ZKTECO CO., LTD.
2022 Annual Report
Announcement No.: 2023-033
April 2023
Innovation Traversing the Cycle
A Letter to Shareholders
2022 is the first year of listing of ZKTECO.
We are well aware that listing is a new starting point for the development of ZKTECO, but we have been given
higherexpectationsbyourshareholders.TheoriginalintentionandidealofZKTECOstaffgoingpublicistoachieve
sustainable developmentandbecome a respected innovative global enterprise in the field of "multimodal biometrics
and multimodal computer vision". On behalf of the Board of Directors, I would like to express sincere gratitude to
all colleagues, users, partners, especially institutional and individual investors of the Company!
As of December 31, 2022, ZKTECO has nearly 4,000 global employees, including over 1,100 overseas
employees, 95% of whom are local people. There are 42 branches and subsidiaries in China, covering major
provinces and regions. There are 40 subsidiaries overseas, and the Company's products are sold in more than 100
countries and regions worldwide. We have established R&D centers in Bangalore, Xiamen, Dalian, and Dongguan
and Shenzhen, with over 1,100 R&D personnel. We have established manufacturing centers in China and Thailand,
and invested in the construction ofthe "AmericanManufacturing FactoryConstructionProject" in theUnitedStates.
In 2022, ZKTECO achieved a consolidated operating revenue of over RMB 1.9 billion, which is basically the same
as in 2021; the net profit attributable to the parent company exceeded RMB 190 million, an increase of 12.47%
compared to the same period last year. In the current complex international environment and macroeconomic
situation, overseas business has achieved stable growth, covering the gaps in insufficient domestic business growth
and ensuring the overall business stability.
Innovation Traversing the Cycle
We often say that not investing in original R&D means building a house in someone else's house. No matter
how big your business is, it will be someone else's sooner or later. Innovation driving is the driving force behind the
development of ZKTECO. In 2022, we invested nearly RMB 190 million in R&D, accounting for 9.8% of the
Company's operating revenue.
ZKTECO is engaged in the core algorithm research and entrance scene empowerment, digital identity
authentication, smart office and other businesses combining multimodal biometrics and computer vision.
ZKTECO'stechnicalteamhasdevelopedcoretechnicalcapabilitiesintechnologiessuchassmalldata,multitasking,
and multimodality after years of technical accumulation. In 2022, we combined zero sample, single sample, and
small sample learning to construct a relatively unified model, and also established a multimodal artificial
intelligence (AI) research and direction of "small data and multitasking". Now, I would like to report on our
strengthened core capabilities and platform R&D over the past year:
1.Our technicalteamcontinues to investin theresearch ofmultimodalhybrid biometricrecognition algorithms:
combining traditional pattern recognition with AI algorithms, utilizing blockchain technology to unify physical and
digital iris, physical and digital fingerprint, physical and digital palm vein, physical and digital human image related
physical biometric features with digital identity recognition in two dimensions, and conducting in-depth research
on electronic payment hardware wallets.
2. We have made a substantial breakthrough in multimodal small sample offline computer vision. We have
upgraded from the traditionalbiometric "Who are you?" to "I not only know who you are, but also can push services
for you, interact with you according to the scene, and provide value-added services through the cool interactive
experience of digital consumers." Our new generation of digital signage is about to be loaded with ZKTECO based
BioCV pre AI capability, which empowers smart retail and catering scenarios.
3. In Bangalore, India and Xiamen, we have collaborated with Amazon to develop the next-generation Internet
of Things (IoT) platform Minerva, which we call the Minerva Platform. With its powerful End-Edge-Cloud
capabilities, it showcases excellent digital service capabilities for devices, phones, cloud services, and third-party
ecosystems. ZKTECO Interconnection, ZKTECO Cloud Commerce, and ZKTECO Cloud Chain based on the IoT
platform base have been launched.
Adhering to Globalization Without Wavering
Some people say that globalization has come to an end, but we have to say that the 2.0 version of globalization
has just begun, and new opportunities for innovation/intelligent manufacturing/services to go global have arrived.
Only by possessing a modern governance system, strengthening core competitiveness and comprehensive
capabilities,focusingonlong-termdevelopment,valuingstakeholderrelationships,complianceandtrustworthiness,
and coordinating risk management a
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