VTech Holdings (“VTech”) reported audited results for the year ended 31 March 2026.

Revenue and Profitability • Group revenue declined 6.9 % to USD 2.03 billion, reflecting lower sales in all regions and across Electronic Learning Products (ELPs), Telecommunication (TEL) products and Contract Manufacturing Services (CMS). • Gross profit slipped 3.4 % to USD 663.40 million, but gross margin widened 1.2 percentage points to 32.7 % on cheaper materials, a stronger product mix, firmer pricing, favourable euro/US-dollar movements and lower freight costs. • Operating profit fell 9.4 % to USD 171.00 million; operating margin eased to 8.4 % (FY 2025: 8.7 %). • Profit attributable to shareholders dropped 14.5 % to USD 134.10 million, while basic EPS decreased to 52.9 US cents (FY 2025: 62.0 US cents). • Effective tax rate rose to 19.6 % (FY 2025: 15.4 %) after Hong Kong adopted the OECD 15 % minimum-tax regime.

Dividend A final dividend of 36.0 US cents per share is proposed, bringing the full-year payout to 53.0 US cents (FY 2025: 61.0 US cents). The dividend represents a 100 % payout ratio and is scheduled for payment on 7 August 2026, subject to shareholder approval on 23 July 2026.

Financial Position and Cash Flow • VTech remained debt-free, ending the period with USD 264.00 million in cash and deposits (31 Mar 2025: USD 335.60 million). • Net cash from operations fell 45.0 % to USD 123.90 million, primarily due to higher inventory and working-capital outflows. • Inventories rose to USD 402.90 million (31 Mar 2025: USD 360.80 million), equal to 128 days of cost of sales (FY 2025: 106 days). • Capital expenditure totalled USD 31.30 million, financed entirely from internal resources. • Shareholders’ equity increased marginally to USD 647.30 million; book value per share remained at roughly USD 2.55.

Segment and Geographic Performance Revenue by geography: – Europe: USD 899.90 million (-6.3 %) – North America: USD 811.60 million (-9.1 %) – Asia-Pacific: USD 294.70 million (-2.1 %) – Other Regions: USD 21.30 million (-5.3 %)

Revenue by product line: – CMS: USD 830.80 million (-10.2 %) – ELPs: USD 782.50 million (-5.7 %) – TEL products: USD 414.20 million (-1.9 %)

Operating profit by region: – North America: USD 70.60 million – Europe: USD 69.30 million – Asia-Pacific: USD 26.40 million – Other Regions: USD 4.70 million

Cost Structure • Selling and distribution expenses edged up to USD 319.60 million and represented 15.8 % of revenue (FY 2025: 14.6 %) due to higher promotional spend versus lower sales. • R&D spending fell 9.8 % to USD 82.90 million, remaining 4.1 % of revenue. • Administrative and other operating expenses fell 3.0 % to USD 88.20 million; foreign-exchange loss widened to USD 2.60 million (FY 2025: USD 1.10 million).

Tariff and Tax Matters The group has lodged objections to Hong Kong Inland Revenue Department additional assessments totalling USD 14.60 million and purchased tax-reserve certificates of USD 32.30 million. In the US, the Court of International Trade ordered refunds of tariffs imposed under IEEPA; VTech has yet to recognise any receivable due to uncertainty over timing and amount.

Outlook Highlights (Management Commentary) Management expects Group revenue to grow in FY 2026/27 as ELPs and TEL products recover and CMS remains steady, although gross margin is projected to contract amid rising component costs.

VTech marks its 50th anniversary in 2026 and continues to invest in capacity expansion in Malaysia (doubling capacity by mid-2027) and its new facility in Mexico to enhance geographic diversification.