ESPRESSIF SYSTEMS
CONTENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Contents
About Espressif 03 Management Report （Continued）
Business Model 15
Developer Community Content 16
Core Competitiveness 05 Ownership of Securities 17
Risks and Uncertainties 18
Business Highlights 06 Consolidated Financial Statements 19
(Unaudited)
Key Financial Data 06
Consolidated Balance Sheet 19
Key Financial Indicators 06
Consolidated Income Statement 21
Financial Analysis 07
Consolidated Cash Flow Statement 22
Management Report 08
Further Information 24
Business Strategy 08
Terms and Conditions of the Report 24
Key Products - IoT Chips 09
List of abbreviations 25
Key Products - Chip Matrix 10
Product Market Tenure 11
Key Products - M5Stack DevKits 12
Edge AI Strategy 13
ABOUT ESPRESSIF ESPRESSIF SYSTEMS Q1 2026 REPORT
Facts About Espressif
Espressif Systems (SSE: 688018.SH) is a leading fabless semiconductor company providing wireless connectivity
and edge intelligence solutions for IoT devices. The Company has expanded beyond chip supply to become a
platform enabler for hardware digitalization and intelligent transformation, supported by an integrated combination of
silicon, software, tools, and ecosystem resources.
Built around the ESP32 product family, which has emerged as a preferred and highly recognizable platform among
global developers, Espressif has established strong ecosystem momentum. A large and active developer community,
thousands of third-party software components, and long-term platform continuity drive sustained adoption.
Through this ecosystem-led approach, Espressif enables customers to build, scale, and continuously evolve
intelligent hardware products, positioning the Company to capture durable value as hardware digitalization and
intelligence continue to deepen globally.
Global IoT Chip In Wi-Fi MCU In AIoT Satisfied Active Ecosystem
Shipment Market Technology Customers Developers
(Cumulative) Worldwide
R&D R&D Employees Employee Female
Centers Employees Nationalities Employees
ABOUT ESPRESSIF ESPRESSIF SYSTEMS Q1 2026 REPORT
Build Smart with ESP32
As a global semiconductor innovator, we deliver high-performance RISC-V SoCs and comprehensive solutions with
integrated AI, in-house operating system, robust security, and seamless cloud integration—shaping the future of
smart, connected systems.
Al Agent Edge Al Co-processor Mesh Wi-Fi Sensing HMI Multimedia Cloud & Matter Security
Cloud &
Ecosystem
AI
AI & IoT
ESP-SR ESP-WHO ESP-DL
SDK Speech Recognition Image Recognition Deep Learning
IoT
ESP-Brookesia ESP-GMF ESP-loT-Solution
Al-Powered Ul Framework Audio&Video Processing Peripheral Integration
Operating In-House
System ESP-IDF
Official loT OS
Compilers & Tool Chains
Third-Party
IC Design Connectivity
Wireless Communication
Wi-Fi 7/6E/6 | 2.4/5/6 GHz Tri-band
Bluetooth 6 (LE)
IEEE 802.15.4
High-Speed Data Transmission
Computing
Core
AI FPU | Instruction Set Extensions
Multimedia ISP | H.264 Encoder | JPEG Codec
High-Speed Interfaces PCle | DDR | USB
CORE COMPETITIVENESS ESPRESSIF SYSTEMS Q1 2026 REPORT
Brand Awareness 100
ESP32 Google Trends
The ESP32 and Espressif brands have a strong sense of
recognition among users. This recognition has become a key
factor in our competitive advantage and success. Users identify
with the ESP32 brand due to its reliability, performance, and
versatility, which have been proven across various applications
and industries. This strong brand awareness not only fosters 25
customer retention but also attracts new users, thereby solidifying
Espressif's position in the market. 0
Exceptional IC Design Capability Espressif Google Trends
Espressif independently designs and develops its own chip
products, with core IPs being self-developed. These chips are
equipped with rich features, ensuring that Espressif’s products
stand out in the market and avoid the pitfalls of homogenized
competition. By controlling the entire design process, Espressif
can innovate rapidly and introduce unique functionalities that set
our products apart from competitors, providing a distinctive edge 25
in the IoT semiconductor industry.
Full-Stack Engineering Capability
Espressif possesses comprehensive engineering development capabilities that span from IP development to
complete chip design, operating systems, firmware, software frameworks, application solutions, hardware design,
edge AI, cloud, and apps. This full-stack engineering expertise allows Espressif to offer highly integrated solutions
that meet a wide range of customer needs. The ability to control and optimize every layer of the technology stack is
unique in the industry and enables Espressif to deliver superior products and services that are seamlessly integrated
and highly efficient.
Superior Cost-Effective and Stable Support
Espressif's products are known for their high performance and low cost, making them competitive in the market. We
provide the cost efficiency necessary to promote large-scale commercialization in downstream industries.
Additionally, we ensure the long-term availability of our products and offer stable and enduring software support,
ensuring that customers can rely on their investments for extended periods. This commitment to value and reliability
strengthens customer trust.
Extensive Developer Community Support
Espressif has garnered support from a vast community of professional engineers who are familiar with Espressif's
development platform and actively promote its value proposition. This large and engaged community not only aids in
the rapid adoption and dissemination of Espressif’s technologies but also contributes to continuous improvement
through feedback and shared knowledge. The robust community support amplifies Espressif's market presence and
enhances our reputation as a trusted and innovative leader in the industry.
BUSINESS HIGHLIGHTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Business Highlights
Key Financial Data
Three Months Ended Fiscal Year
CNY March 31, 2026 March 31, 2025 2025
Consolidated Statement of Income Data
Revenue 647,971,432 557,849,869 2,565,275,432
Gross profit 314,322,323 241,947,517 1,196,087,930
Selling expenses 23,147,827 17,019,921 81,799,952
General and administrative expenses 21,736,889 17,853,584 88,725,443
Research and development expenses 154,485,482 126,192,049 603,427,213
Net income 136,045,431 94,441,673 499,809,218
Net income attributable to Espressif 135,642,156 93,704,355 497,840,142
Earnings per share:
Basic 0.8160 0.6088 3.1520
Diluted 0.8160 0.6088 3.1358
Consolidated Cash Flow Data
Net cash provided by operating activities 3,417,302 74,972,387 522,622,032
Non-GAAP Adjustment
Stock-based compensation 6,526,170 5,309,168 43,878,803
Non-GAAP net income attributable to Espressif 142,168,326 99,013,522 541,718,945
March 31, 2026 December 31, 2025
Consolidated Balance Sheet Data
Working capital 3,542,304,356 3,518,352,994
Total assets 5,041,543,851 5,047,755,518
Long-term obligations 151,064,525 141,345,125
Total shareholders’ equity 4,527,483,104 4,489,877,928
N.B.: Due to the company's implementation of a capital reserve to equity conversion in 2025, the earnings per share for each reporting period have been recalculated
based on the adjusted share count.
Key Financial Indicators
Three Months Ended Fiscal Year
March 31, 2026 March 31, 2025 2025
Gross margin 48.51% 43.37% 46.63%
R&D-to-sales ratio 23.84% 22.62% 23.52%
EBITDA margin 24.19% 18.98% 22.41%
Net income margin 21.00% 16.93% 19.48%
Weighted ROE 3.01% 4.26% 17.33%
Number of Espressif employees 915 803 898
BUSINESS HIGHLIGHTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Financial Analysis
Revenue & Margin: Q1 revenue reached CNY 647.97 million (+16.16% YoY). Overall gross margin stood at 48.5%,
underpinned by 49.6% for IoT chips and 47.7% for modules/kits. This robust margin reflects the industry’s shift
toward "functionality-driven" growth, where our products serve as high-value development platforms.
Profitability & Resilience: Structurally, revenue growth experienced a temporary slowdown due to the
macroeconomic environment, while the expense side reflected front-loaded investments for mid-to-long-term
growth, resulting in a timing mismatch between the two. However, benefiting from a steady expansion in gross
margin, the company still achieved robust profit growth, demonstrating significant operational resilience.
Cash Flow & Inventory: Operating cash flow was lower than net profit due to a proactive inventory strategy. In
anticipation of potential price increases for key raw materials, we increased strategic stockpiling to lock in costs and
ensure supply stability, thereby enhancing delivery certainty for downstream customers. This deliberate mismatch is
expected to normalize as supply chain price volatility moderates.
ROE & Capital: The decline in ROE was a result of capital dilution following the new share issuance completed in Q3
Revenue by Area Revenue by Sales Top-5 Customer
in Q1 2026 Mode in Q1 2026 Concentration Rate
China's Mailand Rest of the World Direct Indirect 2021 2022 2023 2024 2025 2026Q1
Revenue by Product Category
Chips Modules & DevKits Others
Q1 2025 37.0% 62.1% 0.9%
Q1 2026 36.0% 63.3% 0.7%
Key Financial Indicators
Q1 2025 Q1 2026
Overall GM EBITDA SG&A as % of R&D as % of Net Income ROE (Q)
Margin sales sales Margin
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2025
Management Report
Business Strategy
Espressif Systems’ business strategy emanates from our service/product areas and our engagement with the
developer ecosystem.
Our product and service areas include AIoT chips, OS-level development environments, software tools, application
solutions, and value-added services, such as Cloud and Matter. The above-mentioned products ensure that we are
in the heart of numerous commercial AIoT applications in different markets, including smart home, consumer
electronics, industrial automation, healthcare, etc.
Products Solutions Value-added services
SoCs HMI Smart Audio Cloud
Displays Solutions service
Modules Matter
Solution
Face Low-Power
Recognition Solutions
DevKits
… …
OS-level development environments & software tools
Customers
Brands OEM/ODMs Module Houses Solution Providers Makers
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2025
Key Products - IoT Chips
Espressif Systems is a global leader in wireless connectivity SoCs and AIoT solutions. Since launching our first Wi-Fi
MCU in 2014, we have continuously expanded our product portfolio and deepened our technology stack. Today,
Espressif offers a comprehensive range of self-developed wireless SoCs, covering Wi-Fi 4/6/6E, Bluetooth 6 (LE) ,
Bluetooth Classic (BR/EDR), Thread, Zigbee, and Matter protocols, enabling diverse smart connectivity applications
across consumer, industrial, and commercial domains.
In recent years, Espressif has made notable progress in the development of advanced edge computing platforms.
Our RISC-V-based SoCs now integrate AI accelerators, and multimedia processing capabilities, enabling efficient
deployment of voice, vision, and large language model (LLM)-based applications on cloud.
Espressif's competitive edge lies in its end-to-end in-house technology development, including RF components,
connectivity IPs, RISC-V processor cores, secure boot and OTA frameworks, real-time operating systems, AI
toolchains, and developer toolkits. This vertical integration enables us to deliver consistent software and hardware
experiences across platforms, ensuring seamless development, high integration, and long-term support for our
customers.
To simplify product adoption, we also offer a wide range of IoT modules and development kits, fully supported by
Espressif’s software ecosystem and global community. This helps customers accelerate time-to-market while
optimizing their supply chain through direct technical and logistical support from Espressif.
Key Technologies
Wi-Fi Technologies Other Wireless Technologies
Wi-Fi 7 Bluetooth 6 (LE)
Tri-Band Wi-Fi 6E Bluetooth Classic (BR/EDR)
Connectivity 2×2 MU-MIMO Thread
Technical Depth
Dual-Band Wi-Fi 6 Zigbee
Wi-Fi 4
RISC-V Cores AI Related
Computing 96/240/400/500MHz FPU | Instruction Set Extensions
ISP | H.264 Encoder | JPEG Codec
Technical Breadth In progress
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Key Products - Chip Matrix
AI AI AI
ESP ESP32 ESP32 ESP32
H.264 encoding
Function-
Driven ESP32
ESP32 - S2
ESP32
H4 ESP32 - H4
S2
ESP32
C5 ESP32 - C5
E22 ESP32 - E22
ESP32
C6 ESP32 - C6
ESP 8266 C61 ESP32 - C61
ESP32
C3 ESP32 - C3
Connectivity-
Driven ESP32
H21 ESP32 -H21
ESP32
C2 ESP32 - C2 1x Core @96 MHz
ESP32
H2 ESP32 - H2
Legacy Growth Emerging / Sampling
Wi-Fi 4 Bluetooth
Wi-Fi 6 Thread
N.B.: Wi-Fi 6E Zigbee
All products shown above are 32-bit MCU-based chips.
Matter Ultra-Low Power
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Product Market Tenure
Annual Revenue Trend Legacy Growth Emerging Sampling
ESP32-S31
ESP32-E22
ESP32-H21
ESP32-H4
ESP32-P4 2 YEARS
ESP32-H2 4 YEARS
ESP32-C61 2 YEARS
ESP32-C5 2 YEARS
ESP32-C6 4 YEARS
ESP32-C2 5 YEARS
ESP32-C3 6 YEARS
ESP32-S3 6 YEARS
ESP32-S2 7 YEARS
ESP32 (Original) 11 YEARS (SINCE 2016)
ESP8266 13 YEARS (SINCE 2014)
Product Lifecycle Classification
• Sampling: The product has completed development and entered the sampling phase, undergoing customer
design-in and validation.
• Emerging: The product has achieved initial mass production and begun generating revenue, though overall
scale remains limited.
• Growth: The product enters a ramp-up phase, making a significant contribution to revenue growth.
• Legacy: The product has reached a stable shipment scale, with sales trending flat or gradually declining; certain
product may enter the later stage of their lifecycle.
• EOL: End of Life. No products have reached this stage yet.
Market Tenure as a Core Asset
In the IoT industry, a product’s market tenure serves as a critical indicator of credibility. It reflects long-term validation
and stable performance across complex application environments—reliability that cannot be replicated by speed or
short-term iteration alone.
Long-Tail Value
Products within the IoT ecosystem are capable of sustaining revenue contributions over extended periods.
Unlike consumer mobile devices, IoT chips typically follow a "Slow Burn, High Retention" model where reliability is
the primary purchasing driver.
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Key Products - M5Stack Development Kits
Espressif acquired a majority stake in M5Stack in 2024 Q2. M5Stack is renowned for its innovative approach to
hardware development and offers a modular, open-source platform that simplifies the creation of IoT and embedded
system solutions, greatly enhancing deployment efficiency. The M5Stack ecosystem is built around its flagship main
control module, powered by Espressif’s all ESP32 series of chips, highlighting the deep technical synergy between
the two companies.
Beyond its hardware prowess, M5Stack has cultivated an exceptionally vibrant global developer community,
commanding high brand mindshare within the ecosystem. With an impressive pace of launching one new hardware
product every week and a diversified portfolio of over 400 SKUs, M5Stack enables developers to rapidly prototype
and iterate. This vast community serves as a continuous validation engine, where grassroots innovation frequently
translates into mature, market-ready solutions.
M5Stack’s modular and standardized development kits significantly lower the barrier to entry for
students, educators, and creative developers. Its plug-and-play design makes embedded systems and
IoT development more accessible, supporting classroom adoption, STEM programs, and hands-on
experimentation.
Developers who gain experience with Espressif-based platforms during their education or prototyping phase are
more likely to continue using the same ecosystem in future professional or commercial projects.
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Edge AI Strategy
In recent years, Espressif has expanded its software capabilities around AI-enabled IoT applications. The Company
has released multiple on-device AI frameworks, including ESP-WHO (image recognition), ESP-DL (deep learning
inference), and ESP-SR (speech recognition), as well as cloud-side tools such as the ESP Private Agents Platform to
support large-model-based applications and device–cloud collaboration. These components enable customers to
deploy perception, interaction, and autonomous operation features on existing device categories with limited
additional system complexity.
On the hardware side, the Company observes that the IoT industry is transitioning from a connectivity-driven phase
to a capability-driven phase. Historically, device value was primarily determined by the number of connected nodes.
As local computing performance improves, devices increasingly undertake recognition, decision-making, and
continuous operation tasks. As a result, value is shifting toward the functional richness achievable per node rather
than connectivity scale alone.
In response to this shift, the Company has identified edge-side capability enhancement as a long-term
development direction. While maintaining advantages in cost efficiency and power consumption, next-generation
products will progressively improve local execution capability and supporting software environments. This allows
customers to expand functionality within existing device form factors without materially increasing system
complexity.
The Company expects the adoption of edge intelligence to occur gradually, with commercialization driven by
increasing feature penetration rather than a single product replacement cycle. Accordingly, future business growth
is expected to expand from shipment volume alone toward value growth per device node. As devices undertake
more tasks over their lifecycle, customers are placing greater emphasis on platform stability, compatibility, and long-
term support.
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
AI Solutions
AI COMPUTING EDGE AI
Large Language Models (LLM) ESP-WHO Image Recognition Framework
Espressif enables edge devices to access advanced AI A vision framework supporting face detection, recognition,
capabilities through secure, low-latency connections to liveness, and gestures. It delivers real-time edge inference
cloud-based large language models. for smart cameras and access control systems.
ESP Private Agents Platform ESP-SR Speech Recognition Framework
The ESP Private Agents Platform enables IoT device A low-power speech solution integrating Acoustic Front-
makers to deploy AI agents entirely within their own AWS End (AFE), wake word, and command recognition. Enables
environments. With a ready-to-use runtime, flexible LLM fast, accurate, and ready-to-use voice interaction for edge
support, and a unified dashboard, it simplifies agent devices.
development and lifecycle management for secure,
scalable IoT products.
ESP-DL Deep-Learning Library for AIoT
A lightweight neural network inference framework
optimized for Espressif ESP-series SoCs. It enables
efficient on-device AI by providing APIs to load, debug,
and run AI models with low memory and high
performance.
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Business Model
Business-to-Developer-to-Business (B2D2B)
The market for IoT is truly diverse, encompassing applications for smart homes, consumer electronics, industrial
automation, tools and equipment, smart agriculture, healthcare, energy control, and the Internet of Vehicles. Given
this high degree of market fragmentation, the company’s B2D2B business model provides significant competitive
advantages.
The Developer Platform Model operates on a fundamental multiplier: total demand is driven by the volume of design-
in projects and the longevity of their lifecycles. By consistently increasing the number of active design projects, the
platform establishes a long-term foundation for recurring demand. Each project integration represents a multi-year
commitment to the platform’s technology, ensuring a predictable and stable growth trajectory.
The scaling of design projects naturally leads to increased industry fragmentation and a broader range of application
scenarios. As the platform expands, its technology penetrates a diverse array of sectors, moving beyond specialized
markets into a wide variety of commercial and industrial uses. This horizontal expansion allows the platform to
capture value across multiple independent growth drivers simultaneously.
This diversified footprint serves as a strategic hedge against systemic risk. By distributing the platform’s presence
across a vast range of industries, overall performance becomes increasingly decoupled from the cyclical volatility of
any single sector. Consequently, the business achieves greater structural resilience, maintaining steady performance
even when specific market segments face temporary downturns.
B2D2B Model
Core Chip Software Tools
Smart Home Smart Lighting Industrial Control Charging Pile
Module Branch B
(Product Prototype)
Community
Portable Energy Storage
Branch A
(DIY
Enthusiast)
Development Board
(DevKit) Photovoltaic Inverter
Smart Agriculture 3D Printer Smart Internet of Vehicles
Healthcare
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Developer Community Content
Cumulative Number of
GitHub ESP32 Projects 150 K
BOOKS
Global Code Hosting Platform Social Networking Site Developer-written books
ESP32 and ESP8266 ESP32 Group Members Covering more than 10
Projects languages
Daily Increase on GitHub
ESP32 Projects
Chinese Video Sharing Platform Global Video Sharing Platform 222
Most Viewed ESP32 Most Viewed ESP32 Most Viewed ESP32
Video (2026) Short (2026) Video (2026)
Always a on Social Media
Posted on 4 Apr 2026 Posted on 11 Apr 2026 Posted on 13 Apr 2026 Posted on 12 Apr 2026
【2026祖娅纳惜??会】蓝??乐吧唧 I made a Tamagotchi for my AI agent This is how the smoking works
开箱视频 so I know if it’s stuck generally:
液晶ドールアイが出来た！意外と違和
感なく楽しめそう。 1、本来想做成伪开箱视频，但是想加? I’ve been running AI agents locally with The pellets are loaded into a……
いろんなデザインを試したいなぁ～ 视频的东?实在是太多了所以后?就跑题 OpenClaw, and wanted a simple way to
視線移動も出来ます！ 了…… see what they’re doing without
丸形液晶モジュール+ESP32の構成で constantly checking logs.
す。
So I built a small desk device using a
XIAO ESP32-C3 that visualizes……
https://x.com/ric_orna/status/
https://www.bilibili.com/video/
BV1yqQABLEQ7
https://x.com/DancingDoll_rz/status/
Searched on 14 Apr 2026
comments/1sk90we/
Posted on 9 Apr 2026 i_made_a_tamagotchi_for_my_ai_agent
_so_i_know_if/
EleksCava 固件 v2.0.7 更新 !
Posted on 11 Mar 2026 这次是?个?版本，?乎重做了所有
界? "
# 两种全新?情布局 Posted on 6 Mar 2026
Build The Smallest ESP32 Brushless
- BlockClock 模式：全?底?字显
Rocket Drone | ESP-BLAST
示，复古电?屏?格
- Ticker 模式：左侧代码?板 + 右侧
This is the ESP-BLAST - a DIY ESP32
价格涨跌
Mini Rocket Drone you can build for
- 加密货币和股票都?持，配置??
crazy fast first-person-view flights
键切换
exceeding 100 km/h.
……
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Ownership of Securities
Basic information of securities
Share types Ordinary share
Share capital 167,143,010 (as of March 31, 2026)
Listing Shanghai Stock Exchange (SSE)
Ticker 688018.SH
Listing Date 2019-07-22
Shareholder Structure as of March 31, 2026
Shareholder Share Numbers Percentage (%)
Espressif (Hong Kong) Investment Ltd. 61,210,572 36.62
Hong Kong Securities Clearing Company Limited 5,275,688 3.16
NSSF Portfolio 114 3,004,979 1.80
Wisdomshire Asset Management Co., Ltd. - Wisdomshire Youfu
Private Equity Securities Investment Fund No.1
CITIC Securities Co., Ltd. – Harvest SSE STAR Market Chip Tradable
Open-ended Index Securities Investment Fund
Wisdomshire Asset Management Co., Ltd. - Wisdomshire Youfu
Private Equity Securities Investment Fund No.3
Shinvest Holding Ltd. 1,866,500 1.12
China Universal AM – China Life – Participating Insurance –
Balanced Equity Portfolio (Single Asset Management Plan)
Shanghai Letun Enterprise Management Partnership (Limited
Partnership)
CZBank-Bosera Select Quant Multi-Factor Equity Fund 1,449,911 0.87
Top 10 shareholders 82,089,816 49.13
Espressif Systems (Shanghai) Co., Ltd. Repurchase Special
Securities Account
Other public shareholders 83,613,020 50.01
Total of outstanding shares 167,143,010 100.00
MANAGEMENT REPORT ESPRESSIF SYSTEMS Q1 2026 REPORT
Risks and Uncertainties
Financial Risk
The Company performs periodic credit evaluations of its customers’ financial condition
and generally requires of its customers no collateral. The Company provides an
allowance for expected credit losses, based on the net amount expected to be
collected on such receivables. Losses have not been significant for any of the periods
presented in this report.
R&D Risk
Espressif’s research and development strategy is focused on leveraging new
technologies for the creation of innovative AIoT products. Any delays or changes in
the development of these technologies by our industry partners, or a failure of our
products to achieve market acceptance, could compromise our competitive position.
Competitors
As the market for AIoT products grows, we face an increasing antagonism from
relatively large competitors, such as Realtek, MediaTek, Infineon, NXP, Qualcomm, TI
Silicon Labs, Nordic, and others. Intense competition from current players may reduce
our product sales and market share.
Suppliers
A significant portion of the Company’s products is fabricated by the Taiwan
Semiconductor Manufacturing Company Limited (TSMC). The inability of TSMC to
deliver wafers to the Company in a timely manner could impact the production of the
Company’s products for a certain period of time, which could have an adverse effect
on the Company’s business, financial condition, results of operations and cash flow.
Customers
The Company sells directly to end customers, distributors, solution providers and
contract manufacturers. Our customers are a mix of several big customers and
numerous small customers. The concentration ratio for our top-five customers was
CONSOLIDATED FINANCIAL STATEMENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Consolidated Financial
Statements
Consolidated Balance Sheet (unaudited)
CNY March 31, 2026 December 31, 2025
Assets
Current assets:
Cash and cash equivalents 1,061,728,185 1,024,792,840
Held for trading financial assets 703,304,644 876,009,608
Notes receivable 54,255,028 65,534,507
Accounts receivable, net 328,889,686 298,106,030
Accounts receivable financing
Prepayments 16,533,470 19,427,100
Other receivables 9,648,898 11,439,963
Including: Interest receivable
Inventories 740,194,524 627,637,513
Other current assets 990,746,143 1,011,937,898
Total current assets 3,905,300,577 3,934,885,459
Non-current assets:
Debt investment 211,310,600 210,430,400
Investment in other equity assets 42,036,070 42,036,070
Other non-current financial assets 41,937,416 41,937,416
Fixed assets 568,700,215 556,813,866
Right-of-use assets 34,215,240 29,091,243
Intangible assets 25,614,200 26,662,076
Goodwill 74,654,024 74,654,024
Long-term deferred expenses 21,405,594 22,753,695
Deferred income tax assets 116,369,916 108,491,271
Other non-current assets
Total assets 5,041,543,851 5,047,755,518
CONSOLIDATED FINANCIAL STATEMENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Consolidated Balance Sheet (unaudited)
CNY March 31, 2026 December 31, 2025
Liabilities & Shareholders’ Equity
Current liabilities:
Short-term loan
Accounts payable 197,451,769 187,528,762
Contract liabilities 33,952,016 23,381,055
Payroll payable 68,134,418 157,619,024
Taxes payable 5,337,004 2,581,791
Other payable 48,356,548 37,303,747
Including: Interest payable
Non-current liabilities due within one year 7,780,297 6,944,668
Other current liabilities 1,984,169 1,173,418
Total current liabilities 362,996,222 416,532,465
Non-current liabilities:
Lease liabilities 27,861,631 23,701,708
Provisions 624,792 636,582
Deferred income tax liabilities 122,578,103 117,006,835
Total liabilities 514,060,747 557,877,590
Owners’ equity (or shareholders' equity):
Share capital 167,143,010 167,143,010
Capital reserves 3,047,112,218 3,040,623,359
Less: Treasury stock 160,168,823 67,433,448
Other comprehensive income 5,442,685 17,636,423
Surplus reserves 123,024,049 123,024,049
Retained earnings 1,313,163,078 1,177,520,921
Total Espressif shareholders’ equity 4,495,716,216 4,458,514,314
Non-controlling interests 31,766,888 31,363,613
Total shareholders’ equity 4,527,483,104 4,489,877,928
Total liabilities and shareholders' equity 5,041,543,851 5,047,755,518
CONSOLIDATED FINANCIAL STATEMENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Consolidated Income Statement (unaudited)
Three Months Ended
CNY March 31, 2026 March 31, 2025
Revenue 647,971,432 557,849,869
Cost of Revenue 333,649,109 315,902,352
Gross Profit 314,322,323 241,947,517
Taxes and surcharges 2,159,062 1,709,774
Selling expenses 23,147,827 17,019,921
General and administrative expenses 21,736,889 17,853,584
Research and development expenses 154,485,482 126,192,049
Financial expenses -736,725 -654,376
Including: Interest expenses 270,263 1,028,913
Interest income 5,486,153 5,004,324
Add: Other income 9,732,851 7,947,506
Investment income (mark"-" for loss) 7,998,830 4,599,900
Income from changes in fair value (mark"-" for loss) 1,813,119
Credit impairment losses (mark"-" for loss) 33,916.56
Assets impairment losses (mark"-" for loss) -669,179 -103,424
Assets disposal income (mark"-" for loss) 3,770 -15,558
Operating Income 132,443,095 92,254,989
Add: Non-operating revenue 2,120,470 330,000
Less: Non-operating expenses 40,091 47,024
Income before income taxes 134,523,474 92,537,965
Provision (benefit) for income taxes -1,521,957 -1,903,708
Net Income 136,045,431 94,441,673
Net Income attributable to non-controlling interests 403,275 737,319
Net Income attributable to Espressif 135,642,156 93,704,355
Earnings per share
Basic 0.8160 0.6088
Diluted 0.8160 0.6088
N.B.: Due to the company's implementation of a capital reserve to equity conversion in 2025, the earnings per share for each reporting period have been recalculated
based on the adjusted share count.
Three Months Ended
CNY March 31, 2026 March 31, 2025
Net Income 136,045,431 94,441,673
Other comprehensive income (loss), after tax
Changes to the fair value of investment in other equity instruments
Currency translation reserves -12,193,738 -1,047,794
Other comprehensive income (loss) -12,193,738 -1,047,794
Other comprehensive income (loss) attributable to
non-controlling interests
Comprehensive income 123,851,693 93,393,879
Comprehensive income attributable to non-controlling interests 403,275 737,319
Comprehensive income attributable to Espressif 123,448,418 92,656,560
CONSOLIDATED FINANCIAL STATEMENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Consolidated Cash Flow Statement (unaudited)
Three Months Ended
CNY March 31, 2026 March 31, 2025
Operating Activities
Cash from sales of merchandise and provision of services 703,424,011 584,584,589
Tax refund 46,388,179 14,830,187
Other received cash related to operational activities 42,746,902 78,966,606
Subtotal of cash inflow from operational activities 792,559,092 678,381,381
Cash paid for merchandise and services 485,706,024 359,446,334
Cash paid to and for employees 236,975,117 197,026,278
Cash paid for taxes and surcharges 8,763,506 18,939,933
Other paid cash related to operational activities 57,697,142 27,996,449
Subtotal of cash outflow from operational activities 789,141,789 603,408,994
Net cash provided by operating activities 3,417,302 74,972,387
Investing activities
Cash arising from the disposal of investments 890,534,313
Cash arising from investment income 900,000
Net cash arising from the disposal of fixed assets, intangible assets and other 15,770 7,767
long-term assets
Other received cash relating to investment activities 1,119,053 578,050
Subtotal of cash inflow from investment activities 892,569,136 585,817
Cash paid for the purchase and construction of fixed assets, intangible assets and 32,191,289 14,486,027
other long-term assets
Cash paid for investments 714,000,000
Net cash paid for acquisition of subsidiaries and other business units
Other paid cash relating to investment activities 300,000
Subtotal of cash outflow from investment activities 746,191,289 14,786,027
Net cash provided by investment activities 146,377,847 -14,200,210
Financing activities
Cash arising from the issuance of common stock 89,493
Including: Cash arising from subsidiaries absorbing investments by minority
shareholders
Cash received from borrowings 222,600,000
Subtotal of cash inflow from financing activities 89,493 222,600,000
Cash paid to repay debt 500,000
Cash paid for the distribution of dividends and profits, or payment of interests 653,056
Including: dividends and profits paid to minority shareholders by subsidiaries
Other paid cash relating to financing activities 95,895,057 3,787,400
Subtotal of cash outflow from financing activities 95,895,057 4,940,456
Net cash provided by financing activities -95,805,564 217,659,544
Impact of fluctuation in exchange rates on cash and cash equivalents -18,555,188 -407,168
Net increase in cash and cash equivalents 35,434,398 278,024,554
Add: Cash and cash equivalent at the commencement 1,018,023,771 667,632,307
of the period
Cash and cash equivalents at the end of the period 1,053,458,169 945,656,860
CONSOLIDATED FINANCIAL STATEMENTS ESPRESSIF SYSTEMS Q1 2026 REPORT
Consolidated Cash Flow Statement
- Indirect Method (unaudited)
Three Months Ended
CNY March 31, 2026 March 31, 2025
Additional information
Net income 136,045,431 94,441,673
Adjustments to cash provided by operating activities, for the purpose of
reconciling net income:
Add: provision for the impairment of assets 669,179 103,424
Credit impairment provision -33,917
Depreciation of fixed assets 15,965,429 6,028,171
Depreciation of right-of-use assets 2,097,102 3,081,834
Amortization of intangible assets 1,047,876 1,047,876
Amortization of long-term prepaid expenses 2,832,006 2,162,637
Losses on disposal of fixed assets, intangible assets and other long- -3,770 15,558
term assets (mark"-" for income)
Losses on scrapping of fixed assets (mark"-" for income) 6,642 1,631
Losses on fair value changes（mark"-" for income） -1,813,119
Financial expenses（mark"-" for income） 4,324,405 4,016,817
Losses on investment（mark"-" for income） -7,998,830 -4,599,900
Decrease on deferred income tax assets（mark”-" for increase） -7,913,127 -14,944,646
Increase on deferred income tax liabilities（mark"-" for decrease） 5,571,268 3,922,770
Changes in operating assets and liabilities:
Decrease in inventories（mark"-" for increase） -116,334,614 12,803,322
Decrease in operational receivables（mark"-" for increase） 16,812,834 -28,901,421
Increase in operational payables（mark"-" for decrease） -54,383,664 -9,516,527
Others 6,526,170 5,309,168
Net cash flow provided by operating activities 3,417,302 74,972,387
FURTHER INFORMATION ESPRESSIF SYSTEMS Q1 2026 REPORT
Further Information
Terms and Conditions of the Report
Responsibility Statement
The Board of Directors, and the executive management of the Company warrant that the contents of this report are
true, accurate and complete, and do not contain any false information, misleading statements or material omissions,
severally and jointly accepting any legal responsibility thereof.
Shanghai, 20 April 2026
Espressif Systems
Board of Directors Executive Management
Teo Swee Ann Teo Swee Ann
Founder and Chairman Founder and CEO
Ng Pei Chi Wang Jue
Information Technology Director Board Secretary
Wang Jue Shao Jingbo
Board Secretary Financial Director
Teo Teck Leong
Shareholder-elected
Chen Myn
Independent Director
Lee Kian Soon
Independent Director
Leong Foo Leng PRESSIF
ES
Independent Director
Declaration
Forward-looking Statements
SY
STE MS
This report contains forward-looking statements and/or assessments about the business,
financial condition, performance and strategy of the Espressif Group. These statements and/or
assessments are based on assumptions and management expectations resting upon currently
available information and current estimates. These are subject to a multitude of uncertainties
and risks, many of which are partially or entirely beyond Espressif’s control. Espressif’s actual
business development, financial condition, performance and strategy may, therefore, differ from
what is discussed in this report.
FURTHER INFORMATION ESPRESSIF SYSTEMS Q1 2026 REPORT
List of abbreviations
AI Artificial Intelligence
AIoT Artificial Intelligence and Internet of Things
Bluetooth LE Bluetooth Low Energy
CEO Chief Executive Officer
EBITDA Earnings Before Interest, Taxes, Depreciation and Amortization
Espressif ESPRESSIF SYSTEMS (SHANGHAI) CO., LTD.
G&A General and Administrative
GM Gross Margin
HMI Human-Machine Interaction
IC Integrated Circuit
IoT Internet of Things
LLM Large Language Model
MCU Microcontroller Unit
OBD On-Board Diagnostics
R&D Research and Development
RF Radio Frequency
RISC-V Reduced Instruction Set Computer-V
ROE Return on Earnings
SG&A Selling, General and Administrative
SH Shanghai
SoCs System on Chips
YoY Year-on-Year
Investor Relations Social Media
ir@espressif.com twitter.com/EspressifSystem
facebook.com/espressif
Official Platforms linkedin.com/company/espressif-systems
www.espressif.com youtube.com/EspressifSystems
blog.espressif.com instagram.com/espressif_systems_official
github.com/espressif bilibili.espressif.com
esp32.com
Copyright 2026 Espressif Systems (Shanghai) Co., Ltd. All rights
reserved. All trade names, trademarks and registered trademarks
mentioned in this document are the property of their respective
owners, and are hereby acknowledged. The term “Espressif” refers to
Espressif Systems (Shanghai) Co., Ltd. and/or its subsidiaries. This
report is written in both Chinese and English. In case of any
discrepancies between Chinese and foreign interpretations, the
Chinese version shall prevail.
All amounts presented in these condensed Consolidated Financial
Statements are shown in CNY unless stated otherwise. Slight
discrepancies between the amounts presented may occur due to
rounding.
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