For Shareholders

Report to Shareholders

Dear Shareholders:

First of all, thanks for your long-term support to Harmony Electronics. I’d like show my deep gratitude to all of you on behalf of the operation team of the Company.

Taking a comprehensive look at the domestic and foreign economic situation in 2022, under the influence of Covid-19 variant virus, Russia-Ukraine war, high inflation and climate change, the global economic performance is not satisfactory. However, due to the sharp drop in demand for consumer electronics products and the failure to eliminate the high inventory of terminal products, the quartz component industry’s operating conditions had been in short supply since the beginning of 2022, but gradually turned conservative in the third quarter of last year. Under the turbulent market environment, the Company's management team adopted a conservative business strategy, strived to adjust the operation direction, strengthened management performance and improved the cost structure, expecting to maintain stable operations. Now I would like to report to all shareholders the operation of the past year.

The Company’s 2022 operating performance: Its consolidated operating income reached NT$2.882 billion, a decrease of 19.93% from NT$3.599 billion in 2021. The annual consolidated net profit after-tax was NT$268 million, a decrease of 47.63% from 2021. Looking forward to this year (2023), in addition to consolidating the production and marketing benefits of existing products, the proportion of non-consumer electronic products will be adjusted in order to create opportunities for breakthroughs. Regarding the Company’s 2022 business results and 2023 business plan summary, as well as the impact of future company development strategies, external environmental laws and regulations, and the overall economic environment, the reports are as follows:

  1. Business results in the year of 2022
    (1)Implementation status of the operation plant:
    The consolidated operating revenue of the Company in 2022 was NT$ 2,881,594 thousands, with the consolidated operating profit of NT$ 263,379 thousands, the consolidated net profit after tax of NT$267,706 thousands, and the consolidated comprehensive income of NT$184,029 thousands. If compared with those figures in 2021, the consolidated operating revenue was reduced by NT$ 717,069 thousands (YoY -19.93%), the consolidated operating profit was dropped by NT$392,667 thousands (YoY -59.85%), the consolidated net profit after tax was reduced by NT$ 243,490 thousands (YoY -47.63%), and the consolidated comprehensive income was reduced by NT$444,185 thousands (YoY -70.71%).

    (2)Budget implementation status:
    The Company didn’t announce the financial prediction publically in 2022, so it doesn’t have to disclosure the budge implementation status.

    (3)Financial revenue & expenditure, and profitability:
Unit: NT$1,000; %  
(Except EPS is in the unit of NT$) 
Item / Year 2022 2021
Financial structure  Net amount of consolidated operating revenue 2,881,594  3,598,663 
 Consolidated operating margin 632,548  1,026,177 
 Consolidated operating profit 263,379  656,046 
 Net amount of consolidated profit after tax  267,706  511,196 
 Consolidated comprehensive profit 184,029  628,214 
Profitability  Return on total assets(%) 4.83  9.67 
 Return on equity(%) 7.72  15.49 
 Operating profit to paid-in capital(%) 24.61  61.29 
 Net profit before tax to paid-in capital(%) 32.76  61.41 
 Net profit margin(%) 9.29  14.21 
 EPS 2.50  4.76 


(4)Research and development status:

The Company’s product development mainly focuses on quartz components and micro-electromechanical sensing components. Quartz components include quartz crystals, general quartz oscillators, temperature compensated quartz oscillators, piezoelectric controlled quartz oscillators and differential output quartz crystal oscillators. The size of its miniaturized products is reduced from 2.0mm x 1.6mm, 1.6mm x 1.2mm to 1.2mm x 1.0mm; the accuracy can reach a frequency change of ±10~±50ppm under the operating temperature of -40~+150℃, meeting the needs of various fields such as consumer electronics products, network communications, and automotive applications. In terms of temperature-compensated quartz oscillators, its accuracy can reach ±0.5ppm. Micro-electromechanical sensing components focus on the layout of product structure design and packaging technology.

In addition, in the post-epidemic era, changes in social activities have accelerated the promotion of 5G networks, and the application of communication technology is rapidly entering the fields of home appliances, vehicles, and industries. In order to strengthen the depth and breadth of existing core products, the Company introduces semiconductor material thinning processing technology and packaging process, and applies it to ultra-high frequency chip process.

  1. R&D achievements in 2022:

Quartz components have completed the development of miniaturized 1.2mm×1.0mm 76.8MHz above quartz crystals. Its wafer adopts semiconductor material thinning processing technology, and has completed 1.6mm x 1.2mm, 2.0mm x 1.6mm size 5G communication product application series, and the temperature range can reach -40~125℃. Some specifications have started to send samples in the fourth quarter of 2022, quartz crystal oscillators and temperature-compensated quartz oscillators have completed 2.0mm x 1.6mm, 2.5mm x 2.0mm, 3.2mm x 2.5 and 2.0mm x 1.6mm wide temperature automotive application product line. The production and shipment of sensing components accounted for 9% of the total annual revenue in 2022.

  1. R&D projects:

A. Miniaturization and high precision

Using its semiconductor material thinning processing technology, the Company has promoted the miniaturization of product size to 1.2mm x 1.0mm, and will develop towards smaller specifications in the future. In 2023, it is expected to invest in the development of sensing quartz crystal 1.2mm x 1.0mm size packaging technology process, and optimize the accuracy and stability of existing quartz crystal series products.

B. High frequency and advanced oscillators

Based on the current production method of quartz wafers, the production technology in the frequency range of 1~50 MHZ is already mature. Of the Company’s existing mass production, the frequency is between in the range of 1~212.5MHZ and its production of high-frequency quartz components is mostly handled by frequency doubling. Thus, it is easy to create a phenomenon of chattering (Jitter), resulting in the loss of signal on the transmission (Loss). To solve this problem, the Company expects to actively develop high-frequency chips with fundamental frequency. It is not easy for the traditional technology to process high-frequency chips due to high defect rates, however. The thinning processing technology of semiconductor materials introduced by the company aims to improve the yield and stability for the purpose. Regarding 5G equipment and automotive applications, the Company expects to continue its development of high-unit price quartz oscillators such asVCXO,TCXO, LV-PECL/LVDS/HCSL, and towards miniaturization in the near future.

  1. 2022 operation plan summary

(1)Operation principles:

  1. Actively develop the market, deepen service quality, and cultivate customer relationships.
  2. Improve R&D technology, develop new products, and increase competitive advantage
  3. Abide by the quality policy, introduce green products, and win the trust of customers.
  4. Implement corporate governance, fulfill social responsibilities, and establish sustainable development.

(2)Expected sales volume:


 Unit: K/PCS 

Main products Production (purchase) quantity  Sales volume
Crystal resonator 1,088,242  1,180,221 
Crystal oscillator  4,233  14,143 
Others 120,024  227,322 
Total 1,212,499  1,421,686 


(3)Key production and sale policies:

  1. Build up intelligent production lines and strengthen product competitiveness, in order to improve the Company’s profitability.
  2. Implementing supply chain management, improving quality requirements, and introducing green products in order to obtain customers’ trusts.
  3. To develop international customers actively, to win orders extensively, and to deepen service quality, in order to increase market share.
  4. Strengthen internal management and decision-making in order to quickly respond to market demand and changes.


  1. The future development strategies of the Company, and the impacts of external competitive environment, regulatory environment and the overall business environment.

Looking forward to 2023, due to many negative impacts such as rising inflation, policy tightening, financial pressure and continuous adjustment of corporate inventories, the growth rate of global economy and trade will slow down compared with 2022. The Company will continue to observe changes in the application market environment of AI, 5G communications, automotive electronics and the Internet of Things, and properly adjust its business strategy, strengthen cost control and resource allocation, so as to avoid unnecessary operating waste.

I firmly believe that with the efforts of all colleagues and the support of all shareholders, Harmony Electronics will face various challenges with a steady business strategy in the new year. In addition, the Company will continue to promote environmental protection, social responsibility and corporate governance issues in order to become a sustainable development enterprise.

At last, best wishes for all of you!





- 意林行銷 -