On the evening of September 17, FG Optics Inc. made an announcement stating its plan to redirect approximately 110 million yuan from its remaining raised funds towards two key initiatives: the industrialization project of multi-domain precision optical components and the R&D project of high-performance aerospace optical lenses.

As detailed in the announcement, the precision optical components project envisions a total investment of 87.0416 million yuan, with 80.3536 million yuan sourced from the leftover raised funds. The construction will take place across two factory sites in Mawei and Fuqing, Fuzhou, and will be a collaborative effort between FG Optics Inc. and its subsidiary, FG Tiantong. The project is slated for completion within 12 months.

The bulk of the project funds will be channeled into renovation works, the procurement of machinery and equipment, and initial working capital. Once operational, it will embark on the mass production of various precision optical components, including molded lenses, spherical/aspherical lenses, and flat lenses, catering to markets such as consumer electronics, automotive optics, and optical communications.

More strategically significant is the R&D project for high-performance aerospace optical lenses, which will see all 30 million yuan earmarked for R&D expenditures, excluding any fixed asset acquisitions. The breakdown includes 9 million yuan for R&D of drone optoelectronic payloads, 13.5 million yuan for R&D of aerospace optoelectronic payloads, and 7.5 million yuan for R&D of large-aperture high-performance lenses. This project is set to span 24 months.

In fact, FG Optics Inc. has already made significant strides in the realm of payload-grade products. In the first half of 2026, optoelectronic payloads for civilian drones achieved mass shipments, while new optoelectronic payloads for drones and unmanned vehicles have begun small-batch deliveries.

In the aerospace sector, the company's products have found application in the "Shenzhou XXIII" manned spacecraft. The new-generation ground-based telescope, through refined optical design, has achieved a 50% expansion in detectable spectral range and a 20% reduction in weight, meeting world-class standards and enabling mass delivery for tasks including aerospace, deep-space exploration, and space debris observation.

In the automotive sector, multiple automotive LiDAR lenses have passed verification by leading mainstream customers and entered mass production, with 23 new designated projects. HUD lenses have also commenced mass production.

These business advancements suggest that the company's strategic shift towards high-value-added products has started to bear fruit, and the current 30 million yuan R&D investment further solidifies this trajectory.

From a financial standpoint, FG Optics Inc.'s operating performance has yet to exhibit a clear inflection point, with a net loss attributable to shareholders of 12.9533 million yuan and a net loss after excluding non-recurring items of 52.0377 million yuan in the first half of 2026. R&D expenses saw a 10.64% year-on-year increase, with an R&D expense ratio of 14.21%, up 2.97 percentage points from the same period last year. The company was awarded 70 new patents, a 70.73% year-on-year surge, including 19 invention patents. As of now, the company boasts 1,094 authorized patents and software copyrights, including 625 invention patents.

Against the backdrop of an operating performance that has yet to turn positive, the company's decision to allocate the remaining raised funds towards capacity expansion and cutting-edge R&D, rather than bolstering working capital, sends a clear message: management is willing to weather short-term performance pressures in exchange for medium- to long-term technological advantages.

In its action plan for "Improving Quality and Efficiency, and Enhancing Returns," the company has set a target for 2026 to achieve operating revenue of 800 million to 1 billion yuan and net profit of 40 million to 60 million yuan. The two investments totaling 110 million yuan represent a practical pathway towards achieving these goals, leveraging capacity expansion to secure cost advantages amidst growing downstream demand and utilizing R&D projects to unlock incremental opportunities for payload-grade system products.

The 15.78% internal rate of return projected by the company for the precision optical components project and the 24-month technological breakthrough cycle for the aerospace lens R&D project reflect two distinct strategies: medium-term capacity returns and medium- to long-term technological positioning, respectively. The former carries risks associated with capacity ramp-up and order absorption, while the latter hinges on the successful translation of R&D outcomes into replicable payload-grade products and their introduction to customers.

Looking ahead, the crux of FG Optics Inc.'s success in this 110 million yuan investment will hinge on its ability to transform its technological prowess in large-aperture optical systems into replicable competitiveness in payload-grade products.