Solid State System (3S) 2018 Q4 Investor Conference 鑫創科技：3259 03/21/2019

Agenda Q4 FY18 Financial Results Q1 FY19 Guidance MEMS Mic. Status– Launch 2 Chips Series New Business

Safe Harbor Statement

Q4 FY18 Financial Results Q1 FY19 Guidance MEMS Mic. Status– Launch 2 Chips Series New Business

Q4 FY18 Income Statement 4Q18 3Q18 4Q17 QoQ(%) YoY(%) Sales 220,138 NT$K 4Q18 3Q18 4Q17 QoQ(%) YoY(%) Sales 220,138 190,333 211,841 16 4 Gross Profit 78,239 70,957 83,422 10 -6 Selling Expenses 18,914 16,742 16,741 G&A Expenses 11,380 10,520 8,818 R&D Expenses 47,331 43,985 41,665 Operating Income 614 (290) 16,198 312 -96 Non-operating Income& Exp. (313) 1,151 (1,136) Income Before Tax 301 861 15,062 Net Income 1,317 16,131 53 -92 EPS(NT$) 0.02 0.01 0.20 Weighted Avg. Outstanding Shares 80,860

FY18 Income Statement 2018 2017 YoY(%) Sales 739,621 611,896 21 NT$K 2018 2017 YoY(%) Sales 739,621 611,896 21 Gross Profit 255,238 202,885 26 Selling Expenses 66,061 62,085 G&A Expenses 43,588 36,093 R&D Expenses 173,905 180,383 Operating Income (28,316) (75,676) 63 Non-operating Income& Exp. 2,845 (3,821) Income Before Tax (25,471) (79,497) Net Income (20,159) (78,428) 74 EPS(NT$) (0.25) (0.97) Weighted Avg. Outstanding Shares 80,860

Q4 FY18 Balance Sheet Summary NT$K 4Q18 3Q18 4Q17 Current Assets 488,286 429,987 401,714 Cash and Cash Equivalents 33,899 25,691 48,790 Accounts Receivable 129,377 102,953 95,803 Inventory 246,412 208,168 132,018 Other Financial Assets – Current 66,025 81,891 115,777 Other Current Assets 12,573 11,284 9,326 Non-current Assets 264,517 268,468 254,650 Total Assets 752,803 698,455 656,364 Total Liabilities 184,181 130,716 67,149 Total Stockholders' Equity 568,622 567,739 589,215

Q4 FY18 Cash Flow Summary 4Q18 3Q18 4Q17 Operating Cash Flow (42,688) NT$K 4Q18 3Q18 4Q17 Operating Cash Flow (42,688) (43,654) 2,081 Investment Cash Flow 10,482 18,442 64 Financing Cash Flow 40,414 30,586 (33,168) Net increase in Cash & Equivalents 8,208 5,374 (31,023) Cash & Equivalents at the Beginning of the Period 25,691 20,317 79,813 Cash & Equivalents at the End of the Period 33,899 48,790

Q4 FY18 Financial Results Q1 FY19 Guidance MEMS Mic. Status– Launch 2 Chips Series New Business

Q1 FY19 Guidance Based on our current business outlook, the Company expects: Consolidated Q1FY19 revenue will be lower than Q4FY18 Consolidated Q1FY19 gross profit margin will be lower than Q4FY18 Consolidated Q1FY19 operating profit will be lower than Q4FY18

Q4 FY18 Financial Results Q1 FY19 Guidance MEMS Mic. Status– Launch 2 Chips Series New Business

Patented CMOS One Chip Design 3S In-house 1 Chip Mic. Tech. CMOS MEMS Microphone Single Chip (Sensor & ASIC in One Chip) Patented CMOS One Chip Design v.s. Multi Chips Design Pre-Amp MEMS Sensor Capacitors

Patented CMOS One Chip Design 3S In-house 2 Chip Mic. Tech. Pure MEMS Microphone Sensor Chip Analog MEMS Microphone Pre-Amp ASIC Chip Digital MEMS Microphone Pre-Amp ASIC Chip Patented CMOS One Chip Design v.s. Multi Chips Design Pre-Amp MEMS Sensor Capacitors

3S All Around Product Line–Single Chip Series Key Features Application Major Player CMOS Single Chip MEMS Microphone Unique Small, Sensitivity & Phase Matching TWS, Slim Frame NB, ANC, Watch, Glasses, Array Mic. 3S

3S All Around Product Line–2 Chips Series Key Features Target Application Major Player 2 Chips MEMS Microphone 　Ultra SNR 68dB/AOP 132dB, Smart Phone Smart Speaker Feed Back Mic of ANC, Automobile Knowles, Infineon SNR 70dB/AOP 124dB, Performance SNR 64dB/AOP 132dB, TV Knowles, Goertek, AAC, STM SNR 65dB/AOP 124dB, Value SNR 62dB/AOP 132dB, Memsensing SNR 62dB/AOP 124dB, TWS Memsensing, Zilltek, Goertek SNR <60dB Headset Mic.

2 Chips MEMS Mic. Status Key Features Status MP Digital Performance SNR 64dB/AOP 132dB, Bottom Eng. sample July SNR 65dB/AOP 124dB, Bottom Analog 　Ultra SNR 68dB/AOP 132dB, Bottom Sample April SNR 70dB/AOP 124dB, Bottom Value SNR 62dB/AOP 132dB, Bottom SNR 62dB/AOP 124dB, Bottom SNR 59dB/AOP 124dB, Top SNR<60dB/AOP 124dB, Top & Bottom Sep.

Q4 FY18 Financial Results Q1 FY19 Guidance MEMS Mic. Status– Launch 2 Chips Series New Business

New Business Headset is likely to become entry platform to access AI. The challenges of existing ANC headset makers are poor production yield and product noise reduction quality. 3S owns key ANC technology to high production yield and consistent yet excellent noise reduction quality. dB Hz dB Hz V.S. Industry ANC solution MP result 3S ANC solution MP result

Analog ANC Headset 3.5mm audio jack Bluetooth

Digital ANC Headset Bluetooth MP: July

Contact Us (Investors)：03-552-6533 www.3system.com.tw Solid State System：3259