Business Philosophy and Vision

The origins of Wafer Works can be traced back to Helitek, which was established in the United States in 1986. Since its inception, the Company has focused on the silicon wafer industry. Its founding team, originating from Silicon Valley in the United States and Taiwan's semiconductor industry, possessed extensive expertise and industry experience in silicon wafer technologies, laying the foundation for Wafer Works' important position in the global semiconductor materials market. In 1997, Wafer Works Corporation was officially established in Taiwan. In 2011, Wafer Works established its headquarters in the Longtan Science Park. Following more than two decades of R&D investment and capacity deployment, the Company has established 6 manufacturing centers in Taiwan and Mainland China, while also setting up service locations in the United States, Europe, and Asia, forming a globalized production and technical service network.

Since its establishment, Wafer Works has continuously strengthened its R&D capabilities and operational efficiency, while maintaining a high level of regulatory compliance through rigorous management systems. In terms of products and services, the Company has no records of material violations of laws or anti-competitive conduct, demonstrating Wafer Works' commitment to ethical management. In 2007, Wafer Works was selected by Forbes Asia as one of the "Best Under a Billion" companies, recognizing its outstanding operational performance and growth potential.

Wafer Works firmly believes that strong partnerships form the foundation of corporate competitiveness. Through close interaction with customers, the Company stays informed of demand trends, while collaborating with suppliers to establish flexible and resilient supply chain models, enabling the continuous development of materials and services that exceed customer expectations. At the same time, the Company regards employees as its core assets and upholds its corporate core values in attracting and cultivating talent. Wafer Works is committed to creating a safe, inclusive, and growth-oriented working environment, respecting human rights, emphasizing occupational safety and health, and sharing operating achievements with employees.

In 2012, Wafer Works published its first Corporate Social Responsibility Report. Guided by the concept of sustainable corporate development, the Company gradually expanded its disclosure scope from corporate social responsibility to include corporate governance, environmental management, supply chain sustainability, social participation, and diversity and inclusion, comprehensively presenting its sustainability strategies and performance. In response to the rapid changes in the global semiconductor supply chain and ecological environmental challenges, the Company has adopted the vision of "becoming a customer-oriented semiconductor material supplier." Through 6 major pillars―corporate governance, environmental sustainability, customer service, supply chain management, diversity and inclusion, and social participation―the Company implements sustainable operations, responds to stakeholder expectations, and continuously creates positive impacts for society.

Looking ahead, Wafer Works will continue to enhance its technological self-reliance capabilities, expand its market presence, and move toward the goal of becoming a world-class leading supplier through sound operations, innovative R&D, and sustainable management, thereby fulfilling its commitment to balancing corporate growth with sustainable value.

Wafer Works Yangmei Fab (WWXT)	Wafer Works Longtan Fab Headquarter (WWXL)

 Wafer Works Business Philosophy

  Main Products and Services

Epitaxial Silicon Wafers	Polished Silicon Wafer

Wafer Works Corporation primarily provides semiconductor epitaxial silicon wafers, semiconductor polished silicon wafers (single-side polished and double-side polished wafers), SOI wafers (Silicon-On-Insulator wafers), gallium nitride epitaxial wafers, and square chip products (or services). The Company actively provides customers with appropriate, compliant, and application-specific products while striving to achieve superior quality. With the ultimate goals of developing and researching new products, reducing material waste, and protecting the environment, the Company also provides a comprehensive communication process to facilitate better product utilization, services, and sales interactions between customers and Wafer Works. Throughout the transaction process, customers are provided with high-quality, prompt, and comprehensive services. All products manufactured by Wafer Works comply with relevant legal requirements, while the Company continuously maintains product quality in accordance with regulatory standards and individual customer specifications. Wafer Works also strives to improve product yield rates and service quality to meet customers' subsequent manufacturing process requirements and the service expectations of end customers.

The communication process is as follows :

Below is the sales statistics for each region for the year 2025:

Global Deployment

Operational Performance

Operational Performance –Optimization of 12-inch Product Portfolio

In 2025, the global economic environment remained highly uncertain. Persistent geopolitical tensions and a restructuring of the international trade order, coupled with high interest rates dampening end-market consumption, led to a fragmented recovery across different sectors. Despite these headwinds, the rapid expansion of Artificial Intelligence (AI) applications has catalyzed a structural shift in semiconductor demand. Increased investments in advanced process technologies and advanced packaging have become key contributors to sustaining industry momentum.

According to SEMI, global silicon wafer shipments rebounded in 2025 compared to the prior year, supported by demand from AI, high-performance computing (HPC), and advanced packaging applications. In the same year, Wafer Works Corporation reported consolidated revenue of NT$9.817 billion, representing a year-over-year (YoY) increase of approximately 12.6%, with earnings per share (EPS) of approximately NT$0.09. Alongside the continued improvement in operating performance, the Company also completed the deployment of its 12-inch product portfolio and capacity, establishing a solid foundation for future growth.

Looking ahead, competition in the semiconductor industry is increasingly defined not only by capacity scale, but also by technology node advancement, material solution capabilities, and the depth and speed of collaboration with customers. To address AI-driven demand for advanced process technologies and advanced packaging, the Company has undertaken a number of key initiatives to align with industry trends.

In 2026, Wafer Works will focus on the following five strategic priorities:

1. Organizational Synergy and Execution

2. Expanding global presence while deepening local engagement

3. Driving differentiation strategy

4. Advancing core products and subsidiary growth in parallel

5. Strengthening long-term value through disciplined financial strategy

Financial Information

The table below presents various financial information for Wafer Works, including disclosure of employee salaries and social investments:

During the reporting period, Wafer Works received financial subsidies from the following government units:

Board of Directors

Wafer Works adopts the candidate nomination system stipulated in Article 192-1 of the Company Act for the election of directors, with a term of three years. The independence of independent director candidates must also comply with the provisions of the "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies." The current board of directors consists of seven male directors and two female director, four of whom are independent directors. The average age range is mostly over 60 years old. Directors serve a three-year term, and each director has at least 30 years of work experience in business, legal, financial, accounting, or corporate affairs fields. Their expertise spans industries such as semiconductors, optoelectronics, and venture capital, demonstrating rich knowledge, personal insight, and business judgment, providing valuable advice on Wafer Works' operational strategies and development direction. To enhance the professional knowledge, legal literacy, and sustainability awareness of Board members, the Company proactively arranges at least three hours of annual training courses conducted by external professional instructors. In 2025, the total training hours completed by the Board of Directors amounted to 86 hours, of which 52 hours were related to sustainable development, accounting for 60.47% of the total. For details regarding Board training, please refer to Wafer Works's 2025 Annual Report. In 2025, the Board of Directors of Wafer Works Corporation convened a total of five meetings.

In response to the Company's operational issues and sustainable development objectives, progress on greenhouse gas inventory and verification schedules was reported to the Board in four of these meetings. The Company has established the "Procedures for Managing the Acquisition or Disposal of Assets," "Regulations Governing the Election of Directors," "Ethical Corporate Management Best Practice Principles," "Procedures for Ethical Management and Guidelines for Conduct," "Procedures for Handling Material Inside Information and Preventing Insider Trading," and "Rules of Procedure for Board of Directors Meetings." These documents cover various aspects including the prevention of conflicts of interest, avoiding opportunities for personal gain, confidentiality responsibilities, fair trading, protection and proper use of company assets, compliance with laws and regulations, encouragement to report any illegal or unethical behavior, and disciplinary measures. All related guidelines have been approved by the Board of Directors and are implemented accordingly. Disclosure of cross-shareholding, transactions, and outstanding balances between the highest governing body members and critical suppliers will be made in the future. For information on the highest governing body members serving on other boards, please refer to the corporate governance report in the Company's 2025 Annual Report, specifically the sections on Board Member Information (I) and Director Information (II). Directors must abstain from voting on proposals in which they have a personal interest, ensuring no cross-shareholding situations with stakeholders.

The education, experience, and attendance of the Board members are shown in the table below:

Audit Committee

To enhance corporate governance and the professional functions of the Board of Directors, Wafer Works established the Audit Committee on June 27, 2018. The committee consists of four independent directors and meets at least once every quarter. In 2025, the committee convened six times with an average attendance rate of 96.9%.

The primary objectives of the Audit Committee are to assist the Board in performing and supervising the following tasks:

1. Ensuring the fair presentation of the Company's financial statements.
2. Selecting, dismissing, and assessing the independence and performance of the external auditors.
3. Effectively implementing the Company's internal controls.
4. Ensuring the Company's compliance with relevant laws and regulations.
5. Managing existing or potential risks faced by the Company.

According to the Audit Committee Charter, the committee is authorized to conduct any appropriate audits and investigations within its scope of responsibility. It maintains direct communication channels with the Company's internal audit personnel, external auditors, and other relevant individuals. The committee is also empowered to engage legal counsel, accountants, or other professionals to assist in the execution of its duties.

Attendance of Independent Directors at the Audit Committee in 2025:

Compensation Committee

To assist the Board of Directors in evaluating the performance of management and to improve the compensation system for directors and managers, Wafer Works established the Compensation Committee on December 29, 2011. The committee is composed of a majority of independent directors and meets at least twice a year. In 2025, the committee held three meetings with an average attendance rate of 100%. The resolutions passed by the committee were submitted to the Board of Directors for discussion and subsequently approved by the board.

The committee's responsibilities include formulating and regularly reviewing the policies, systems, standards, and structures for performance evaluation and compensation for directors and managers. It ensures that individual compensation is tied to company performance in compliance with relevant laws, and is linked to future operational performance and risks. Given the industry's significant economic cycles and profit volatility, and the absence of shareholders with relative control participating in compensation decisions, the directors' remuneration remains stable. Currently, no consultants are involved in setting compensation.

The Company continuously reviews the external market competitiveness of employee salaries and compensation packages, participates in salary surveys to stay informed about market salary levels, and sets salary adjustment policies. It also establishes principles for holiday bonuses, employee bonus plans, outstanding employee incentive measures, and retention bonuses for key talent, recognizing long-serving outstanding employees to attract, motivate, and retain exceptional talent.

Wafer Works has strengthened the linkage between performance and compensation for key core talents and senior executives. Short-term incentive measures are primarily based on performance bonuses, supplemented by employee profit-sharing bonuses. Long-term incentive and talent retention measures take into consideration the Company's financial condition, operating performance, and future development in order to retain talent over the long term. In accordance with Article 267 of the Company Act and relevant regulations such as the "Regulations Governing the Offering and Issuance of Securities by Securities Issuers" promulgated by the Financial Supervisory Commission, the Company established the "2022–2024 Restricted Stock Award Issuance Regulations." From 2022 to 2025, the Company successively granted restricted stock awards to senior executives and key talents, linking compensation with shareholder interests as well as economic, environmental, and social performance, thereby enhancing corporate competitiveness and maximizing benefits for both the Company and its shareholders.

The bonuses of directors at Wafer Works are governed by Article 29 of the Company's Articles of Incorporation. In profitable years, Wafer Works shall allocate up to 2% of its profits as director bonuses. However, in the presence of accumulated losses, an amount must be set aside in advance for offset. Article 25 thereof provides that the Chairman and directors of Wafer Works shall be remunerated by the Company for their duties. The amount of such remuneration is determined by the Board of Directors based on their level of involvement and contribution to the Company's operations, while also considering industry standards. In order to implement the spirit of corporate governance and provide a basis for the distribution of compensation to directors at Wafer Works, the "Regulations Governing the Payment of Compensation to Directors" was established. These Regulations were proposed by the Compensation Committee during the first meeting of the fourth term on August 7, 2018, and were subsequently approved by the Board of Directors during the second meeting of the ninth term on August 7, 2018.

In 2025, the highest annual compensation at Wafer Works Corporation was received by the President. The ratio of the President's annual total compensation to the median annual compensation of other employees was 7.74:1. The percentage increase in the President's annual compensation compared to the median compensation increase of all other employees was -19.4:1.

Attendance of Independent Directors at the Compensation Committee in 2025:

Risk Assessment

Wafer Works is committed to sustainable business practices, environmental and energy resources protection, and ensuring employee safety and health. Through a structured risk assessment process, we identify, evaluate, and respond to risks in economic, legal, operational, environmental, safety, health, and cybersecurity areas. We adhere to risk management procedures outlined in management systems such as ISO 9001:2015、IATF 16949:2016 、ISO 50001:2018、ISO 14001:2015、ISO 14064-1:2018、ISO 45001:2018、ISO/IEC 27001:2022. These procedures enable us to thoroughly assess potential emergencies, natural disasters, environmental impacts, and occupational risks, and to implement comprehensive response plans and processes. Report risk assessment and management strategies to the Board of Directors on an annual basis.

Each department within Wafer Works conducts risk assessments and formulates management strategies relevant to their respective responsibilities, as detailed below:

Wafer Works Risk Management Strategy

Business Continuity Management (BCM)

In addition, Wafer Works continues to promote Business Continuity Management (BCM). Based on risk assessment results, the Company continuously conducts business continuity management for high-risk scenarios with significant potential impacts, such as extreme weather, fires, earthquakes, and information security incidents. Each quarter, the Company reviews the content of previous BCP drills to determine whether revisions are required due to environmental changes. In 2025, the Company reviewed drills related to information server room fires, shortages of critical materials, and water shortage scenarios, and updated the response procedures over time to ensure their effectiveness.

Ethical Corporat Management

"Honesty and Innovation" serves as the foundation of our operational ethos, dedicated to advancing corporate governance with elevated ethical standards, and upholding the principles of fairness, honesty, trustworthiness, and transparency in all business endeavors.

To embody the spirit of ethical management, Wafer Works has established the "Ethical Corporate Management Best Practice Principles," "Procedures for Ethical Management and Guidelines for Conduct," and "Procedures for Handling Material Inside Information and Preventing Insider Trading," which have been approved by the Board of Directors. These guidelines regulate the behavior of board members and company employees. Furthermore, in alignment with the principles advocated by the Responsible Business Alliance (RBA), Wafer Works has implemented the "Code of Ethical Business Conduct" to promote ethical behavior among all employees. This initiative seeks to standardize behavior during business operations, emphasizing the importance of professional competence and ethical judgment in protecting the Company's assets, interests, and reputation.

To ensure that daily operations meet high ethical standards, Wafer Works has established basic conduct guidelines for directors, managers, general employees, and business partners while performing their duties, including the "Code of Ethical Business Conduct" and "RBA Code of Conduct Identification and Management Guidelines." Commitment to these standards includes: (1) Ethical principles; (2) Respect for individuals and customers; (3) Avoidance of conflicts of interest; (4) Gifts and business hospitality; (5) Facilitation payment; (6) Provision of complete, proper, accurate, timely, and understandable information disclosure; (7) Reporting, protection, and immunity; and (8) Corporate social responsibility. We advocate for a culture of integrity and, in the face of various challenges in industry competition, are obligated to collectively uphold the Company's reputation to earn the respect and trust of customers, suppliers, and the industry, ensuring the sustainable operation and development of Wafer Works. In 2025, a "Wafer Works Supplier Code of Conduct Compliance Statement" was issued to critical and important suppliers, with a signing and returning rate of 99%. Looking ahead to 2026, Wafer Works Corporation will remain committed to working with key and critical suppliers to ensure the ongoing execution of the "Supplier Code of Conduct Compliance Declaration."

Wafer Works adheres to the principles of integrity and pragmatism, complying with government laws and regulations, and is committed to abiding by government social and economic policies, fulfilling its corporate social responsibility. During the reporting period, Wafer Works did not incur any fines for violations of environmental, social, or product (or service) regulations, nor did it face any antitrust or anti-monopolistic lawsuits.

Wafer Works regularly conducts educational training and awareness programs to ensure that employees fully understand the Company's commitment to ethical operations, policies, preventive measures, and the consequences of unethical behavior. We uphold a positive pursuit and quality assurance, aspiring to innovate for the future and sustain operations based on these principles.

At Wafer Works, we respect the diversity of employee backgrounds and abilities, striving for balanced development in employees' work and life quality. In human resources management, we balance institutionalization with humanization, treating all employees fairly and justly. We establish mutual trust and open communication channels, providing a work environment free from any discrimination or unequal treatment, enabling employees to contribute their best and become important long-term partners. Wafer Works provides a complaint process (as shown in the diagram below) for handling relevant issues, and there were no incidents of discrimination this year.

Complaint Process

Following an analysis of stakeholder communication and impact, the management of wastewater and waste disposal is crucial for Wafer Works. Failure to manage wastewater and waste could lead to regulatory penalties in the future. Responsible management of wastewater and waste can mitigate cost risks for Wafer Works and enhance the Company's competitiveness in sustainability. Currently, environmental issues are handled by the occupational safety and health office or facility management department at each fab, and there were no major incidents of liquid or gas leakage resulting in penalties during the reporting year.

Anti-corruption System

Wafer Works Corporation adheres to the Code of Ethical Conduct and the RBA Code of Business Ethics. In accordance with the "RBA Risk Assessment Management Guidelines," the Company conducts anti-corruption risk assessments for directors, supervisors, managers, and employees. Based on the "RBA Code of Business Ethics," the Company regularly conducts training and awareness sessions. In 2025, RBA and ethical business (anti-corruption and insider trading prevention) training courses were held, with 94.9% Board member participation rate and a total of 1,052 employee participants. These trainings aim to ensure that the governance units and all employees understand the Company's commitment to ethical business practices, related policies, preventive measures, and consequences of misconduct. "Integrity First" is the core business philosophy of Wafer Works Corporation. All directors and employees at job grade 9 and above signed the Anti-Corruption Commitment Declaration, with a 100% completion rate, demonstrating the Company's strong anti-corruption stance. In 2025, corruption risk assessments were conducted at the Longtan and Yangmei sites, and no corruption risks were identified. There were no corruption incidents or complaints of suspected corruption reported throughout the year.

Wafer Works Information Security Policy

Information Security Organization, Members, and Oversigh

The Company has established an Information Security Committee tasked with formulating and reviewing information security policies, resource allocation, and reviewing the implementation of various measures. Senior management executives serve as management representatives, responsible for coordinating and promoting information security management matters. Regular cyber security meetings are held, and reports are submitted to the board of directors.

Information Security Management Plan

Wafer Works is comprehensively enhancing its cyber security management. The cyber security resource investment for 2024 includes the following projects: