Feitian Technologies Co., Ltd. 2026 Semi-Annual Report
[August 2026]
Section 1 Important Notices, Table of Contents, and Definitions
The Board of Directors, the Board of Supervisors, and the directors, supervisors, and senior management of the Company guarantee that the information in this semi-annual report is true, accurate, and complete, and contains no false records, misleading statements, or major omissions, and they assume individual and joint legal liability.
The Company's person in charge, Huang Yu, the person in charge of accounting, Zhu Baoxiang, and the head of the accounting department (accounting supervisor), Shi Jingping, declare: We guarantee the truth, accuracy, and completeness of the financial reports in this semi-annual report.
All directors have attended the Board meeting to review this semi-annual report.
The forward-looking statements regarding development strategies and business plans in this report are planned matters and do not constitute substantive commitments by the Company to investors. Investors and relevant parties should maintain sufficient risk awareness and understand the differences between plans, forecasts, and commitments. Investors are advised to be aware of investment risks.
(1) Risk of continuous market shrinkage for identity authentication products
The Company's traditional business consists of identity authentication products represented by USB Keys and OTP, with banks as the primary customers. Currently, the demand for online banking products such as USB Keys and OTP is continuously declining, which has a significant impact on the Company's operating performance.
To this end, while striving to maintain the market for existing core products, the Company will conduct research and development and market expansion for other products to cultivate new growth points.
(2) Risk of new business expansion falling short of expectations
The Company has conducted research and development and market expansion in the field of intelligent terminals and has achieved certain results. However, if the economic and market environment changes or new business expansion falls short of expectations, it will have an adverse impact on the Company's operating performance.
The Company conducts market research and risk management prudently during business implementation to reduce relevant risks.
(3) R&D investment risk
To cope with increasingly fierce competition, the Company will optimize its R&D direction and improve its innovation capabilities. However, R&D activities are uncertain, and there is a possibility that R&D investment may not be realized.
The Company strives to conduct detailed market research in the early stages of R&D to improve its judgment of the market, and strictly manages development progress and effectiveness during the R&D process to maximize efficiency.
(4) Risk of performance fluctuations caused by the increase in the proportion of overseas revenue
In recent years, the Company's revenue from overseas has continued to grow rapidly, and its proportion of the Company's total revenue has continued to increase. In the future, factors such as intensified competition in foreign markets, trade barriers, or foreign trade friction may have a significant adverse impact on the Company's export sales, and there is a risk that export revenue may slow down or decline. In addition, with the growth of export revenue, the Company's performance faces the risk of fluctuations due to exchange rate changes.
The Company will increase its efforts to expand overseas customers, actively maintain relationships with core overseas customers, closely monitor changes in overseas market demand, and adopt targeted marketing and product strategies based on market trends. At the same time, the Company will adjust foreign currency deposits in a timely manner according to the expected trend of the US dollar and use foreign exchange financial instruments at appropriate times to reduce risks.
The Company plans not to distribute cash dividends, not to issue bonus shares, and not to increase share capital from the capital reserve.