024 and 2023 would decrease/increase by NT$16,828 thousand and NT$11,676 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 doesn’t have any liabilities risk of changes in market interest rates. Therefore, the Group expects no fair value and cash flow risks due to significant interest rate fluctuations.

All of the Group’s financial assets and financial liabilities that are exposed to cash flow risk due to fluctuating interest rate are under short term contracts, thus the cash flow risk of fluctuate interest is considerably low.

The interest rate sensitivity analysis is performed on items exposed to interest rate risk as of the end of the reporting period, including investments with variable interest rate. At the reporting date, an increase/decrease of 10 basis points (0.1%) of interest rate in a reporting period could cause the profit for the three-month periods ended March 31, 2024 and 2023 to increase/decrease by NT$0 and NT$1 thousand, respectively.

Equity price risk

The Group’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties about future values of the investment objectives. The Group’s listed and unlisted equity securities are classified as financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income. The Group manages the equity price risk through diversification and placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Group’s senior management on a regular basis. The Board of Directors reviews and approves certain equity investments according to level of authority.

For the three-month periods ended March 31, 2024 and 2023, a change of 10% in the price of the listed equity instrument investments measured at fair value through other comprehensive income could increase/decrease by NT$21,635 thousand and NT$31,978 thousand, respectively.

Please refer to Note 12(8) for sensitivity analysis information of other equity instruments that are linked to such equity instruments whose fair value measurement is categorized under Level 3 of the fair value hierarchy.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(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 trade receivables and notes receivables) 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 counter parties based on their financial position, rating from credit rating agencies, historical experience, prevailing economic condition and the Group’s internal rating criteria, etc. Certain counter parties’ credit risk will also be managed by taking credit enhancing procedures, such as requesting for prepayment.

As of March 31, 2024, December 31, 2023 and March 31, 2023, trade receivables from top ten customers represented 91.24%, 93.34% and 94.70% of the total trade receivables of the Group, respectively. The credit concentration risk of other trade receivables is insignificant.

Credit risk from balances with banks 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 and companies with good credit rating. Consequently, there is no significant credit risk for these counter parties.

The Group adopted IFRS 9 to assess the expected credit losses. The measurement indicators of the Group are described as follows:

Level of credit risk	Indicator	Measurement method for expected credit losses	Gross carrying amount as of	Gross carrying amount as of	Gross carrying amount as of
			March 31, 2024	December 31,	March 31, 2023
				2023
Simplified approach (Note)	(Note)	Lifetime expected credit losses	$864,477	$876,067	$797,745

Note: By using simplified approach (loss allowance is measured at lifetime expected credit losses), including notes receivables, trade receivables and trade receivables from related parties.

Financial assets are written off when there is no realistic prospect of future recovery.

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(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 and financial assets and liabilities at fair value through profit or loss. The table below summarizes the maturity profile of the Group’s financial liabilities based on the contractual undiscounted payments and contractual maturity. The payment amount includes the contractual interest.

Non-derivative financial liabilities

March 31, 2024 Payables (including related parties) Lease liabilities Deposits received December 31, 2023 Payables (including related parties) Lease liabilities Deposits received March 31, 2023 Payables (including related parties) Lease liabilities Deposits received	Less than 1year	2 to 3years	4 to 5years	5 to 15 years	15 to 20 years	> 20years	Total
	$1,023,291 $6,467 $- $1,118,264 $7,512 $- $885,769 $9,112 $-	$- $9,875 $28,290 $- $9,904 $28,290 $- $11,374 $28,290	$- $8,846 $- $- $9,017 $- $- $9,571 $-	$- $41,856 $- $- $41,856 $- $- $41,856 $-	$- $13,219 $- $- $13,722 $- $- $15,230 $-	$- $17,578 $- $- $18,121 $- $- $19,752 $-	$1,023,291 $97,841 $28,290 $1,118,264 $100,132 $28,290 $885,769 $106,895 $28,290

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(6) Reconciliation of liabilities arising from financing activities

Reconciliation of liabilities for the three-month periods ended March 31, 2024 and 2023:

Deposits received	Lease liabilities	Total liabilities from financing activities
$28,290 - -	$83,163 (1,933) -	$111,453 (1,933) -
$28,290	$81,230	$109,520
$28,290 - -	$87,493 (1,785) 3,052	$115,783 (1,785) 3,052
$28,290	$88,760	$117,050

(7) Fair value 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, trade receivables (including related parties), other receivables, other non-current assets, payables (including related parties) and deposits received approximate their fair value due to their short maturities.
II. For financial assets and liabilities 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 funds) at the reporting date.
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ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

III.Fair value of equity instruments without market quotations (including private company equity securities) is estimated using the market approach and asset approach valuation techniques based on parameters such as prices based on market transactions of equity instruments of identical or comparable entities and other relevant information (for example, inputs such as discount for lack of marketability, P/E ratio of similar entities and Price-Book ratio of similar entities).
(b) Fair value of financial instruments measured at amortized cost

The carrying amounts of the Group’s financial assets and liabilities measured at amortized cost approximate their fair value.

Please refer to Note 12(8) for fair value measurement hierarchy for financial instruments of the Group.

(8) 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.

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 assets or liabilities.

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:

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ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

As of March 31, 2024:

Level 1	Level 2	Level3	Total
$439,400 - 216,352	$- - -	$- 135,050 1,095,045	$439,400 135,050 1,311,397
$655,752	$-	$1,230,095	$1,885,847
Level 1	Level 2	Level3	Total
$435,830 - 333,627	$- - -	$- 133,939 1,125,410	$435,830 133,939 1,459,037
$769,457	$-	$1,259,349	$2,028,806

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

As of March 31, 2023:

Financial assets at fair value: Financial assets at fair value through profit or loss Funds Capital Financial assets at fair value through other comprehensive income Equity instruments measured at fair value through other comprehensive income Total	Level 1	Level 2	Level3	Total
	$752,412 - 319,776	$- - -	$- 110,541 1,070,188	$752,412 110,541 1,389,964
	$1,072,188	$-	$1,180,729	$2,252,917

Transfers between Level l and Level 2 during the period

During the three-month periods ended March 31, 2024 and 2023, 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
At fair value through profit or loss	At fair value through other comprehensive income	Total
Capital	Stocks
$133,939 1,111 -	$1,125,410 - (30,365)	$1,259,349 1,111 (30,365)
$135,050	$1,095,045	$1,230,095

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

	Assets
At fair value through profit or loss	At fair value through other comprehensive income	Total
Capital	Stocks
$65,086 (4,558) - 50,013	$953,970 - 116,218 -	$1,019,056 (4,558) 116,218 50,013
$110,541	$1,070,188	$1,180,729

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, 2024

Financial assets: Financial assets at fair value through profit or loss Capital	Valuation technique	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity analysis of the input to fair value
	Asset approach	Discount for lack of marketability	10%	The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$15,006 thousand

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Valuation technique Financial assets at fair value through other comprehensive income Stocks Market approach Stocks Asset approach As of December 31, 2023 Valuation technique Financial assets: Financial assets at fair value through profit or loss Capital Asset approach Financial assets at fair value through other comprehensive income Stocks Market approach	Valuation technique	Significant unobservableinputs	Quantitative information	Relationship between inputs andfairvalue	Sensitivity analysis of the input to fairvalue
		Discount for lack of marketability Discount for lack of marketability Significant unobservable inputs	30% 10% Quantitative information	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated Relationship between inputs and fair value	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$20,230 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$105,967 thousand Sensitivity analysis of the input to fair value
	Asset approach Market approach	Discount for lack of marketability Discount for lack of marketability	10% 30%	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$14,882 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$20,662 thousand

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English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Valuation technique Stocks Asset approach As of March 31, 2023 Valuation technique Financial assets: Financial assets at fair value through profit or loss Capital Asset approach Financial assets at fair value through other comprehensive income Stocks Market approach Stocks Asset approach	Valuation technique	Significant unobservable inputs	Quantitative information	Relationship between inputs and fair value	Sensitivity analysis of the input to fair value
		Discount for lack of marketability Significant unobservable inputs	10% Quantitative information	The higher the discount for lack of marketability, the lower the fair value estimated Relationship between inputs and fair value	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$108,975 thousand Sensitivity analysis of the input to fair value
	Asset approach Market approach Asset approach	Discount for lack of marketability Discount for lack of marketability Discount for lack of marketability	10% 30% 10%	The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated The higher the discount for lack of marketability, the lower the fair value estimated	10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s profit (loss) by NT$11,054 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$11,183 thousand 10% increase (decrease) in the discount for lack of marketability would result in (decrease) increase in the Group’s equity by NT$95,836 thousand

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

The Group validates the fair value measurements and ensures 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 also analyses the movements in the values of assets and liabilities which are required to be re-measured or re-assessed based on the Group’s accounting policies at each reporting date.

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ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(9) Significant assets and liabilities denominated in foreign currencies

Information regarding the significant financial assets and liabilities denominated in foreign currencies is listed below:

Financial assets			As	of	of	of
		March 31,2024		December 31,2023
	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)
	$16,934 $6,419	As of 32.005 32.005	$541,979 $205,428	$17,268 $7,089	30.705 30.705	$530,202 $217,676
Monetary items: USD Financial liabilities
Financial assets Monetary items: USD
		March 31,2023
	Foreign currencies (In thousands)	Foreign exchange rate	NTD (In thousands)
	$12,754 $5,082	30.44 30.44	$388,228 $154,708
Monetary items: USD Financial liabilities
Monetary items: USD

During the three-month periods ended March 31, 2024 and 2023, the foreign exchange gains (losses) were NT$13,030 thousand and NT$(2,381) thousand, respectively.

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

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ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(10) 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.

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ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

13.Additional Disclosure

(1) Information at significant transactions

Additional disclosures for information of the Company for the three-month period ended March 31, 2024:

(a) Financing provided to others: None.

(b) Endorsement/Guarantee provided to others: None.

Held Company Name	Marketable Securities Type and Name	Marketable Securities Type and Name	Relationship with the Company	Financial Statement Account		March 31,2024	March 31,2024
					Shares/Units	Carrying Value/ Thousands of NTD	Percentage of Ownership (%)	Fair Value/ Thousands of NTD
ITE Tech. Inc.	Common Stock	Unitech Capital, Inc.	-	Financial assets at fair value through other comprehensive income,non-current	2,000,000	$49,360	4.00%	$49,360
	Common Stock	Shieh Yong Investment Co., Ltd.	-	Financial assets at fair value through other comprehensive income,non-current	32,506,937	$300,364	1.52%	$300,364
	Common Stock	Darjun Venture Corporation	-	Financial assets at fair value through other comprehensive income,non-current	9,280,000	$85,283	19.61%	$85,283
	Common Stock	TriKnight Capital Corporation	-	Financial assets at fair value through other comprehensive income,non-current	28,841,800	$214,006	5.00%	$214,006
	Common Stock	Darhe II Venture Corporation	-	Financial assets at fair value through other comprehensive income,non-current	10,000,000	$92,200	14.29%	$92,200
	Common Stock	Darchan Venture Corporation	-	Financial assets at fair value through other comprehensive income,non-current	20,000,000	$179,200	18.18%	$179,200
	Common Stock	Darjiun Venture Corporation	-	Financial assets at fair value through other comprehensive income,non-current	3,750,000	$33,037	10.00%	$33,037
	Common Stock	Generiton Co., Ltd.	-	Financial assets at fair value through other comprehensive income,non-current	508,047	$29,401	12.70%	$29,401

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Held Company Name	Marketable Securities Type and Name	Marketable Securities Type and Name	Relationship with the Company	Financial Statement Account		March 31,2024	March 31,2024
					Shares/Units	Carrying Value/ Thousands of NTD	Percentage of Ownership (%)	Fair Value/ Thousands of NTD
ITE Tech. Inc.	Common Stock	Embestor Technology Inc.	-	Financial assets at fair value through other comprehensive income,non-current	4,400,000	$92,224	16.92%	$92,224
	Common Stock	Isentek Inc.	-	Financial assets at fair value through other comprehensive income,non-current	1,000,000	$19,970	3.30%	$19,970
	Common Stock	Gigastone Corporation	-	Financial assets at fair value through other comprehensive income,non-current	676,841	$44,320	1.34%	$44,320
	Common Stock	M3 Technology Inc.	-	Financial assets at fair value through other comprehensive income,non-current	1,024,000	$172,032	2.41%	$172,032
	Fund	Taishin 1699 Money Market Fund	-	Financial assets at fair value through profit or loss, current	7,181,792.72	$100,465	-	$100,465
	Fund	Taishin Ta Chong Money Market Fund	-	Financial assets at fair value through profit or loss, current	6,862,109.20	$100,570	-	$100,570
	Fund	Nomura Taiwan Money Market Fund	-	Financial assets at fair value through profit or loss, current	8,979,535.66	$150,811	-	$150,811
	Fund	Fubon Chi-Hsiang Money Market Fund	-	Financial assets at fair value through profit or loss, current	3,112,666.10	$50,285	-	$50,285
	Fund	Yuanta/P-shares Taiwan Dividend Plus ETF	-	Financial assets at fair value through profit or loss, non-current	935,000	$37,269	-	$37,269
	Capital	TGVest Asia Partners II (Taiwan),L.P.	-	Financial assets at fair value through profit or loss, non-current	-	$135,050	-	$135,050

52 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(d) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20 percent of the capital stock: None.
(e) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock: None.
(f) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20 percent of the capital stock: None.
(g) Related party transactions for purchases and sales amounts exceeding the lower of NT$100 million or 20 percent of the capital stock:

Amount: Thousands of NTD

Company Name	Related Party	Nature of Relationship		Transaction Details	Transaction Details		Abnormal Transaction	Abnormal Transaction	Notes/Trade (Payable) or Receivable	Notes/Trade (Payable) or Receivable	Note
			Purchases/ Sales	Amount	% to Total	Payment Terms	Unit Price	Payment Terms	Ending Balance	% to Total
ITE Tech. Inc.	United Microelectronics Corp.	Directors of the Company	Purchases	$195,894	66.89%	45 days after month-end	Not comparable to the market due to differentiation of manufacturing process and product specification.	Same as general trading conditions	$(127,270)	(25.94)%

(h) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20 percent of the capital stock as of March 31, 2024: None.
(i) Trading in derivative instruments: None.
53 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(j) Intercompany relationship and significant intercompany transactions:

No. (Note 1)	Company Name	Counter Party	Nature of Relationship (Note 2)		IntercompanyTransactions	IntercompanyTransactions	IntercompanyTransactions
				Financial Statement Item	Amount	Term	Percentage of Consolidated Net Revenue or Total Assets (Note 3)
0	ITE Tech. Inc.	ITE Tech. (Shenzhen) Inc.	1	Administrative expenses	$9,718	On demand	0.64%

Note 1: Number should be input in the remark column for intercompany transactions. Here illustrate how to assign numbers to transactions. 1. 0 for parent company.
Subsidiaries are given a number in sequence starting with No. 1.
Note 2: There are three types of transactions. Please remark the type of transaction by giving a number to it.
Parent to Subsidiary.
Subsidiary to Parent.
Subsidiaries to Subsidiaries.
Note 3: Asset/liability items are calculated by using the ending balances of the item divided by ending balance of total consolidated assets; profit/loss items are calculated by using the amount of the transaction divided by total consolidated revenue.
54 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

(2) Information on investees

Names, locations and related information of investees as of March 31, 2024 (excluding investment in Mainland China):

Amount: Thousands of NTD

Investor Company	Investee Company	Location	Main Businesses and Products	Original Investment Amount	Original Investment Amount	Balances as of March 31,2024	Balances as of March 31,2024	Balances as of March 31,2024	Net Income (Losses) of the Investee Company	Share of Profits /(Losses)	Note
				March 31, 2024	December 31, 2023	Shares	Percentage of Ownership	Carrying Value
ITE Tech. Inc.	Emright Technology Co., Ltd.	Taiwan	Communication machinery equipment, electronic components manufacturing	$41,768	$41,768	4,176,800	30.15%	$10,050	$(5,817)	$(1,754)

(3) Investment in Mainland China

(a) Investment situation:

Amount: US Dollars/Thousands of NTD

Investee Company	Main Businesses and Products	Total Amount of Paid-in Capital (Note 4)	Method of Investment	Accumulated outflow of Investment from Taiwan as of January 1, 2024 (Note 4)	Investment Flows	Investment Flows	Accumulated outflow of Investment from Taiwan as of March 31, 2024 (Note 4)	Percentage of Ownership	Net Income (Losses) of the Investee Company	Share of Profits /(Losses) (Note 3)	Carrying Amount as of March 31, 2024 (Note 3)	Accumulated Inward Remittance of Earnings as of March 31, 2024
					Outflow	Inflow
ITE Tech. (Shenzhen) Inc.	Technological consultation services for ICsproducts	$19,203 USD 600,000	Direct investment in Mainland China(Note 1)	$19,203 USD 600,000	$-	$-	$19,203 USD 600,000	100%	$372	$372	$2,480	$-

55 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

Accumulated Investment in Mainland China as of March 31,2024	Investment Amounts Authorized by Investment Commission,MOEA	Upper Limit on Investment
$19,203 (Note 4) (USD600,000)	$19,203 (Note 4) (USD600,000)	$4,076,044 (Note 2)

Note 1: The Company has been approved the investment which that changed the investment structure and directly invested in ITE Tech. (Shenzhen) Inc. by the Investment Commission, MOEA.
Note 2: lBased on Regulations Governing the Approval of Investment or Technical Cooperation in the Mainland China promulgated by Investment Commission, MOEA.
Note 3: According to regulations, it may be evaluated based on the financial statements of the investee company un-reviewed by the accountant during the same period.
Note 4: Converted to NTD at the exchange rate on the financial reporting date (1 USD=32.005 NTD).

(b) Significant direct or indirect transactions with the investees in Mainland China:

I. The amount and percentage of purchases and the balance and percentage of the related payables at the end of the period: None. II. The amount and percentage of sales and the balance and percentage of the related receivables at the end of the period: None. III.The amount of property transactions and the amount of the resultant gains or losses: None.

IV.The balance of negotiable instrument endorsements or guarantees or pledges of collateral at the end of the period and the purposes: None.

56 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

V. The highest balance, the end of period balance, the interest rate range, and total current period interest with respect to financing of funds: None.
VI.Other transactions that have a material effect on the profit or loss for the period or on the financial position, such as the rendering or receiving of services: Please refer to Note 13(1) (j).

(4) Information of major shareholders

Name of major shareholders	Number of shares held (shares)	Percentage of ownership
United Microelectronics Corp.	13,959,978	8.66%

Note1: The main shareholder information in this table is calculated by the Taiwan Depository & Clearing Corporation on the last business day at the end of each quarter. The total number of ordinary shares and special shares held by the shareholders who have completed the delivery of the Company without physical registration (including treasury shares) is more than 5%. As for the share capital recorded in the Company's financial report and the number of shares actually delivered by the Company without physical registration, the calculation basis may be different or inconsistent.
Note2: If the above data is number of trusted shares, it is disclosed by accounts of trustee. The report of shareholders who holding more than 10% ownership according to Securities and Exchange Act, includes the shares held by shareholders and trusted assets with right to use. Please refer to Market Observation Post System for insiders to report changes in shareholding to the Company.
57 -

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(Amounts are expressed in thousands of New Taiwan Dollars unless otherwise stated)

14.Segment information

General Information

The products of the Group 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 Material Accounting Policies.

58 -

AI assistant

ITE — Interim / Quarterly Report 2024

52248_rns_2024-11-29_9cb21a40-36df-4ac4-830b-f152df267642.pdf

English Translation of a Report and Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

Notice to Readers

Independent Auditors’ Review Report Translated from Chinese

Introduction

Scope of Review

Basis for Qualified Conclusion

Qualified Conclusion

Notice to Readers

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

March 31, 2024, December 31, 2023 and March 31, 2023

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

March 31, 2024, December 31, 2023 and March 31, 2023

English Translation of Consolidated Financial Statements Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three-month periods ended March 31, 2024 and 2023

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the three-month periods ended March 31, 2024 and 2023

English Translation of Consolidated Financial Statements Originally Issued in Chinese ITE TECH. INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

1. Organization and Operation

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

3. Newly Issued or Revised Standards and Interpretations

4. Summary of Material Accounting Policies

Preparation principle of consolidated financial statements

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(5) Post-employment benefits

5. Significant Accounting Judgments, Estimates and Assumptions

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. Contents of Significant Accounts

(1) Cash and cash equivalents

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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

(5) Notes receivables

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(6) Trade receivables and trade receivables from related parties

(7) Inventories

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(8) Investments accounted for using the equity method

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(9) Property, plant and equipment

English Translation of Consolidated Financial Statements and Footnotes Originally Issued in Chinese

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(10) Intangible assets

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(11) Other current liabilities

(12) Post-employment benefits plans

Defined contribution plan

Defined benefit plan

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(13) Equity

(a) Common stock

(b) Capital surplus

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(14) Share-based payment plans

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Restricted shares plans for employees

(15) Operating revenues

(a) Contract balances

ITE TECH. INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(b) Transaction price allocated to unsatisfied performance obligations

ITE Interim / Quarterly Report 2024