AAC Technologies' revenue in the first nine months of 2021 was 12.86 billion yuan, up 4% year-on-year

On November 11, AAC Technologies announced its third quarter results for 2021. In the first nine months of 2021, AAC Technologies achieved revenue of RMB 12.86 billion, up 4% year-on-year, gross profit margin of 26.3%, up 3 percentage points year-on-year, and net profit of RMB 1.1 billion, up 47.1% year-on-year. Revenue in the third quarter of 2021 was RMB 4.25 billion.

In terms of acoustics, in the first nine months of 2021, AAC Technologies' acoustic business achieved revenue of RMB 6.34 billion, a year-on-year increase of 15.5%, and a gross profit margin of 30.7%, an increase of 4.3 percentage points year-on-year. In the third quarter, the acoustic business revenue was RMB 2.2 billion, a year-on-year increase of 1.9%, and revenue increased by 7.8% month-on-month. In the third quarter of this year, AAC Technologies' standardized small-cavity acoustic modules accounted for nearly 10% of Android acoustic product shipments and will continue to increase. The increase in standardized product shipments is expected to further increase the gross profit margin of Android acoustic products. The application scenarios of overall acoustic solutions are becoming more and more extensive, bringing consumers a new immersive experience in the automotive field.

In terms of optics, in the first nine months of 2021, AAC Technologies' optical business achieved revenue of RMB 1.87 billion, a year-on-year increase of 70.4%, and a gross profit margin of 22.6%, an increase of 5.1 percentage points year-on-year. In the third quarter, the optical business revenue was RMB 390 million. WLG's glass-plastic hybrid lens business is progressing smoothly. Glass-plastic hybrid lenses have attracted more and more market attention due to their superior optical performance and the ability to effectively reduce the height of the lens. The trend of high-end smartphone lenses adopting glass-plastic hybrid designs is becoming more and more obvious.

In terms of electromagnetic transmission and precision structural parts, in the first nine months of 2021, the combined division achieved revenue of RMB 3.84 billion and a gross profit margin of 22.5%, an increase of 0.3 percentage points year-on-year. In the third quarter, the combined division had revenue of RMB 1.4 billion and a gross profit margin of 20.3%, an increase of 0.2 percentage points year-on-year. Compared with the second quarter, revenue increased by 14.5% month-on-month due to the month-on-month increase in shipments of major products. In terms of electromagnetic transmission, shipments of Android client horizontal linear motors doubled year-on-year. AAC Technologies has launched a variety of "hardware + software" integrated solutions to meet the needs of high, medium and low-end Android phones. The precision structural parts business, especially metal middle frame products, has made smooth progress in customer expansion and market development, with shipments of metal structural parts increasing by 33.8% month-on-month.

In terms of MEMS devices, AAC Technologies' MEMS device business achieved revenue of RMB 775 million in the first nine months of 2021, and RMB 254 million in the third quarter of 2021, a 6.5% increase from the second quarter. While AAC Technologies' MEMS microphones maintain a high market share in the smartphone market, they have expanded to TWS headsets, smart speakers, tablets, and automotive markets, and their market share continues to increase.

AAC Technologies management said that AAC Technologies will adhere to the strategy of innovation-driven development, continue to build differentiated product advantages and core competitiveness, actively expand the company's business, and accelerate the layout in strategic areas. On October 20, AAC Technologies announced that it plans to acquire 100% of the equity of Dongyang Precision Machinery (Kunshan) Co., Ltd. ("Dongyang Precision") for RMB 450 million. Dongyang Precision mainly manufactures metal frames, bottom shells and components for tablet computers, wearable devices and notebook computers. The acquisition will bring synergies to AAC Technologies' business development and enhance AAC Technologies' capabilities in precision structural parts, further expand AAC Technologies' business scope, strengthen customer relationships, enhance core competitiveness, and enhance sustainable development capabilities. In addition, on October 19, AAC Technologies announced its participation in SWIR Vision Systems' Series A investment. SWIR Vision Systems is a pioneer in developing next-generation image sensor solutions for industrial automation, consumer electronics, AR/VR systems, autonomous vehicles and other applications. This investment is in line with AAC Technologies' long-term strategic direction and will help further improve AAC Technologies' layout in the optical field by leveraging its unique wafer-level glass ("WLG") technology and high-end precision manufacturing capabilities.

In the automotive field, AAC Technologies has launched comprehensive intelligent automotive solutions, with a comprehensive product line covering everything from optics, acoustics, electromagnetic transmission to MEMS microphones, etc., to provide customers with a complete product portfolio. In particular, in the field of automotive lenses and laser radar ("LiDAR"), AAC Technologies' product portfolio already covers front-view, surround-view, occupant monitoring system ("OMS") and intelligent driver monitoring system ("DMS") automotive lenses. AAC Technologies is also actively contacting Tier 1 automotive suppliers and domestic new car-making forces to build a specific timetable for large-scale mass production of future products. At the same time, the development of higher-end products, including LiDAR lenses and automotive lens products using AAC Technologies' WLG technology, is also progressing steadily. With years of accumulated precision processing technology and automated production capabilities, AAC Technologies has great potential for expansion in the automotive vertical field, and will further promote the growth of AAC Technologies' business. In the future, AAC Technologies will continue to deepen its roots in existing mature industries, while actively seeking new development opportunities through technological innovation and investment, laying a solid foundation for longer-term sustainable development.