TCL科技:2023年年度报告（英文版）

Full Text of the Annual Report 2023 of TCL Technology Group Corporation

TCL 科技集团股份有限公司

TCL Technology Group Corporation

ANNUAL REPORT 2023

April 28 2024

1Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Amid rapids we beat the waves and sail steadily to reach far

ANNUAL REPORT 2023 Chairman's Statement

Amidst a tightening financial environment intensifying geopolitical conflicts and rapid

restructuring of global supply chain the world economy slowed down in 2023. In the wake of

opportunities amid challenges the economic restructuring brought new impetus to the transformation

and upgrading of the technology industry and the evolving global energy landscape further

highlighted the importantly strategic position of the new energy industry.With the strategic goal of becoming a global leading technology conglomerate the Company

pivoted on the development of high-tech long-cycle and capital-intensive businesses strengthened

the leading edge of its core businesses in display and new energy photovoltaics. Under the backdrop

of a complex operating environment the Company cemented its foundation enhanced risk

management capabilities pursued extreme cost efficiency and drove development through

technology innovation. In 2023 the Company achieved a revenue of RMB174.367 billion up 4.69%

year on year; net profits of RMB4.781 billion up 167.37% year on year; net profit attributable to

shareholders of the listed company of RMB2.215 billion up 747.60% year on year; and net operating

cash flow of RMB25.315 billion.During the Reporting Period the sales of display at user-end market remained sluggish. On the

supply side the industry structure continued to optimize competition tended to be benign and the

prices of major products rebounded amid stabilization. The Company's display business kept

optimizing business strategies and continued to implement the high-end strategy with a stable

growth in the market share of major products. TCL CSOT remained top 2nd globally by its market

share of TV products while its market share of e-sports monitors and LTPS tablet products ranked

first globally. The t9 production line positioned at mid-sized IT and vehicle-mounted display

products started serial production and shipments and the proportion of OLED high-end product

shipments rose quickly. During the Reporting Period the display business achieved a revenue of

RMB83.655 billion with a year-on-year increase of 27.26% and a net profit of negative RMB7

million with a year-on-year improvement of RMB7.618 billion among which a net profit of

RMB3.441 billion was recorded in the second half of 2023 indicating steadily improving profitability.

2Full Text of the Annual Report 2023 of TCL Technology Group Corporation

In 2023 the global new energy photovoltaic industry and corporate development embarked on

a new pattern. Affected by the capacity centrally released alongside the industrial chain the supply

and demand was unbalanced with significant decline of product prices and some low-efficient

capacity faced the pressure of elimination. Overall the industry structure was expected to be

optimized. During the Reporting Period TZE recorded a revenue of RMB59.146 billion down by

11.74% year on year. Under the influence of the decreasing product price loss from investees

provision for impairment loss and other factors TZE reported a year-on-year decrease of 44.88% in

net profit to RMB3.899 billion throughout the year. In the face of challenges TZE maintained its

strategic resolve and strengthened its competitiveness. On the one hand it leveraged its differentiated

advantages in G12 N-type silicon wafers shingle components and intelligent manufacturing and

accelerated industry integration through technological innovation so as to pass through industrial

cycles. On the other hand TZE actively evaluated and explored the feasibility on localized

manufacturing (e.g. the United States Europe and the Middle East) in key countries or regions

around the world and promoted the operational improvement of Maxeon to effectively use its

patented technology and unique advantages in overseas markets with entry barriers. TZE continued

to facilitate its efforts to develop photovoltaic business and localized manufacturing on the

international arena seized the global opportunities for the development of the new energy industry

and achieved a sustainable growth.During the Reporting Period the Company sustained robust operations and made steady

progress in other business segments.The Company has always emphasized research and development (R&D) investments in cutting-

edge technologies and commercial application with a focus on innovation to drive business

transformation and upgrading. During the Reporting Period the Company invested RMB10.309

billion in R&D accounted for 5.91% of the Company's revenue. In 2023 the Company filed 590 new

PCT applications in total of 15331 applications applied. Notably the Company ranked second

globally in terms of patent applications in the field of quantum dot displays. Furthermore through

continuous technological innovation process advancements and a strategic shift towards Industry

4.0 manufacturing TZE has built its unique competitive edges in large-size thin-film and N-type

silicon wafers. To implement the technology ecosystem strategy the Company has proactively

marshaled resources made a breakthrough in key technologies and industrial production. This robust

3Full Text of the Annual Report 2023 of TCL Technology Group Corporation

technology ecosystem serves as a cornerstone for the Company's continued technological

development.Looking ahead with intensive integration of several promising techonologies we will anticipate

a surge of novel display applications and immersive scenarios which will propel the growing

demands in display industry. The inter-country transfer of LCD industry has gradually drawn to an

end and the competitive landscape tends to stabilize. Companies are transitioning from a scale-driven

growth model to a high-quality development stage fueled by technological innovation product

upgrading and an eco-system layout. The Company's display business aims at becoming a "world-

leading provider of display solutions". To achieve this we are implementing a comprehensive

strategy that optimizes our business and product structure strengthens our operational foundation

enhances operational excellence differentiates our values and drives continuous improvement in

operational efficiency.As climate change and energy issues escalate into pressing global challenges there's a growing

consensus on the urgent need to accelerate the green and low-carbon transformation of the energy

sector. The photovoltaic industry will remain at the bottom of the market cycle in the near to medium

term featuring severely unbalanced supply and demand acceleration of product and technology

transformation and elimination of outdated production capacity driven by the Matthew effect. Taking

"ranking No.1 in global silicon wafer market share and achieving comprehensive global leadership"

as the strategic vision the Company's new energy photovoltaic business sticks to technological

innovation expands the leading edge in advanced production capabilities strategically strengthens a

layout across the photovoltaic industry chain and capacity building worldwide so as to go through

the cycle by relative competitiveness and achieve a sustainable growth.As a crucial pillar of the national economy the manufacturing sector plays a key role in driving

economic transformation and development. Technological manufacturing is especially vital for

fostering economic transformation and upgrading and nurturing new engines of growth. The

Company remains focused on its core businesses in displays and new energy photovoltaics

unwavering in its pursuit of global leadership. With the courage of "venturing midstream and striving

to win" embracing a culture of "relentless perseverance and decisive action" the Company guides

its business units to solidify their competitive edges ensuring steady progress and positioning the

Company for long-term sustainable growth.

4Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Committed to creating value for shareholders the Company has a long-standing tradition of

maintaining a prudent dividend policy. Following this commitment the Board of Directors proposes

a dividend of RMB0.80 per 10 shares for 2023 sharing the Company's growth success with all

shareholders.I would like to express my sincere gratitude for the trust of all our shareholders for the support

from all our partners and users as well as for the efforts of all employees!

April 28 2024

5Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Part I Important Notes Table of Contents and Definitions

The Board of Directors (or the "Board") the Supervisory Committee as well as the directors

supervisors and senior management of TCL Technology Group Corporation (hereinafter referred to

as the "Company") hereby guarantee the factuality accuracy and completeness of the contents of this

Report and its summary and shall be jointly and severally liable for any misrepresentations

misleading statements or material omissions therein.Mr. Li Dongsheng the Chairman of the Board Ms. Li Jian the person-in-charge of financial

affairs (Chief Financial Officer) and Ms. Jing Chunmei the person-in-charge of the financial

department hereby guarantee that the financial statements carried in this Report are factual accurate

and complete.All the Company's directors attended the Board meeting for the review of this Report and its

summary.The future plans development strategies or other forward-looking statements mentioned in this

Report and its summary shall NOT be considered as promises of the Company to investors. Therefore

investors are kindly reminded to pay attention to possible investment risks.The profit distribution plan approved by the meeting of the Board of Directors is as follows: For

every 10 shares held shareholders will receive a cash dividend of RMB0.8 (including tax) based on

the total number of outstanding shares of 18779080767(Any repurchased shares held by the

Company upon profit distribution are exclusive of the distribution) without bonus shares or shares

converted from capital reserve.This Report and its summary has been prepared in both Chinese and English. Should there be

any discrepancies or misunderstandings between the two versions the Chinese version shall prevail.

6Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Content

Part I Important Notes Table of Contents and Defin... 6

Part II Corporate Information and Key Financial In.. 10

Part III Management Discussion and Analysis ........ 15

Part IV Corporate Governance ....................... 53

Part V Environmental and Social Responsibility ..... 76

Part VI Significant Events ......................... 85

Part VII Changes in Shares and Information about S. 103

Part VIII Preferred Shares ........................ 112

Part IX Bonds ..................................... 113

Part X Financial Report…………………………………………………………..120

7Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Documents Available for Reference

(I) The financial statements signed and stamped by the person-in-charge of the Company the

Chief Financial Officer and person-in-charge of the financial department.(II) The original of the auditor's report with the seal of the accounting firm and signed and

stamped by CPAs.(III) The originals of all company documents and announcements that were disclosed to the

public during the Reporting Period.

8Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Definitions

Term Refers to Definition

Company the Company the Group Refers to TCL Technology Group Corporation

The "Reporting Period" "current period" Refers to The period from January 1 2023 to December 31 2023.TCL CSOT Refers to TCL China Star Optoelectronics Technology Co. Ltd.TCL Industrial Refers to TCL Industrial Holdings Co. Ltd.TCL Zhonghuan Renewable Energy Technology Co. Ltd. a majority-

TZE Refers to owned subsidiary of the Company listed on the Shenzhen Stock Exchange

(stock code: 002129.SZ)

Shenzhen CSOT Refers to Shenzhen China Star Optoelectronics Bandaoti Display Technology Co. Ltd.Wuhan CSOT Refers to Wuhan China Star Optoelectronics Technology Co. Ltd.Wuhan China Star Optoelectronics Refers to Wuhan China Star Optoelectronics Bandaoti Display Technology Co. Ltd.Bandaoti

Guangzhou CSOT Refers to Guangzhou China Star Optoelectronics Bandaoti Display Technology Co. Ltd.Suzhou CSOT Refers to Suzhou China Star Optoelectronics Technology Co. Ltd.Moka Technology Refers to Moka International Limited

t1 Refers to The generation 8.5 (or G8.5) TFT-LCD production line of TCL CSOT

t2 Refers to The generation 8.5 (or G8.5) TFT-LCD production line of TCL CSOT

t3 Refers to The generation 6 (or G6) LTPS-LCD panel production line at Wuhan CSOT

t4 Refers to The generation 6 (or G6) flexible LTPS-AMOLED panel production line at Wuhan CSOT

Wuhan t3 production expansion project Refers to The generation 6 (or G6) of new display production line of Wuhan CSOT

t6 Refers to The generation 11 (or G11) new TFT-LCD display production line at Shenzhen CSOT

t7 Refers to The generation 11 (or G11) new ultra high definition display production line at Shenzhen CSOT

t9 Refers to The generation 8.6 (or G8.6) new oxide display production line at Guangzhou CSOT

t10 Refers to The generation 8.5 (or G8.5) TFT-LCD production line at Suzhou CSOT

GW Refers to Gigawatt power unit for solar cells 1GW = 1000 megawatts

12-inch ultra-large DW-cut solar monocrystalline silicon square wafer

G12 Refers to size: 44096mm2 diagonal line: 295mm side length: 210mm with its size

80.5% larger than the conventional M2

RMB Refers to Renminbi

9Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Part II Corporate Information and Key Financial Information

I. Corporate Information

Stock name TCL TECH. Stock code 000100

Stock abbreviation before change (if any) -

Place of listing Shenzhen Stock Exchange

Company name in Chinese TCL 科技集团股份有限公司

Abbr. TCL 科技

Company name in English (if any) TCL Technology Group Corporation

Abbr. in English (if any) TCL TECH.Legal representative Li Dongsheng

Place of registration TCL TECH. Building 17 Huifeng Third Road Zhongkai Hi-Tech Development District Huizhou City Guangdong Province

Zip code 516001

History of changes in the Company's place of

registration -

Office address TCL TECH. Building 17 Huifeng Third Road Zhongkai Hi-Tech Development District Huizhou City Guangdong Province

Zip code 516001

Company website https://www.tcltech.com/

Email address ir@tcl.com

II. Contact Information

Board Secretary

Name Liao Qian

Office address 10/F Tower G1 International E Town TCL Science Park 1001 Nanshan District Shenzhen Guangdong Province China

Tel. 0755-33311666

Email address ir@tcl.com

III. Media for Information Disclosure and Place Where This Report is Lodged

Stock exchange website for publication of this Report Shenzhen Stock Exchange http://www.szse.cn

Securities Times China Securities Journal Shanghai Securities News

Media name and website for publication of this Report Securities Daily as well as www.cninfo.com.cn

(http://www.cninfo.com.cn)

Place where this Report is lodged Capital Market Department of TCL Technology Group Corporation

IV. Changes to Company Registered Information

Unified Social Credit Code 91441300195971850Y

1. In 2019 the Company focused on display devices by sold smart

Changes in main business activities of the Company terminal businesses such as consumer electronics and household

since going public appliances and related supporting businesses. 2. In 2020 the Company acquired 100% equity of Tianjin Zhonghuan

Electronic through public delisting shaping a business structure that

10Full Text of the Annual Report 2023 of TCL Technology Group Corporation

focused on display and new energy photovoltaic.Changes of controlling shareholder since incorporation Not applicable

V. Other information

The independent audit firm hired by the Company:

Name Da Hua Certified Public Accountants (Special General Partnership)

Office address Room 1101 Building 7 No. 16 Xi Si Huan Zhong Road Haidian District Beijing

Name of signing accountants Jiang Xianmin and Xiong Xin

The independent sponsor hired by the Company to exercise constant supervision over the Company in the Reporting Period

? Applicable □ Not applicable

Name Office address Representative Period of supervision

Shenwan Hongyuan 19 Taipingqiao Avenue Xicheng The period from December

Financing Services Co. Ltd. District Beijing Ren Cheng and Mo Kai 22 2022 to December 31 2023.The independent financial advisor hired by the Company to exercise constant supervision over the Company in the Reporting Period:

□ Applicable ?Not Applicable

VI. Key Accounting Data and Financial Indicators

Indicate whether there is any retrospectively adjusted or restated datum in the table below

? Yes □ No

2023-

2022 Over-2022 2021

2023 Change

Before After Before

After adjustment After adjustment

adjustment adjustment adjustment

Revenue (RMB) 174366657015 166552785829 166552785829 4.69% 163540559623 163657700477

Net profit

attributable to

the company's 2214935302 261319451 261319451 747.60% 10057443528 10064253118

shareholders

(RMB)

Net profits

attributable to

the company's

shareholders 1021080065 -2698210800 -2698210800 137.84% 9437240976 9444050566

after non-

recurring gains

and losses

(RMB)

Net cash

generated from 25314756105 18426376609 18426376609 37.38% 32878450437 32878450437

operating

activities (RMB)

Basic earnings

per share 0.1195 0.0191 0.0174 586.78% 0.7463 0.6789

(RMB/share)

11Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Diluted earnings

per share 0.1179 0.0185 0.0168 601.79% 0.7354 0.6690

(RMB/share)

Increase by

Weighted 3.76

average return 4.27 0.52 0.52 percentage 26.46 26.48

on equity (%) points

YoY

The end of 2022 Change The end of 2021

The end of 2023 Before After Before

After adjustment After adjustment

adjustment adjustment adjustment

Total assets 382859086727 359996232668 359996232668 6.35% 308733133305 308749696062

(RMB)

Owners' equity

attributable to

the company's 52921867086 50678520477 50678520477 4.43% 43034234611 43041044200

shareholders

(RMB)

Reason for retrospective adjustment or restatement:

1. Shares were converted from capital reserve during the Reporting Period. The Company recalculated the basic earnings per share and

diluted earnings per share in accordance with accounting standards and other regulations.

2. In accordance with the requirements of the Interpretations of Accounting Standards for Business Enterprises No. 15 Interpretations

of Accounting Standards for Business Enterprises No. 16 and Explanatory Announcement No. 1 on Information Disclosure for

Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss (Revised in 2023) the Company has implemented the

relevant provisions. These adjustments have no material impact on the Company's financial position and operating results.The net profit before or after the deduction of non-recurring gains and losses in the latest three accounting years whichever is lower

is negative and the audit report of the latest year shows the company's ability to continue as a going concern

□Yes ?No

The net profit before or after the deduction of non-recurring gains and losses whichever is lower is negative

□Yes ?No

VII. Accounting Data Differences under China's Accounting Standards for Business

Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign

Accounting Standards

1. Differences in Net Profit and Equity under CAS and IFRS

□ Applicable ?Not Applicable

There is no difference in net profit and net assets between the financial statements prepared in accordance with International Accounting

Standards (IAS) and Chinese Accounting Standards (CAS) for the Reporting Period of the Company.

12Full Text of the Annual Report 2023 of TCL Technology Group Corporation

2. Differences in Net Profit and Equity under CAS and Foreign Accounting Standards

□ Applicable ?Not Applicable

There is no difference in net profit and net assets between the financial statements prepared in accordance with foreign accounting

standards and Chinese Accounting Standards (CAS) for the Reporting Period of the Company.

3. Reasons for Accounting Data Differences Above

□ Applicable ?Not Applicable

VIII. Major Financial Indicators by Quarter

Unit: RMB

Q1 Q2 Q3 Q4

Revenue 39443242439 45705483167 47960309079 41257622330

Net profit attributable to the

company's shareholders -548999154 889492743 1270918405 603523308

Net profits attributable to the

company's shareholders after non- -729931586 129864746 1107560913 513585992

recurring gains and losses

Net cash generated from operating

activities 4495356538 5920811609 5727844866 9170743092

Indicate whether any of the quarterly financial data in the table above or their summations differs materially from what has been

disclosed in the Company's quarterly or interim reports.□Yes ?No

IX. Non-Recurring Gains and Losses

? Applicable □ Not applicable

Unit: RMB

Item 2023 2022 2021

Gains and losses on disposal of non-current assets (inclusive of impairment

allowance write-offs) 275255225 1757838745 -184525551

Public subsidies charged to current profits and loss (except for public subsidies

which are closely related to the Company's daily operations comply with

national policies are granted based on determined standards and have a 2764042905 1322782937 699270673

continuous impact on the Company's profits or losses)

Gains and losses on change in fair value of financial assets and financial

liabilities held by the non-financial companies other than those valid hedging

activities related to the normal operating business as well as gains and losses -114258710 -127233837 238629291

from the disposal of financial assets and financial liabilities

Reversal of provision for impairment of receivables that have been individually

tested for impairment 22894255 37745528 -

Gain equal to the amount by which investment costs for the Company to obtain

subsidiaries associates and joint ventures are lower than the Company's

enjoyable fair value of identifiable net assets of investees when making - - 40299579

investments

Non-operating income and expenses other than the above 228994235 758599650 275789900

Less: Corporate income tax 603197886 244386076 93176105

13Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Non-controlling interests (net of tax) 1379874787 545816696 356085235

Total 1193855237 2959530251 620202552

Details of other profit and loss items that meet the definition of non-recurring profits and losses:

□ Applicable ?Not Applicable

The Company has no other profit and loss items that meet the definition of non-recurring profits and losses.Notes on non-recurring profit and loss items that which is listed in the Explanatory Announcement No. 1 on Information Disclosure

for Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss shall be used to define Recurring Gain/Loss items

□ Applicable ?Not Applicable

The Company does not have any non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on Information

Disclosure for Companies Offering Their Securities to the Public—Non-Recurring Gain/Loss that are defined as recurring profit and

loss items.

14Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Part III Management Discussion and Analysis

I. Company-related Industry Outlook During the Reporting Period

In 2023 the international political and economic situation was complex and volatile with

ongoing geopolitical conflicts. The global industrial supply chain faced a restructuring further

exacerbating economic fragmentation. Meanwhile some economies implemented tight monetary

policy which further slowed down global economy. In response to the complicated and ever-

changing challenges the Company continued to focus on the development of display business and

new energy photovoltaic business enhance the resilience of its business and optimize its competitive

edge in pursuit of high-quality sustainable development. In 2023 TCL TECH. achieved a revenue of

RMB174.367 billion up 4.69% year-on-year; net profit of RMB4.781 billion up 167.37% year-on-

year; net profit attributable to shareholders of the listed company of RMB2.215 billion up 747.60%

year-on-year; and a net operating cash flow of RMB25.315 billion.Major factors that influenced the Company's performance included: the positive turnaround of

the supply-demand relationship in the display industry the steady price appreciation of mainstream

products the Company's proactive optimization of business strategies improving business structure

and significantly improved profitability. During the Reporting Period the display business achieved

a revenue of RMB83.655 billion with a year-on-year increase of 27.26% and a net profit of negative

RMB7 million with a year-on-year reducing loss of RMB7.618 billion. The display business turned

losses into profits in Q3 2023 and continued to achieve strong profitability in Q4 2023 which resulted

in a total profit of RMB3.441 billion for H2 2023. Fueled by China's "Dual Carbon" strategy demand

in the new energy photovoltaic industry maintained growth. However industry-wide supply-demand

imbalances led to a decline in product pricing. Furthermore the TZE's performance was impacted by

the investee Maxeon such as investment losses associated with the Maxeon as well as long-term

equity investments and financial assets recognized as asset impairment loss and negative fair value

change respectively. As a result TZE reported a revenue of RMB59.146 billion for the Reporting

Period down 11.74% year-on-year; a net profit of RMB3.899 billion reflecting a year-on-year

decline of 44.88%.Leveraging technological innovation as a primary driver the Company is poised for

15Full Text of the Annual Report 2023 of TCL Technology Group Corporation

building a robust portfolio of proprietary and cutting-edge technologies to ensure sustained

industry leadership and drive continuous industrial upgrading. During the Reporting Period the

Company invested RMB10.309 billion in R&D and filed 590 new PCT applications for a total of

15331 applications applied. The Company's display business strategically amplified R&D

investments in ultra-large-sized ultra-high-resolution high refresh rate and flexible display

technologies. Establishing new-type display technology and application innovation as its core

competitivenesses the Company strove toward the high-end of the value chain. The Company's new

energy photovoltaic business focused on groundbreaking innovation in solar cell technology with

independently developed intellectual property rights and led the industry transition towards

significantly improved energy conversion efficiency through its long-term technological

accumulation ultimately securing high-quality development.The Company ensured a steady and sustainable market position by fortifying core

competencies and establishing a robust operational foundation as well as optimizing

production capacity and product structure. In conjunction with stable competition structure in the

display industry leading manufacturers posses an advantage in terms of economies of scale. During

the Reporting Period the Company strategically realigned its production capacity and product

structure on the basis of incremental markets and continuously increased its market share with its

TV panel shipments ranking No. 2 globally MNT panel shipments jumping to No. 3 globally and

flexible OLED shipments experiencing growth in leaps and bounds. At the end of the Reporting

Period the Company's photovoltaic materials business significantly expanded its crystal wafer

production capacity to 183GW capturing a 23.4% market share of the global market. The company

accounted for 60% of the large-sized (210 series) wafer external sales market 65% of the overseas

wafer external sale market and 36.4% of the N-type wafer segment maintained No.1 in photovoltaic

wafer external sales market share and further consolidated the Company's leadership within the

industry.The Company implemented a strategic approach focused on fortifying its core

competencies and rectifying shortcomings to bolster the competitive advantage of its core

business segments and increase both efficiency and effectiveness. The Company's display

business capitalized on the technological capabilities of its high-gen production lines to actively drive

the development of larger-sized higher-specification display products and to grasp the iterative

16Full Text of the Annual Report 2023 of TCL Technology Group Corporation

demand for IT products fueled by the IT revolution to fill the gap in its mid-sized production capacity

(e.g. the t9 production line) and product layout. To enhance its operational efficiency the small-sized

OLED business has implemented a high-end differentiated product strategy. Relying on its

advantages in leading G12 and N-type wafer technology Industry 4.0 and flexible manufacturing

processes the Company's new energy photovoltaic business played a synergistic role across the entire

photovoltaic value chain and ultimately shored up the relative advantages in cost efficiency.Promoting globalization strategy the Company transitioned from product export to

industry capacity export building a global industrial ecosystem. The Company's display business

improved its layout in its panel module plant in India and overseas business platform to strengthen

its capacity to serve global customers and partners and satisfy the incremental needs of emerging

markets worldwide. Due to the increasing complexity of the global economic and political landscape

the Company's new energy photovoltaic business prudently and steadfastly implemented its

globalization strategy where it actively evaluated and explored potential industrial projects in key

global markets such as the United States Europe and the Middle East. Various projects were rolled

out such as comprehensive project planning strategic partner negotiation and thorough feasibility

studies. Concurrently the business collaborated with strategic partners to expand its photovoltaic cell

and module business in Malaysia the Philippines and other regions further cementing its global

competitiveness within the new energy photovoltaic sector.II. Main Businesses of the Company During the Reporting Period

The Company focused on the development of the core business of displays and new energy

photovoltaics and other silicon materials and was committed to achieving the strategic goal of global

leadership.TCL TECH.Display New energy photovoltaics Industrial finance and and other silicon materials investment Others

Moka Zhonghuan Zhonghuan TCL

TCL CSOT Highly Technology Photovoltaic Advanced Finance TCL Capital TPC

Juhua China Ray

17Full Text of the Annual Report 2023 of TCL Technology Group Corporation

(I) Display business

In 2023 the user-end demand for displays products remained sluggish globally and it showed

seasonal fluctuation. However the trend towards larger TV panels drove display area demand while

a just-in-time (“JIT”) production strategy bacame a consensus among major enterprises fostering

healthy industry development amid an increasingly favorable competitive landscape. Large-sized

panel prices exhibited a seasonal pattern with significant peak-season recovery and a slight decline

in the off-season while mid-sized panel prices stabilized at low levels and small-sized panels

experienced structural price increases in the second half of the year.By leveraging its strengths in terms of scale and efficiency TCL CSOT has consistently

optimized its business and product mix insisted on JIT production and accelerated their business

cycle. This coupled with favorable price increases for key products has significantly boosted

operating performance. During the Reporting Period the display business achieved a revenue of

RMB83.655 billion with a year-on-year increase of 27.26% and a net profit of negative RMB7

million with a year-on-year reducing loss of RMB7.618 billion while recorded a profit of

RMB3.441 billion in H2 2023. The display business achieved a net cash flow from operating

activities of RMB20.12 billion.In its large-sized products business TCL CSOT leveraged its advantages in terms of high-

gen production lines and synergy with the industry chain and led the upgrading and high-end

development of large-sized TV panels while actively developing commercial displays such as

interactive whiteboards digital signage and splicing screens. Capitalizing on the manufacturing

efficiency and process advantages of its G8.5 and G11 high-gen production lines TCL CSOT

collaborated with strategic customers to enhance the penetration of large-sized TVs in the market and

elevate the value of key segments alongside the industry chain. The Company consolidated its No. 2

position in terms of global market share of TV panels. 79% of the shipment area for products above

55 inches 51% of the shipment area for products above 65 inches; while 55-inch and 75-inch products

ranked No. 1 in the world the market share of 65-inch products ranked No. 2 globally. In commercial

markets such as interactive whiteboards digital signage and splicing screens the Company ranked

among the top three in terms of global market share.In its medium-sized product business TCL CSOT accelerated its capacity construction in

IT and vehicle-mounted screen products while optimizing and enhancing product competitiveness

18Full Text of the Annual Report 2023 of TCL Technology Group Corporation

and optimizing customer structure to create a new engine for business growth. Dedicated to mid-sized

displays for IT vehicle-mounted devices and other business the t9 production line (phase I) is now

running at full capacity propelling the Company to being ranked third globally in terms of display

shipments. In this segment the Company occupies the largest share in the global e-sports monitors

market while its laptop and vehicle-mounted devices are on track for branded customer introductions

and gradual production increases. With the steady increase in 6th-gen LTPS capacity the Company

ranks No. 2 in LTPS laptop panels globally and No. 1 in LTPS tablets globally; and vehicle-mounted

LTPS displays rank fifth worldwide. TCL CSOT's mid-sized business increased to 21% of its revenue

making it a key driver of future growth.In the small-sized display segment TCL CSOT is targeting the mid-to-high-end market

with a portfolio of LTPS and flexible OLED production lines driving continuous improvements

in product competitiveness and market share. TCL CSOT ranked No. 3 in the world in terms of

LTPS mobile panel shipments from the t3 production line. The independently developed 1512 PPI

Mini-led LCD-VR screens achieved start of production (SoP) and shipment. The Company's t4

flexible OLED production line has experienced a significant ramp-up in both utilization rate and

shipments. This operational excellence secured the Company's position as the fourth-largest supplier

of flexible OLED smartphone panels globally in Q4 2023. Product and customer mix have undergone

structural optimization evidenced by the introduction of several brand customers during the

Reporting Period. The Company's leadership in flexible OLED technologies extends to foldable

LTPO and Pol-Less displays driving a continuous increase in the share of high-end products within

its portfolio. During the Reporting Period the flexible OLED business segment achieved a two-fold

growth in revenue reflecting a sustained improvement in operational performance.Looking ahead into the future as major information carriers and interactive interfaces in the

digital economy era display industry will endure industrial value in the long run and are expected to

unleash more value.In the large-sized and mid-sized segments display technology has entered a period of slow

iteration while LCD technology will remain the mainstream technology in the long term. In recent

years global TV sales have remained stable. Fueled by the size increase of large-sized screens

display area has maintained stable growth and industry cycle fluctuations have reduced. The supply-

side industry has become further concentrated and increasingly optimized competition will drive the

19Full Text of the Annual Report 2023 of TCL Technology Group Corporation

balanced development of industrial supply and demand. Corporate profitability will recover with

reasonable business returns under favorable circumstances. Driven by product specification upgrades

such as high refresh rates and lower energy consumption IT panels are poised for significant

structural growth. Capitalizing on this trend the company’s 8th-gen production lines specialized for

IT products will leverage their cutting-edge capabilities to gradually become the main force in key

markets.Flexible OLED has firmly established its dominance in the smartphone market and gradually

penetrated into new application scenarios. Foldable OLED displays are poised for a new growth

frontier fueled by rapidly unleashed demand. In the meantime there exist certain factors that pose

challenges to current capacity manufacturing and other aspects such as capacity loss resulting from

new technologies and the yield ramp-up of new products which will further improve industry supply

and demand relationships.TCL CSOT as a global leader in large-sized display panels will continuously enhance its

relative competitiveness and profitability; it will improve its medium-sized products portfolio

leverage the advantages of its high-generation production lines seize the opportunities in incremental

markets for high-specification products and increase market share and revenue scale; TCL CSOT

will optimize its small-sized products and customer structure drive the high-end development of

products through technological innovation achieve business improvement in flexible OLED and

accelerate the transformation and upgrading from a large-sized display leader to leader across the full

size of displays.(II) New energy photovoltaics and other silicon materials business

In response to such challenges as climate change energy security and environmental pollution

the global energy industry is experiencing a rapid shift towards a more sustainable model which

drives the fast-growing new energy photovoltaic industry. In 2023 the global installed capacity

surged by 72% year-on-year to 395GW of which China accounted for approximately 216.9GW

while overseas markets contributed the remaining 178GW. The photovoltaic industry's compelling

sustained growth prospects have spurred a wave of investment from both established players and new

entrants. The influx of capital has accelerated capacity expansion across the photovoltaic industrial

chain leading to a product price downturn in major links while squeezing the profit margin of the

industry as a whole.

20Full Text of the Annual Report 2023 of TCL Technology Group Corporation

In line with prudent accounting practices the Company recognized long-term equity investments

and financial assets in connection with the investee Maxeon as asset impairment losses and negative

fair value change respectively. These factors along with investment recognized under the equity

method on a consolidated basis contributed to a negative impact on TZE's fourth-quarter

performance. During the Reporting Period TZE achieved a revenue of RMB59.146 billion with a

year-on-year decrease of 11.74% and a net profit of RMB3.899 billion with a year-on-year decrease

of 44.88%. In the photovoltaic materials business year-on-year shipment volume surged by 68% to

114GW capturing a leading market share of 23.4% for silicon wafers and generating RMB43.791

billion in revenue. The comprehensive gross profit margin for this business also witnessed a

significant improvement of 2.8 percentage points year-on-year to 21.8%; year-on-year shipment

volume for photovoltaic cells and modules grew by 29.8% year-on-year to 8.6GW generating

RMB9.309 billion in revenue.With an imbalance between demand and supply throughout the industrial chain competition is

evident within the industry from the lowest levelized cost of energy (LCOE) for photovoltaic modules

to product (efficiency/power output) on the basis of integrated internal rate of return (IRR) and land-

based balance-of-system (BOS) costs. Those products with higher energy conversion efficiency will

become the mainstream in the industry. TZE prioritizes technological innovation securing a

leading position in G12 and N-type photovoltaic materials technology. Through continuous cost

reduction and efficiency optimization the Company is actively strengthening its comparative

competitiveness. At the end of the Reporting Period with comparative competitiveness created by

technical innovation and lean manufacturing the Company led the upgrade of large-sized wafer

thinfilm process technologies for crystals and wafers. Metrics such as the consumption rate of silicone

materials per crystalline unit monthly crystal output per furnace and wafer output quantities per kg

are at the forefront of the industry and factor into the Company's ability to navigate industry chain

fluctuations through sustainable technology and cost leadership. Leveraging its technological

expertise in N-type material products and its flexible manufacturing capabilities aligned with the

demands for the "multi-product multi-customer multi-process" in the N-type era the Company is

accelerating its transition to N-type materials and shingled modules. With the world's No. 1 external

sales market share in N-type silicon wafer and a cost lower than the second-best cost in the industry

21Full Text of the Annual Report 2023 of TCL Technology Group Corporation

at around RMB0.03/W the Company is establishing a differentiated competitive edge in the industry

chain for next-gen technologies.With the pursuit of autonomous and controllable energy by countries worldwide coupled with

the increasing localization of photovoltaic manufacturing and the reduction of international trade

there is a resulting degree of uncertainty in business operations. However also present are novel

strategic opportunities for enterprises with the capacity to expand into overseas markets. TZE

strengthened its Industry 4.0 intelligent manufacturing capabilities continued to impel its

global presence developing industrial projects in key countries or regions around the world.Reliant upon its long-term investment and accumulation in intelligent manufacturing the Company

has secured industry-leading levels of automation and labor productivity resulting in a competitive

advantage in localized manufacturing on a global scale. During the Reporting Period the Company

actively evaluated and pursued industrial expansion projects in key global markets including the

United States Europe and the Middle East. This included ongoing project planning communication

and negotiation with potential partners and research into project implementation. The Company also

prudently recognized an impairment loss on its investment in Maxeon a company significantly

impacted by a confluence of factors in its core markets including a rapid decline in photovoltaic

product prices adjustments to photovoltaic subsidy policies and a high interest rate. The Company

is actively driving operational excellence initiatives at Maxeon with an aim to fully capitalize on

Maxeon's unique competitive advantages in its core markets and its proven technological innovation

capabilities. By fostering a collaborative ecosystem between global production and distribution

channels the Company seeks to strengthen its competitive edge in the global marketplace.Looking ahead into 2024 we anticipate further optimization of the industry structure along with

sustained growth in user-end market demand for display area which suggests a favorable industry

outlook leading to enhanced operating performance within the Company's display business. While

the photovoltaic industry remains at the bottom of the cycle the Company's new energy photovoltaic

business is taking a proactive stance. By strengthening its operational resilience the Company aims

to navigate through the industry cycles with a competitive edge. By upholding the spirit of "Venturing

Midstream and Striving to Win" the Company will firmly grasp the opportunities brought by

transformations in the technology manufacturing industry and the global energy structure and

continue to implement the business strategies of "improving operational quality and efficiency

22Full Text of the Annual Report 2023 of TCL Technology Group Corporation

enhancing strengths to shore up weaknesses innovation-driven development as well as accelerating

global expansion" in order to achieve sustainable high-quality development and take on a leading

role in the global market.III. Analysis of Core Competitiveness

Since its inception in 1981 TCL has embarked on a remarkable journey spanning 42 years

marked by a series of extraordinary achievements. Navigating industry cycles with resilience TCL

has become a leading technology manufacturing conglomerate in China. Among the numerous

enterprises that have emerged since China implemented its reform and opening-up policy TCL is one

of a select few large corporations that have retained its vibrancy and vigor for nearly half a century.In 2018 TCL introduced the most significant transformation in its corporate history

strategically restructuring from a diversified to a specialized business model which entailed a clear

focus on the development of high-tech capital-intensive and long-cycle technology industries. In

line with China's strategy of transformation from a manufacturer of quantity to one of quality the

Company is committed to becoming a leading global technology conglomerate. To achieve this it

has divested its terminal business and non-core businesses and shifted its focus to industrial

upgrading and strategic expansion in upstream high-tech industries. In 2020 the Company officially

changed its name to "TCL TECH." delisting Zhonghuan Electronic in July 2020 which facilitated

the Company's entry into the new energy photovoltaic and silicon materials sectors. In August 2020

the acquisition of Suzhou Samsung solidified TCL TECH.'s position and competitive edge within the

display industry.As it stands leveraging its strengths in independent innovation and self-driven development the

Company has established a business structure centered on two core industries: displays and new

energy photovoltaics. With a well-defined development roadmap efficient operations and a

distinctive corporate culture the Company has established itself as a global leader in its core

industries and is well-poised for building its core competitiveness and sustainable development

capabilities.Scale leadership: Transforming from a leader in large-sized displays to a full-size layout

As a leader in the global display industry and a trailblazer in domestic display line construction

the Company leverages its strategic "Twin Star" production line layout to maximize synergies with a

focus on both endogenous growth and epitaxial mergers and acquisitions enabling the Company to

23Full Text of the Annual Report 2023 of TCL Technology Group Corporation

continuously expand its production capacity. With a global footprint spanning nine high-gen

production lines and five module plants the Company serves a diverse customer base across major

markets. In 2023 TCL CSOT ranked No. 2 globally in TV panel shipments securing the No. 1

ranking in terms of both 55-inch and 75-inch TV panels. The Company is also accelerating its full-

size strategy by investing in the t9 production line which is geared towards high-value-added IT and

commercial display products in medium-sized products segment. In 2023 TCL CSOT ranked No. 2

in the LTPS notebook market and No. 1 in the tablet market by market share; it ranked No. 3 in the

global MNT display market where it ranked No. 1 in the e-sports MNT segment. TCL CSOT reported

a significant surge in flexible OLED shipments during Q4 2023. During 2023 TCL CSOT also

actively enhanced its value chain structure increased module capacity and further elevated its

position along the value chain and in terms of profitability. TCL CSOT has passed through several

industry cycles transforming from a follower to a peer and then to a front-runner which is not merely

a testament to its continuously high-quality growth in scale but also to its unwavering strategy to

technological innovation and ecosystem development in the display sector.Leading management: TCL CSOT aims to be a global leader in efficiency and traverse

various cycles by comparative competitiveness

While establishing its leadership in market scale technology and ecosystem development TCL

CSOT has consistently maintained industry-leading efficiency and profitability metrics. Since its

inception in 2011 TCL CSOT has successfully navigated two significant cycles in the display

industry thanks to two critical contributors - extreme cost efficiency and lean management.TCL CSOT leverages the synergy of its twin factories to optimize production line planning

maximize capacity expansion implement end-to-end cost and expense control through lean

management and extreme efficiency cost measures establishing its competitiveness in the industry.TCL CSOT's proven risk mitigation capabilities honed through multiple industry cycle fluctuations

will continue to propel the company's leadership position and steer its growth trajectory in the future.Strategic new frontier: Cultivating a thriving second growth curve with new energy

On the basis of enterprise development and national planning for strategic emerging industries

the Company actively seeks new development pathways that are technology-intensive and capital-

intensive with a long development cycle so as to strengthen and fully utilize TCL's core

competitiveness. In July 2020 the Company successfully acquired the Zhonghuan hybrid-ownership

24Full Text of the Annual Report 2023 of TCL Technology Group Corporation

reform project. TZE aligns perfectly with TCL's quest for new growth drivers specializing in the

research and development of new energy photovoltaics and other silicon materials.Since 2021 TZE has unlocked growth potential and accelerated business development through

institutional reform optimizing capital structure and enhancing organizational vitality.Leading in technology and ecology: Actively laying the groundwork for pan-display

technologies building a first-mover advantage through ecological leadership

Relying on TCL CSOT and TZE the Company has accelerated its vertical layout of the

industrial chain and continuously improved its upstream capacity for technological innovation. The

Company has strategically focused on building an ecosystem in areas such as basic materials next-

gen display materials photovoltaic materials and critical equipment for new manufacturing processes.This is aimed at creating an ecosystem within the display market to establish a leading advantage

based on next-gen display technology.TCL TECH. boasts a global network of 32 R&D centers serving as the only "National Printing

and Flexible Display Innovation Center" appointed by the Ministry of Industry and Information

Technology and the sole "National New Display Technology Innovation Center" designated by the

Ministry of Science and Technology with 9 national-level enterprise open innovation platforms and

33 provincial-level innovation platforms having obtained related qualifications.

Organizational and cultural assurance: Building the "Philosophy of Global Leadership"

and strengthening corporate culture

Four decades of unwavering commitment to "Daring Innovation Tenacity Transformation and

Vision" represents TCL's most valuable intangible asset over the last 42 years serves as the

motivation to push boundaries and acts as the continuous driving force behind its ongoing

advancement toward global leadership. At the beginning of 2020 the Company resolutely set forth

the strategic goal of "accelerated growth surpassing competitors and achieving global leadership"

and released the "Philosophy of Global Leadership" to exemplify its corporate culture in its new phase.With this goal as the driving force the Company is committed to reshaping its organizational culture

to one that is characterized by ownership accountability and a performance-driven mindset. TCL

remains dedicated to continuously upgrading exploring and strengthening the core values embodied

by TCL's spirit of "Daring Innovation Tenacity Transformation and Vision". The Company will

further strengthen the development of organizational structure and corporate culture to foster a more

25Full Text of the Annual Report 2023 of TCL Technology Group Corporation

dynamic and agile work environment. By making its "Philosophy of Global Leadership" the

cornerstone of every TCL employee's approach the Company strides towards sustainable growth.IV. Analysis of Core Businesses

1. Overview

See "Part III Management Discussion and Analysis".

2. Revenue and costs

(1) Breakdown of operating revenue

Unit: RMB

20232022

Change (%)

Amount As % of total revenue (%) Amount

As % of total

revenue (%)

Total revenue 174366657015 100% 166552785829 100% 4.69%

By operating division

Display business 83654743374 47.98% 65717154752 39.46% 27.30%

New energy

photovoltaics and

other silicon 59146463193 33.92% 67010157025 40.23% -11.74%

materials business

Distribution

business 30109528571 17.27% 31847803417 19.12% -5.46%

Other and offsets 1455921877 0.83% 1977670635 1.19% -26.38%

By product category

Display devices 83654743374 47.98% 65717154752 39.46% 27.30%

New energy

photovoltaics and

other silicon 59146463193 33.92% 67010157025 40.23% -11.74%

materials

Distribution of

electronics 30109528571 17.27% 31847803417 19.12% -5.46%

Other and offsets 1455921877 0.83% 1977670635 1.19% -26.38%

By operating segment

Mainland China 119940276585 68.79% 119139823459 71.53% 0.67%

Overseas

(including Hong 54426380430 31.21% 47412962370 28.47% 14.79%

Kong)

Distribution mode

Direct sales 149146033585 85.54% 140148331286 84.15% 6.42%

Distribution 24805129036 14.23% 25652437925 15.40% -3.30%

Dealer 415494393 0.24% 752016618 0.45% -44.75%

(2) Operating division product category region or sales mode contributing over 10% of the revenue or operating profit:

? Applicable □ Not applicable

Unit: RMB

Change in Change in

Revenue Operating cost Gross profit Change in margin revenue year- operating cost gross profit year-on-year margin year-

26Full Text of the Annual Report 2023 of TCL Technology Group Corporation

on-year (%) (%) on-year (%)

By operating division

Display business 83654743374 72095222728 13.82% 27.30% 10.66% 12.95%

New energy

photovoltaics

and other silicon 59146463193 47170528471 20.25% -11.74% -13.96% 2.06%

materials

business

Distribution

business 30109528571 28949391997 3.85% -5.46% -5.32% -0.15%

By product category

Display devices 83654743374 72095222728 13.82% 27.30% 10.66% 12.95%

New energy

photovoltaics

and other silicon 59146463193 47170528471 20.25% -11.74% -13.96% 2.06%

materials

Distribution of

electronics 30109528571 28949391997 3.85% -5.46% -5.32% -0.15%

By operating segment

Mainland China 119940276585 103308185800 13.87% 0.67% -4.49% 4.66%

Overseas

(including Hong 54426380430 45459410741 16.48% 14.79% 3.89% 8.77%

Kong)

Distribution mode

Direct sales 149146033585 124301367797 16.66% 6.42% -1.62% 6.81%

Distribution 24805129036 24159455454 2.60% -3.30% -3.24% -0.07%

Dealer 415494393 306773290 26.17% -44.75% -49.39% 6.77%

Core business data in the recent term restated according to the changed methods of measurement that occurred in the Reporting Period

□ Applicable ?Not Applicable

(3) Was revenue from product sales higher than service revenue

? Yes □ No

Operating division Item Unit 2023 2022 Change (%)

Sales 10000 square meters 5304 4275 24.06%

Display Production volume 10000 square meters 5420 4230 28.14%

Inventory 10000 square meters 240 124 93.49%

Sales 10000 sets 1753 1299 34.99%

Modules and finished

machines Production volume 10000 sets 1747 1317 32.67%

Inventory 10000 sets 60 66 -9.76%

Sales 10000 sets 1630718 1064653 53.17%

Photovoltaic silicon

wafers Production volume 10000 sets 1671530 1084730 54.10%

Inventory 10000 sets 72914 32102 127.13%

Other silicon materials Sales Million square inches 737 744 -0.96%

27Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Production volume Million square inches 765 743 2.97%

Inventory Million square inches 53 24 117.48%

Sales 10000 kWh 102019 123105 -17.13%

Energy Production volume 10000 kWh 102019 123105 -17.13%

Inventory 10000 kWh

Sales MW 7144 6607 8.13%

Photovoltaic modules Production volume MW 7911 6619 19.53%

Inventory MW 1407 639 119.95%

Explanation of why any financial indicator in the table above registered a year-on-year change of over 30%

? Applicable □ Not applicable

1. The increase in inventory of display was mainly affected by the release of t9 capacity;

2. The increases in modules and finished machines and output was mainly a result of growth in business scale;

3. Photovoltaic silicon wafer sales increased by 53.17% and production increased by 54.10% compared to the previous year. Inventory

increased by 127.13% compared to the previous year. This is mainly due to the Company's construction projects launching for

production and the continuous improvement of advanced production capacity through technological innovation and Industry 4.0

flexible manufacturing. At the end of the year crystal wafer production capacity reached 183GW an increase of 31% over the

beginning of the year leading to an increase in the turnover of silicon wafer production sales and inventory (solar silicon wafers are

presented as converted to M6 products including photovoltaic silicon rods converted from exported photovoltaic silicon rods);

4. Inventory of other silicon materials increased by 117.48% compared to the previous year mainly due to the increase in product

inventory with the market downturn. In addition as the production and sales of polished wafers and epitaxial wafers have increased

the inventory turnover rate has also increased;

5. Inventory of photovoltaic modules increased by 119.95% compared to the previous year mainly due to the severe overcapacity in

the entire photovoltaic industry chain the dire market conditions and the slowdown in inventory turnover. In addition as the scale of

production and sales has increased the inventory turnover rate has increased.

(4) Execution progress of major sales contracts and materials purchasing contracts signed into during the Reporting Period

□ Applicable ?Not Applicable

(5) Breakdown of operating cost

Operating division

Unit: RMB

20232022

Operating YoY

Item As % of As % of

division Amount Amount Change

total total

28Full Text of the Annual Report 2023 of TCL Technology Group Corporation

revenue revenue

Materials salary

Display business 72095222728 48.46% 65148141621 42.88% 10.66%

depreciation etc.New energy

photovoltaics and

Materials salary

other silicon 47170528471 31.71% 54822913894 36.09% -13.96%

depreciation etc.materials

business

Distribution

Finished goods etc. 28949391997 19.46% 30574483912 20.12% -5.32%

business

Materials salary 552453346 0.37%

Others 1379949553 0.91% -59.97%

depreciation etc.Product category

Unit: RMB

20232022

As % of As % of YoY

Product category Item

Amount total Amount total Change

revenue revenue

Materials salary

Display devices 72095222728 48.46% 65148141621 42.88% 10.66%

depreciation etc.New energy

photovoltaics and Materials salary

4717052847131.71%5482291389436.09%-13.96%

other silicon depreciation etc.materials

Distribution of

Finished goods etc. 28949391997 19.46% 30574483912 20.12% -5.32%

electronics

Materials salary

Others 552453346 0.37% 1379949553 0.91% -59.97%

depreciation etc.

(6) Were there changes in the scope of consolidated financial statements for the Reporting Period

? Yes □ No

Compared with 2022 39 subsidiaries (24 newly incorporated and 15 acquired) are newly included in the consolidation scope of 2023;

and 18 subsidiaries (12 transferred and 6 de-registered) are excluded from the consolidation scope of 2023.

(7) Major changes to the business scope or product or service range in the Reporting Period

□ Applicable ?Not Applicable

(8) Major customers and suppliers

Major customers

29Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Total sales of top five customers (RMB) 51360607561

Total sales of top five customers as % of total sales of the 29.46%

Reporting Period (%)

Total sales of related parties among top five customers as % of 10.09%

total sales of the Reporting Period (%)

Top five customers

No. Customer name Sales revenue (RMB) As % of total sales revenue (%)

1 Customer A 17595352384 10.09%

2 Customer B 11982836772 6.87%

3 Customer C 10005174109 5.74%

4 Customer D 8108202897 4.65%

5 Customer E 3669041400 2.10%

Total -- 51360607561 29.46%

Other information about major customers: For sales transactions between the Company and its related parties see provisional

announcements disclosed by the Company on the designated platform for information disclosure.Major suppliers

Total purchases from top five suppliers (RMB) 28899693549

Total purchases from top five suppliers as % of total purchases

of the Reporting Period (%) 20.75%

Total purchases from related parties among top five suppliers

as % of total purchases of the Reporting Period (%) -

Top five suppliers

No. Supplier name Purchases in the Reporting Period (RMB) As % of total purchases (%)

1 Supplier A 7679043598 5.51%

2 Supplier B 6838857510 4.91%

3 Supplier C 6351627011 4.56%

4 Supplier D 4425255517 3.18%

5 Supplier E 3604909912 2.59%

Total -- 28899693549 20.75%

Other information about major suppliers

□ Applicable ?Not Applicable

3. Expenses

Unit: RMB

2023 2022 Change (%) Main reason for change

Sales

expenses 2523687453 1950527877 29.38%

Administrati

ve expenses 4783246926 3540610990 35.10%

Mainly caused by the growth in business scale

and increases in labor costs

30Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Financial

expenses 3972727915 3422894839 16.06%

R&D

expenses 9522837963 8633638171 10.30%

4. R&D investments

? Applicable □ Not applicable

Main R&D project Anticipated impact on

name Purpose Progress Preset goals the future development of the Company

Develop high-PPI Leverage technological

High-quality VR Enhance VR image Develop ultra-high- leadership to attract

technology quality to achieve high resolution VR display

LTPO VR technology

technology with 2K*2K enhancing VR display

high-end customers

development PPI resolution per eye quality and reducing

enhancing brand value

power consumption and product competitiveness

Development of a 14-inch 2.8K in-cell The world's first 14- Enhanced product

14-inch 2.8K active pen eye-care Realized industrial inch 2.8K in-cell active competitiveness and

flagship tablet large-screen tablet transformation pen eye-care large-screen tablet industry influence

Empowering R&D Deep engagement in

Star Intelligence efficiency and quality Leveraged multi-modal business activities

Large Model Expert improvement through Realized industrial large models in R&D accelerated the R&D

System deep understanding and transformation design to empower process and improved

learning panel development R&D efficiency and product quality

Utilized AI algorithms

Capitalized upon AI to enhance yield Completed system Used AI and big data

and big data for analysis efficiency Realized industrial implementation and algorithms to enhance failure analysis and swiftly pinpointed deployment and yield analysis and

application defect root causes and transformation gradual roll-out to all improve manufacturing

simulation accelerated plants processes

improvement measures

Achieved lower power Enhanced brand

WQHD LTPO Achieved a lower refresh rate and reduced Realized industrial

consumption while

effectively addressing awareness and product

display technology power consumption transformation visual fatigue. competitiveness in the

LTPO segment

Reduced costs while Identified novel high-

AI-assisted R&D of enhancing efficiency for AI-assisted R&D performance and stable Facilitated the

OLED materials R&D of OLED platform for OLED OLED materials with industrialization of materials with AI materials AI-based generation OLED materials

technologies and screening

Achieved enhanced

Developed technological Breakthrough in POL

proprietary high- competitiveness through specifications /

speed CSPI national breakthroughs in POL development of material

standard protocols material specifications Realized industrial transformation platforms;

Reduced cost and

and key display the development of Proprietary R&D of enhanced efficiency

materials e.g. color material platforms and POL membrane

filters and polarizers proprietary research of materials.membrane materials.R&D of key Met the market Promoted production Improved the quality of Enhanced the core

technologies for N- requirements for process improvement monocrystalline silicon competitiveness of the

type silicon single technical indicators of and product quality met customer needs company's main

crystals designed N-type monocrystalline consistency with further improved business

31Full Text of the Annual Report 2023 of TCL Technology Group Corporation

for solar cells and silicon technology and ongoing mass efficiency reduced

their applications strengthened the production by costs and achieved an

Company's core enhancing Total increase in market share

competitiveness Solution capabilities of N-type

participating in monocrystalline silicon

customer product and

process design-in and

establishing IPD

collaboration with N-

type customers

Having addressed the

challenges associated

with granular silicon

Removed technical feedstock through

barriers in the use of process innovation the Achieved 100%

Researched and granular silicon Company has mastered application by

applied granular feedstock in single its application method enhancing the quality of Reduced silicon costs

silicon in the single crystal pulling enabling the production granular silicon and improved product

crystal silicon processes to reduce of higher-quality single feedstock and competitiveness for the

preparation process silicon costs and crystal silicon rods. developed granular Company

enhance product This method can be silicon application

competitiveness applied to 100% of the solutions Company's products

placing the Company at

the forefront of the

industry

Researched and

developed ultra-thin Equipment upgrading and cutting process Achieved the 130μm

R&D of G12 silicon solar silicon wafer cutting technology to design have been

thick SoP target for Enhanced the core

wafer slicing meet the demand for completed; SoP has

silicon wafers; and

completed the 110μm competitiveness of the technology thin film in the been realized for 130um thick technical reserve main business

downstream market and and 120um G12 silicon for silicon wafers

to improve unit output wafers

By successfully

developing the 4.0 The development of the

product and equipment 4.0 technology platform

platform achieving SoP designed for components was

Developed the 4.0 and obtaining product Increased our market

technology platform certification the

completed on schedule

resulting in components share by successfully

Enhanced the core

Company has further transitioning to N-type competitiveness of for components expanded its product with superior power battery packs

portfolio to meet output efficiency and

component products

diverse market demands cost-effectiveness

under various paving the way for their

application scenarios market introduction

The introduction of the

new battery graphic

Reduced silver design has resulted in a

consumption by 0.03% 0.07% increase in cell- Met customers'

increasing efficiency level efficiency during demands while

Optimized battery and enhancing both large-scale trial reducing cost and Enhanced the core

graphic design battery efficiency and production while improving efficiency as competitiveness of

component power with meeting component well as raising market battery packs

the optimized positive process yield share

and negative circuit requirements and

achieving a 0.2%

improvement in

32Full Text of the Annual Report 2023 of TCL Technology Group Corporation

component CTM

R&D personnel

2023 2022 Change (%)

Number of R&D employees 11313 11979 -5.56%

As % of R&D employees (%) 15.04% 17.16% -2.12%

Education

PhD 188 231 -18.61%

Master 2131 2442 -12.74%

Bachelor's degree and others 8994 9306 -3.35%

Age

Under 30 years old 5965 7286 -18.13%

30~40 years old 4696 4280 9.72%

Over 40 years 652 413 57.87%

R&D investments

2023 2022 Change (%)

R&D investment amount (RMB) 10308543529 10778414851 -4.36%

R&D investments as % of total revenue (%) 5.91% 6.47% -0.56%

Capitalization amount of R&D investments

(RMB) 3560255965 4287426803 -16.96%

Capitalization amount of R&D investments

as % of total revenue (%) 34.54% 39.78% -5.24%

Reasons and impacts of major changes in the composition of R&D personnel of the Company

□ Applicable ?Not Applicable

Reasons for significant changes in R&D investment as % of total revenue compared with the previous year

□ Applicable ?Not Applicable

Reasons for significant changes in R&D investments capitalization and explanation of rationale

□ Applicable ?Not Applicable

5. Cash flow

Unit: RMB

Item 2023 2022 Change (%)

Sub-total of cash generated from 155010648305 155632096991 -0.40%

operating activities

Sub-total of cash used in operating 129695892200 137205720382 -5.47%

activities

Net cash generated from operating 25314756105 18426376609 37.38%

activities

Sub-total of cash generated from 61202286515 51431426776 19.00%

investment activities

Subtotal of cash used in investing 101999341466 98267398620 3.80%

33Full Text of the Annual Report 2023 of TCL Technology Group Corporation

activities

Net cash used in investing activities -40797054951 -46835971844 12.89%

Sub-total of cash generated from 70023939233 113655272732 -38.39%

financing activities

Subtotal of cash used in financing 68232173839 82254617585 -17.05%

activities

Net cash generated from financing 1791765394 31400655147 -94.29%

activities

Net increase in cash and cash -13678809131 3593919427 -480.61%

equivalents

Explanation of why related data has significant changes year-on-year

? Applicable □ Not applicable

Net cash generated from operating activities: Primarily due to the increase in scale of sales during the Reporting Period.Net cash generated from financing activities: Primarily due to the decrease in scale of financing during the Reporting Period.Explanation of the significant difference between the net cash flow generated by the Company's operating activities and the net profit

of the current year during the reporting period

? Applicable □ Not applicable

The large difference between the net cash flow generated by the Company's operations and the net profits of the current year is primarily

caused by factors such as depreciation amortization and impairment of the Company's assets during the Reporting Period.V. Analysis of Non-Core Businesses

? Applicable □ Not applicable

Unit: RMB

Amount As % of gross profit Source Sustainability

Asset impairment -4813965478 -95.29% Depreciation of inventory write-off in line with the market No

Non-operating income 71284932 1.41% No

Non-operating expenses 203779883 4.03% No

VI. Analysis of Assets and Liabilities

1. Significant changes in asset composition

Unit: RMB

The end of 2023 January 1 2023 Change in

percentage Main reason for

Amount Total assets Percentage Amount

Total assets change

Percentage (%)

Primarily due to the

Monetary

assets 21924270872 5.73% 35378501261 9.83% -4.10%

purchase of low-risk

wealth management

products

34Full Text of the Annual Report 2023 of TCL Technology Group Corporation

Accounts 22003651259 5.75% 14051661462 3.90% 1.85% Primarily due to the receivable increase in sales scale

Contract assets 343907118 0.09% 315167085 0.09% 0.00% No significant change

Inventories 18481754865 4.83% 18001121855 5.00% -0.17% No significant change

Investment

property 911679154 0.24% 946449125 0.26% -0.02% No significant change

Long-term

equity 25431271193 6.64% 29256215804 8.13% -1.49% No significant change

investments

Primarily due to

construction in

progress being

Fixed assets 176422620794 46.08% 132477671844 36.80% 9.28% converted into fixed

assets resulting in

increase in fixed

assets

Primarily due to

construction in

progress being

Construction in

progress 17000052457 4.44% 52053833629 14.46% -10.02%

converted into fixed

assets resulting in

decrease in

construction in

progress

Right-of-use

assets 6386446373 1.67% 5110123904 1.42% 0.25% No significant change

Short-term

borrowings 8473582304 2.21% 10215910963 2.84% -0.62% No significant change

Contract

liabilities 1899468140 0.50% 2336008164 0.65% -0.15% No significant change

Long-term

borrowings 117662208623

30.73% 118603164839 32.95% -2.21% No significant change

Lease liabilities 5737287693 1.50% 4461382902 1.24% 0.26% No significant change

Higher proportion of overseas assets

□ Applicable ?Not Applicable

35Full Text of the Annual Report 2023 of TCL Technology Group Corporation

2. Assets and liabilities at fair value

? Applicable □ Not applicable

Unit: RMB

Gain/loss of fair- Impairment

Item Beginning value changes in

Cumulative fair- Amount Amount sold in

amount the Reporting value changes

allowances

recorded in equity established in the

purchased in the the Reporting Other changes Ending amount

Period Reporting Period Reporting Period Period

Financial assets

1. Held-for-

trading financial

assets (excluding 15632334714 -82730184 36690131991 26084053319 26155683203

derivative

financial assets)

2. Derivative 361034230 188835246 26600642 -468462515 108007603 financial assets

3. Receivables 1103127764 -148718206 954409558 financing

4. Other debt

investments

5. Investments in

other equity 439996263 -55954756 1720000 886911 386648418

instruments

Subtotal of

financial assets 17536492971 106105062 -29354114 36691851991 26084053319 -616293810 27604748782

Total of the above 17536492971 106105062 -29354114 36691851991 26084053319 -616293810 27604748782

Financial 932646673 78767446 143869843 1097300600 1942542301 310042260 liabilities

行情