Announcement on Accrual of Asset Impairment Provisions for 2025

Securities Code: 002387 Securities Abbreviation: VIMICRO Announcement No.: 2026-054 VIMICRO Corporation Announcement on Accrual of Asset Impairment Provisions for 2025 The Company and all members of the Board of Directors guarantee the content of the information disclosure is true, accurate, and complete, and that there are no false records, misleading statements, or major omissions. In accordance with the "Accounting Standards for Business Enterprises" and the "Code of Corporate Governance for Listed Companies on the Main Board of the Shenzhen Stock Exchange" and other relevant regulations, VIMICRO Corporation (hereinafter referred to as the "Company") has accrued impairment provisions for assets with potential impairment signs. The specific details of this accrual are as follows: I. Overview of Impairment Provision Accrual To accurately reflect the Company's financial position and asset status as of December 31, 2025, based on the prudence principle, and in accordance with the "Accounting Standards for Business Enterprises" and the Company's accounting policies, the Company has assessed whether there are signs of impairment for assets such as receivables, inventory, and fixed assets as of December 31, 2025, and conducted impairment tests. The test results show that in 2025, the Company accrued RMB 4,849.54 million in impairment losses for receivables, including RMB 1,158.42 million for accounts receivable and RMB 3,690.50 million for other receivables; RMB 7,473.16 million in impairment losses for inventory; RMB 12,437.74 million in impairment losses for fixed assets; and RMB 749.45 million in impairment losses for construction in progress. The situation of impairment provision accrual for 2025 is as follows: Unit: RMB million Item Opening Balance Accrued in Current Period Other Reductions Write-off and Others Other Increases Balance as of December 31, 2025 Proportion of 2025 Accrued Amount to Audited Net Profit Attributable to Parent Company for 2025 I. Impairment Provisions for Receivables 11,387.04 4,849.54 1.50 0.15 897.98 17,132.91 -2.03% Of which: Accounts Receivable 2,437.26 1,158.42 4,487.79 -0.48% 0.04 892.15 Other Receivables 8,949.78 3,690.50 12,644.50 -1.54% 1.50 0.11 5.83 Notes Receivable 0.61 0.61 0.00% II. Inventory Price Decline Provisions 22,586.89 7,473.16 21,631.60 -3.13% 8,695.60 267.15 III. Fixed Asset Impairment Provisions 33,218.51 12,437.74 36,569.13 -5.21% 11,659.33 2,572.21 IV. Intangible Asset Impairment Provisions 2,450.22 2,450.22

V. Goodwill VI. Construction in Progress Impairment Provisions 749.45 749.45 -0.31% Total 69,642.66 25,509.88 20,356.42 0.15 3,737.34 78,533.31 -10.68% Note 1: Impairment of receivables is reported as a negative number under "Impairment Losses on Receivables" in the income statement; impairment of other assets is reported as a negative number under "Asset Impairment Losses" in the income statement. Note 2: Other increases represent the amount of new asset impairment provisions arising from business combinations under common control. II. Methods for Accruing Impairment Provisions for Various Assets (I) Impairment of Financial Assets The Company applies impairment accounting and recognizes impairment provisions based on expected credit losses for financial assets classified as measured at amortized cost, financial assets classified as measured at fair value through other comprehensive income, and financial guarantee contracts. For receivables arising from transactions regulated by revenue recognition standards, the Company uses a simplified measurement approach, recognizing impairment provisions equivalent to the expected credit losses over the entire contract period. For financial assets that have already experienced credit impairment at the time of purchase or origination, the cumulative change in expected credit losses over the entire contract period since initial recognition is recognized as an impairment provision at the balance sheet date. At each balance sheet date, the change in expected credit losses over the entire contract period is recognized as an impairment loss or gain in profit or loss for the current period. Even if the expected credit losses over the entire contract period at the balance sheet date are less than the expected credit losses reflected in the initial measurement of cash flows, any favorable change in expected credit losses is recognized as an impairment gain. For other financial assets, excluding those measured using the simplified approach and those that have already experienced credit impairment at the time of purchase or origination, the Company assesses at each balance sheet date whether the credit risk of the relevant financial instrument has increased significantly since initial recognition. The loss provisions and expected credit losses and their changes are measured according to the following circumstances: If the credit risk of the financial instrument has not increased significantly since initial recognition, it is in the first stage, and the loss provision is measured at the amount of expected credit losses for the next 12 months, and interest income is calculated based on the carrying amount and the effective interest rate. If the credit risk of the financial instrument has increased significantly since initial recognition but has not yet experienced credit impairment, it is in the second stage, and the loss provision is measured at the amount of expected credit losses over the entire contract period, and interest income is calculated based on the carrying amount and the effective interest rate. If the financial instrument has already experienced credit impairment since initial recognition, it is in the third stage, and the Company measures the loss provision at the amount of expected credit losses over the entire contract period and calculates interest income based on the amortized cost and the effective interest rate. For financial assets classified as measured at fair value through other comprehensive income, the Company recognizes their impairment provisions in other comprehensive income, without reducing the carrying amount of these financial assets on the balance sheet. If the Company had previously measured the loss provision at the amount of expected credit losses over the entire contract period for a financial instrument, but at the current balance sheet date, the financial instrument no longer falls under the condition of significant increase in credit risk since initial recognition, the Company measures the loss provision for this financial instrument at the amount of expected credit losses for the next 12 months at the current balance sheet date. Any reversal of the loss provision formed will be recognized as an impairment gain in profit or loss for the current period. The Company assesses expected credit losses for financial instruments on a standalone and collective basis, considering reasonable and supportable information about past events, current conditions, and future economic forecasts. The Company groups financial instruments into different portfolios based on common credit risk characteristics. The common credit risk characteristics adopted by the Company include: nature portfolio, other portfolios, etc.

1. Notes Receivable The method for determining expected credit losses and accounting treatment for notes receivable is detailed in (I) Impairment of Financial Assets above.
2. Accounts Receivable The method for determining expected credit losses and accounting treatment for accounts receivable is detailed in (I) Impairment of Financial Assets above. When it is not possible to reasonably estimate the expected credit loss information for a standalone financial asset, the Company classifies accounts receivable into nature portfolios and other portfolios based on credit risk characteristics and calculates expected credit losses on a portfolio basis. Portfolio Name Basis for Determining Portfolio Measurement Method Nature Portfolio This portfolio includes internal accounts receivable with low credit risk, mainly including amounts due from related parties. Based on historical credit loss experience, combined with current conditions and forecasts of future economic conditions, expected credit losses are calculated through default risk exposure and the expected credit loss rate over the entire contract period. Other Portfolio The aging of accounts receivable is used as the credit risk characteristic. Accrued based on aging and the expected credit loss rate over the entire contract period.
3. Notes Receivable Financing The method for determining expected credit losses and accounting treatment for notes receivable financing is detailed in (I) Impairment of Financial Assets above.
4. Other Receivables The method for determining expected credit losses and accounting treatment for other receivables is detailed in (I) Impairment of Financial Assets above. When it is not possible to reasonably estimate the expected credit loss information for a standalone financial asset, the Company classifies them into nature portfolios and other portfolios based on credit risk characteristics. The Company calculates expected credit losses on a portfolio basis by referencing historical credit loss experience, combined with current conditions and forecasts of future economic conditions. Portfolio Name Basis for Determining Portfolio Measurement Method Nature Portfolio This portfolio includes other receivables with low credit risk, mainly including amounts due from related parties, employee loans, advances, amounts due for deposits, and amounts due from government departments. Based on historical credit loss experience, combined with current conditions and forecasts of future economic conditions, expected credit losses are calculated through default risk exposure and the expected credit loss rate for the next 12 months or the entire contract period. Other Portfolio The aging of other receivables is used as the credit risk characteristic. Accrued based on aging and the expected credit loss rate over the entire contract period. (II) Inventory Price Decline Provisions The Company's inventory includes raw materials, work-in-progress, finished goods, etc. At the balance sheet date, inventory is measured at the lower of cost and net realizable value. If the cost exceeds the net realizable value, an inventory price decline provision is accrued and recognized as an asset impairment loss. The basis for determining net realizable value is as follows:
5. Finished goods and materials directly for sale: In the normal course of business, net realizable value is determined by deducting estimated selling expenses and related taxes and fees from the estimated selling price of the inventory.
6. Materials and work-in-progress that require further processing: In the normal course of business, net realizable value is determined by deducting the estimated costs to complete, estimated selling expenses, and related taxes and fees from the estimated selling price of the finished products to be produced. The difference between the inventory cost and the net realizable value at the balance sheet date is the inventory price decline provision to be accrued. If the factors that caused the previous reduction in inventory value have disappeared, the reduced amount is restored and reversed within the previously accrued inventory price decline provision, and the reversed amount is recognized in profit or loss for the current period. Inventory write-offs are mainly for finished goods sold externally, with the corresponding inventory price decline provisions being transferred. (III) Impairment of Assets Held for Sale If the carrying amount of non-current assets or disposal groups held for sale exceeds their fair value less costs to sell, the carrying amount is reduced to the fair value less costs to sell, and the reduction amount is recognized as an asset impairment loss, recognized in profit or loss for the current period, and the impairment provision for assets held for sale is accrued simultaneously. (IV) Long-term Asset Impairment At the balance sheet date, the Company determines whether there are any signs of impairment for long-term assets. If there are signs of impairment, the recoverable amount of the asset is estimated on a standalone basis. If it is not possible to estimate the recoverable amount of a standalone asset, the recoverable amount of the asset group to which the asset belongs is used to determine the recoverable amount. Determination of Recoverable Amount and Impairment Accrual Method for Long-term Assets:
7. Determination of Asset Recoverable Amount: Determined by the higher of its fair value less costs of disposal and the present value of the asset's expected future cash flows.
8. Impairment Accrual Method: If the recoverable amount of a long-term asset is lower than its carrying amount, the carrying amount of the long-term asset is reduced to the recoverable amount, and the reduction amount is recognized as an asset impairment loss, recognized in profit or loss for the current period, and the corresponding asset impairment provision is accrued. Once recognized, asset impairment losses cannot be reversed in subsequent accounting periods. After the recognition of asset impairment loss, the depreciation or amortization expense of the impaired asset is adjusted in future periods to systematically allocate the adjusted carrying amount of the asset (net of estimated residual value) over its remaining useful life. Goodwill and intangible assets with indefinite useful lives arising from business combinations are tested for impairment annually, regardless of whether there are signs of impairment. The impairment testing method for goodwill is as follows: When testing goodwill for impairment, the carrying amount of goodwill is allocated to the asset group or groups of asset groups that are expected to benefit from the synergistic effects of the business combination. When testing the asset group or groups of asset groups containing goodwill for impairment, if there are signs of impairment in the asset group or groups of asset groups not containing goodwill, the asset group or groups of asset groups not containing goodwill are tested for impairment first, and their recoverable amounts are calculated and compared with their carrying amounts to recognize any impairment loss. Then, the asset group or groups of asset groups containing goodwill are tested for impairment. The carrying amount of these related asset groups or groups of asset groups (including the carrying amount of allocated goodwill) is compared with their recoverable amounts. If the recoverable amount of the related asset group or groups of asset groups is lower than their carrying amount, the impairment loss of goodwill is recognized. III. Impact of This Impairment Provision Accrual on the Company In 2025, the Company accrued RMB 25,509.88 million in impairment provisions for receivables and assets, resulting in a decrease of RMB 25,509.88 million in the Company's total profit for 2025, a decrease of RMB 21,644.20 million in net profit attributable to the parent company, and a decrease of RMB 21,644.20 million in owners' equity attributable to the parent company. The impairment provisions accrued in 2025 and their impact on the Company's relevant financial indicators have been audited by the accounting firm. IV. Board of Directors' Statement The Company's accrual of asset impairment provisions this time is based on the actual situation of the Company's relevant assets and the prudence principle, in compliance with the "Accounting Standards for Business Enterprises" and other relevant regulations, with reasonable and sufficient grounds for accrual. After the accrual of asset impairment provisions, the Company's 2025 financial statements can more objectively reflect the Company's current financial position, asset value, and operating results, making the Company's financial information more reasonable. This accrual of asset impairment losses does not involve profit manipulation. V. Documents for Inspection
9. Statement of the Board of Directors of VIMICRO Corporation on the Reasonableness of Accruing Asset Impairment Provisions for 2025. Hereby announced. Board of Directors of VIMICRO Corporation April 29, 2026