2023 Annual Report of TCL Technology Group Corporation (Summary)
Stock Code: 000100 Stock Abbr.: TCL TECH. Announcement No.: 2024-017
TCL 科技集团股份有限公司
TCL Technology Group Corporation
ANNUAL REPORT 2023
(Summary)
April 28, 2024
1
2023 Annual Report of TCL Technology Group Corporation (Summary)
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.
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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 and achieve a sustained growth. 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 15,331 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
robusttechnology 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.
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
Part I Important Notes
This summary is based on the full text of the 2023 Annual Report of TCL Technology Group Corporation. To obtain
a full picture of the operating results, financial position and future development plans of the Company, investors
should carefully read through the annual report released on the media designated by the China Securities Regulatory
Commission.
All the Company's directors attended the Board meeting for the review of this Report and its summary.
This Report and its summary have been prepared in both Chinese and English. Should there be any discrepancies
or misunderstandings between the two versions, the Chinese version shall prevail.
Independent auditor's modified opinion
□ Applicable Not Applicable
Profit distribution plan or plan to convert capital reserve into share capital approved by the Board of Directors
Applicable □ Not applicable
Any share capital converted from capital reserve or not
□Yes No
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 18,779,080,767(Any repurchased shares held by the company upon profit distribution are exclusive of the
distribution), without bonus shares or shares converted from capital reserve.
Plans for profit distribution of preferred stock for the Reporting Period approved by the Board of Directors
□ Applicable Not Applicable
Part II Corporate Information
1. Stock Profile
Stock name TCL TECH. Stock code 000100
Place of listing Shenzhen Stock Exchange
Contact information Board Secretary
Name Liao Qian
10/F, Tower G1, International E Town, TCL Science Park, 1001 Nanshan District,
Office address
Shenzhen, Guangdong Province, China
Tel. 0755-3331 1666
Email address ir@tcl.com
2. Main businesses or products 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
materials, and was committed to achieving the strategic goal of global leadership. For details of the Company's business, please refer
to "Part IV Report of the Board" herein.
3. Key Accounting Data and Financial Indicators
(1) Key accounting data and financial indicators in the past three years
Indicate whether there is any retrospectively adjusted or restated datum in the table below
Yes □ No
Unit: RMB
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 382,859,086,727 359,996,232,668 359,996,232,668 6.35% 308,733,133,305 308,749,696,062
Owners'
equity
attributable
52,921,867,086 50,678,520,477 50,678,520,477 4.43% 43,034,234,611 43,041,044,200
to the
company's
shareholders
2023-Over-
2022 2021
2022 Change
2023
Before After Before
After adjustment After adjustment
adjustment adjustment adjustment
Revenue 174,366,657,015 166,552,785,829 166,552,785,829 4.69% 163,540,559,623 163,657,700,477
Net profit
attributable
to the 2,214,935,302 261,319,451 261,319,451 747.60% 10,057,443,528 10,064,253,118
company's
shareholders
Net profits
attributable
to the
company's
shareholders 1,021,080,065 -2,698,210,800 -2,698,210,800 137.84% 9,437,240,976 9,444,050,566
after non-
recurring
gains and
losses
Net cash
generated
from 25,314,756,105 18,426,376,609 18,426,376,609 37.38% 32,878,450,437 32,878,450,437
operating
activities
Basic
earnings per
0.1195 0.0191 0.0174 586.78% 0.7463 0.6789
share
(RMB/share)
Diluted
earnings per
0.1179 0.0185 0.0168 601.79% 0.7354 0.6690
share
(RMB/share)
Weighted Increase by
average 3.76
4.27 0.52 0.52 26.46 26.48
return on percentage
equity (%) points YoY
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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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.
(2) Main accounting data by quarter
Unit: RMB
Q1 Q2 Q3 Q4
Revenue 39,443,242,439 45,705,483,167 47,960,309,079 41,257,622,330
Net profit attributable to the company's
-548,999,154 889,492,743 1,270,918,405 603,523,308
shareholders
Net profits attributable to the company's
shareholders after non-recurring gains and -729,931,586 129,864,746 1,107,560,913 513,585,992
losses
Net cash generated from operating
4,495,356,538 5,920,811,609 5,727,844,866 9,170,743,092
activities
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
4. Share capital and shareholders
(1) Table of the total number of ordinary shareholders and preferred shareholders with resumed voting rights as well as
shareholding of the top ten shareholders
Unit: Share
Number of
Number of Total number of
preferred
Total number of ordinary preferred
shareholders with
ordinary shareholders shareholders with
resumed voting
shareholders by 600,087 at the month- 578,652 resumed voting 0 0
rights at the
the end of the end prior to rights by the end
month-end prior
reporting period the disclosure of the reporting
to the disclosure
of this Report period
of this Report
Shareholdings of top 10 shareholders of ordinary shares
(excluding the lending of shares under refinancing)
Shareholding Number of Shares in pledge,
Name of Nature of marked or frozen
percentage Number of shares held restricted shares
shareholder shareholder
(%) held Status Number
Li Dongsheng Domestic
Ningbo Jiutian individual/Do
6.73% 1,264,053,189 672,868,839
Liancheng Equity mestic general Pledge 293,668,015
Investment legal entity
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2023 Annual Report of TCL Technology Group Corporation (Summary)
Partnership
(Limited
Partnership)
Hong Kong
Securities Foreign legal
5.53% 1,037,612,543
Clearing entity
Company Ltd.
Huizhou
Public legal
Investment 4.35% 817,453,824
entity
Holding Co., Ltd.
Wuhan Optics
Valley Industrial Public legal
2.83% 532,003,016 Pledge 249,000,000
Investment Co., entity
Ltd.
China Securities
Domestic
Finance
general legal 2.19% 410,554,710
Corporation
entity
Limited
Perseverance
Asset
Management
Fund, wealth
Partnership
management 1.21% 226,736,512
(Limited
product, etc.
Partnership) -
Gaoyi Xiaofeng
No. 2 Zhixin Fund
CITIC Securities Financial
1.20% 225,726,798
Co., Ltd. Institution
Bank of China
Limited - Huatai- Fund, wealth
Pinebridge CSI management 1.09% 204,079,760
Photovoltaic product, etc.
Industry ETF
China Foreign
Economy and
Trade Trust Co.,
Ltd. - Foreign Fund, wealth
trade trust - Gaoyi management 0.90% 168,599,830
Xiaofeng product, etc.
Hongyuan
Collective Fund
Trust Scheme
Strategic investor or general legal
entity becoming top-10 ordinary
Not applicable
shareholders due to private
placement of new shares
Among the top 10 shareholders, Mr. Li Dongsheng and Ningbo Jiutian Liancheng Equity
Investment Partnership (Limited Partnership) became persons acting in concert by signing the
Agreement on Concerted Action. Mr. Li Dongsheng holds 897,158,453 shares and Ningbo
Note on the above shareholders'
associations or concerted actions Jiutian Liancheng Equity Investment Partnership (Limited Partnership) holds 366,894,736
shares, representing 1,264,053,189 shares in total and becoming the largest shareholder of the
Company.
Explain if any of the shareholders
above was involved in Not applicable
entrusting/being entrusted with
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2023 Annual Report of TCL Technology Group Corporation (Summary)
voting rights or waiving voting
rights
Explanation on repurchase accounts
Not applicable
among top 10 shareholders
Top 10 shareholders participating in the lending of shares under the refinancing business
Applicable □ Not applicable
Unit: Share
Top 10 shareholders participating in the lending of shares under the refinancing business
Shares lent under
Shares in the ordinary Shares lent under
refinancing at the Shares in the ordinary
account and credit account refinancing at the end of
beginning of the period account and credit account
at the beginning of the the period that have not
Name of that have not been at the end of the period
period been returned
shareholder returned
(full name) Proportio Proportion Proportio
Proportion
Total Total n to total Total to total Total n to total
to total
number number share number share number share
share capital
capital capital capital
Huizhou
Investment
722,139,840 4.23% 21,000,000 0.12% 817,453,824 4.35% 0 0%
Holding
Co., Ltd.
Wuhan
Optics
Valley
128,312,396 0.75% 430,240,000 2.52% 532,003,016 2.83% 0 0%
Industrial
Investment
Co., Ltd.
Bank of
China
Limited -
Huatai-
Unknown Unknown
Pinebridge 0 0% 204,079,760 1.09% 1,602,800 0.01%
(note) (note)
CSI
Photovoltaic
Industry
ETF
Note: The regular shareholder data provided by the China Securities Depository and Clearing Corporation Limited does not contain
this information.
Change in the top 10 shareholders compared with the previous period
Applicable □ Not applicable
Unit: Share
Changes in the top 10 shareholders compared with the end of previous period
Number of shares lent under Number of shares held in the ordinary
refinancing at the end of the account, credit account and lending
Addition/exit period that have not been through refinancing that have not been
Name of shareholder (full
during the returned returned at the end of the period
name)
Reporting Period
Total Proportion to Proportion to total
Total number
number total share share capital
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2023 Annual Report of TCL Technology Group Corporation (Summary)
capital
Wuhan Optics Valley
Industrial Investment Co., Addition 0 0% 532,003,016 2.83%
Ltd.
Perseverance Asset
Management Partnership
(Limited Partnership) - Addition 0 0% 226,736,512 1.21%
Gaoyi Xiaofeng No. 2
Zhixin Fund
Bank of China Limited -
Huatai-Pinebridge CSI Addition 1,602,800 0.01% 205,682,560 1.09%
Photovoltaic Industry ETF
China Foreign Economy and
Trade Trust Co., Ltd. -
Foreign trade trust - Gaoyi
Addition 0 0% 168,599,830 0.90%
Xiaofeng Hongyuan
Collective Fund Trust
Scheme
Guotai Junan Securities Co.,
Exit 0 0% 8,794,061 0.05%
Ltd.
Everbright Securities
Exit 0 0% 10,414,915 0.06%
Company Limited
UBS AG Exit 0 0% 62,073,717 0.33%
GF Securities Co., Ltd. Exit 0 0% 53,191,566 0.28%
Unknown
Haitong Securities Co., Ltd. Exit Unknown (note) Unknown (note) Unknown (note)
(note)
Note: The regular shareholder data provided by the China Securities Depository and Clearing Corporation Limited does not contain
this information.
(2) Total number of preferred shareholders and shareholdings of the top 10 preferred shareholders
□ Applicable Not Applicable
During the Reporting Period, the Company did not have any preferred stock shareholder.
(3) Disclosure of property rights and control relationship between the Company and the actual controller with block diagram
□ Applicable Not Applicable
5. Existing bonds on the date of approval and disclosure of the annual report
Applicable □ Not applicable
(1) General Information on Corporate Bonds
Outstanding
Coupon
Bond name Abbr. Bond code Date of issuance Maturity balance
rate
(RMB0'000)
TCL Corporation Corporate
Bonds Publicly Offered in October 21,
19TCL03 112983.SZ October 17, 2019 44,000 2.95%
2019 to Qualified Investors 2024
(Tranche 3)
TCL Corporation Corporate
Bonds Publicly Offered in
19TCL02 112938.SZ July 19, 2019 July 23, 2024 100,000 3.05%
2019 to Qualified Investors
(Tranche 2)
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2023 Annual Report of TCL Technology Group Corporation (Summary)
TCL Corporation Corporate
Bonds Publicly Offered in
19TCL01 112905.SZ May 17, 2019 May 20, 2024 100,000 3.15%
2019 to Qualified Investors
(Tranche 1)
Payment of interests on bond issued by the During the Reporting Period, the Company paid the interests on bonds as
Company during the Reporting Period scheduled.
(2) The latest tracking ratings and rating changes of bonds
No change
(3) Key accounting data and financial indicators of the Company for the past two years as at the end of the Reporting Period
End of the Reporting
Item December 31, 2022 Change
Period
Debt/asset ratio 62.1% 63.3% -1.23%
2023 2022 Change
Net profit after deducting non-recurring
220,705 -171,729 228.52%
gains and losses (RMB0'000)
Debt to EBITDA ratio 15.0% 12.1% 2.9%
Interest coverage ratio 1.80 0.92 95.65%
Part III. Significant Events
During the Reporting Period, the Company's business operations remained unchanged, and no
events that had a significant impact on the Company's operations.
Part IV Report of the Board
I. Company-related industry outlook in 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 displays 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,
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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 reducting losss 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 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
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
15,331 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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 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 sales
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
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.
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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.
New energy photovoltaics Industrial finance and
Display Others
and other silicon materials investment
Moka Zhonghuan Zhonghuan TCL
TCL CSOT Photovoltaic Advanced Finance TCL Capital Highly TPC
Technology
Juhua China Ray
1. Display business
In 2023, the user-end demand for display 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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 the market share of 65-inch
and above products increased to 51%; 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
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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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, displays 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
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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
accelerate the transformation and upgrading from a large-sized display leader to leader across the full
size of displays.
2. 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.
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 fair
impairment change losses, 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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
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 U.S. 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
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2023 Annual Report of TCL Technology Group Corporation (Summary)
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,
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.
TCL Technology Group Corporation
April 28, 2024
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