April 16, 2024

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[THE INVESTOR] Fingerprint module maker CrucialTec said it hopes to turnaround next year as its struggling Chinese business has started to get back on track in line with the thawing relations between Korea and China.

The Korean firm saw its sales in China drop from 49.1 billion won (US$45.20 million) in the first quarter last year to 5.3 billion won in the third quarter. China is one of its core markets accounting for more than half the overall revenue. Its Chinese sales, however, continued to slide as tensions between Korea and China peaked over the deployment of THAAD missile defense system.

Sony’s Xperia Z5 features CrucialTec’s fingerprint module in the power button situated on the right-hand side. (CrucialTec)

Most Chinese partners ended their partnership with CrucialTec fearing government penalties for doing business with Korean firms. The tensions are easing, as both nations said they are committed to improving relations. The Korean firm has also started receiving new supply orders from Chinese smartphone makers, such as Huawei.

The biometric module firm will provide 3.5 million fingerprint modules, worth 14 billion won, for Huawei’s flagship smartphone Mate 10.

“The new contract with the Chinese smartphone firm will likely be a turning point for CrucialTec,” an official from the Korean firm said.

In addition to efforts to improve its Chinese business, CrucialTec will reinforce its partnerships with global smartphone firms, such as Sony, Fujitsu, Kyocera, and Google, to develop premium products.

“The company is now in a recovery mode after struggling with fierce competition and some external reasons,” said Kim Jong-bin, CEO of the firm.

“It will overcome difficulties by achieving a turnaround next year.”

By Kim Young-won (wone0102@heraldcorp.com)