KOSDAQElectronic Components203450

UNION biometrics

₩2,840 0.00%2026-10-02 close

Market Cap

₩40.1B

Turnover

₩100M

Volume

40,000 shares

Shares out.

14.1M

PER

24.5×

PBR

0.7×

EPS

₩103

Dividend Yield

3.57%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩90 per share · Prices as of the 2026-10-02 close

Report overview

Beyond Biometrics: Expanding Into AI Data Center Security

Union Biometrics is adding AI data center security as a new growth axis on top of its fingerprint and facial recognition access control business, though quarterly earnings volatility remains significant.

1
2025 consolidated revenue was KRW 51.3 billion, down year-on-year, while quarterly results have swung between gains and losses since the third quarter of 2025 amid domestic and overseas business momentum.
2
ODM supply of facial recognition terminals to NEC and SoftBank in Japan, along with cooperation with France's Data One for North American and European AI data center security business, is emerging as a new revenue source.
3
Both the first and second quarters of 2026 posted operating losses, indicating that a profitability recovery is not yet firmly established.
4
Launch of a construction safety platform and application to data center projects in New Jersey and Indiana in the United States are planned for the second half, and whether these translate into results needs to be confirmed.
5
The AI-based pet nose print recognition service was designated as an ICT regulatory sandbox project in August 2025, positioning it as a candidate new business line.

Business structure

Union Biometrics, founded in 2000, is a biometric recognition specialist that develops and sells access control hardware such as fingerprint and facial recognition terminals and fingerprint modules and registration devices, based on its own core fingerprint and facial recognition technologies, while also providing access and attendance management services.

The company changed its name to Union Biometrics in 2025 and operates subsidiaries in Vietnam and the UAE. It holds 208 intellectual property rights and continues new product development with R&D spending equivalent to about 6.6% of revenue.

Domestic customers include financial institutions such as NongHyup Bank, security providers such as SK Shieldus, and government and public institutions, while overseas the company is expanding ODM supply of facial recognition edge terminals to NEC and SoftBank in Japan and participation in AI data center security projects through France's Data One.

It has also signed a memorandum of understanding with Bangladeshi IT company ACOTE Group for joint entry into global security markets.

Its traditional fingerprint access control business has seen demand decline amid a shift toward contactless products since COVID-19, and its fingerprint module business is reportedly struggling to secure new customers because clients bear the cost burden of switching products.

In contrast, the company is broadening its portfolio into higher-value facial recognition solutions, AI data center access management solutions, a construction site safety monitoring platform, and pet nose print recognition.

Suprema, Xperix, and Raonsecure are cited alongside the company as domestic listed peers in the biometric authentication theme.

Earnings trend

Quarterly revenue · Operating profit

₩11.8B-₩300M25Q2₩13.2B₩500M25Q3₩13.4B₩46,872,05925Q4₩11.4B-₩900M26Q1₩13.8B-₩400M26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩46.3B₩1.3B2022₩51.4B₩1.6B2023₩56.7B₩2.8B2024₩51.3B₩1B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩11.8B	-₩300M	−2.7%
2025Q3	₩13.2B	₩500M	3.6%
2025Q4	₩13.4B	₩46,872,059	0.3%
2026Q1	₩11.4B	-₩900M	−7.5%
2026Q2	₩13.8B	-₩400M	−2.6%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩46.3B	₩1.3B	₩2.2B	2.9%	5.8%	52.0%
2023	₩51.4B	₩1.6B	₩3.1B	3.1%	7.7%	51.2%
2024	₩56.7B	₩2.8B	₩4.9B	5.0%	11.8%	68.9%
2025	₩51.3B	₩1B	₩2B	2.0%	4.8%	50.8%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23

Earnings analysis

Annual revenue grew from KRW 46.25 billion in 2022 to KRW 51.38 billion in 2023 and KRW 56.75 billion in 2024, before declining to KRW 51.32 billion in 2025.

Operating profit rose sharply from KRW 1.34 billion in 2022 and KRW 1.57 billion in 2023 to KRW 2.84 billion in 2024, then contracted sharply to KRW 1.02 billion in 2025, while net income attributable to owners fell from KRW 4.95 billion in 2024 to KRW 2.01 billion in 2025.

On a quarterly basis, the second quarter of 2025 posted revenue of KRW 11.83 billion with an operating loss of KRW 0.32 billion and a net loss of KRW 0.20 billion, but the third quarter turned profitable with revenue of KRW 13.21 billion, operating profit of KRW 0.47 billion, and net income of KRW 0.85 billion.

The fourth quarter maintained a profitable trend with revenue of KRW 13.44 billion, operating profit of KRW 0.05 billion, and net income of KRW 0.45 billion.

However, in the first quarter of 2026 revenue fell to KRW 11.41 billion and the operating loss widened to KRW 0.86 billion, while net income remained positive at KRW 0.31 billion, suggesting non-operating factors cushioned the bottom line.

In the second quarter of 2026, revenue rose again to KRW 13.79 billion, but the company swung back to an operating loss of KRW 0.35 billion and a net loss of KRW 0.37 billion.

This pattern of alternating operating profits and losses over the past five quarters shows that revenue recovery and profitability stabilization have not occurred simultaneously.

The company attributed the third-quarter 2025 improvement to increased exports of facial recognition systems to NEC in Japan and the first revenue contribution from its AI data center access management solution.

Industry analysis

The company is classified under the security equipment sub-sector within the KOSDAQ electronics and electrical equipment industry group. Its end markets combine domestic and overseas physical security demand with an emerging convergence of information security demand tied to recent personal data breach incidents.

In Korea, large-scale customer data breaches have spurred discussion of integrated physical and information security systems, which the company views as an opportunity.

Globally, expanding AI data center investment by major technology companies is generating derivative demand for biometric access control and user authentication at data centers.

However, larger competitors such as Suprema also participate in this market, and the company, as a relatively smaller player, is pursuing a strategy of building references through partnerships with specific players such as NEC and Data One.

The domestic fingerprint access control market has seen growth stagnate in legacy product lines as demand shifted toward contactless products after COVID-19, a structural change that appears common across multiple players in the sector.

Outlook

When announcing first-quarter 2026 results, the company said it conducted preemptive marketing investments including participation in the Intersec Dubai exhibition and the domestic SECON 2026 security expo, along with hosting the 'UGC 2026' global partner conference, and stated it expects these investments to translate into second-half revenue growth.

The company is preparing a next-generation construction safety platform, a real-time on-site monitoring and disaster prevention solution targeted for launch in the second half, while its facial recognition-based health monitoring solution 'HealthID' has been expanding application sites since its introduction at an LH public housing construction site built by Hansin Engineering & Construction.

Development of the next-generation integrated security platform 'AlphaX' and an ICT regulatory sandbox project addressing forthcoming legislation on pet nose print registration are also underway in parallel.

Overseas, the company is expanding its reference base through follow-on projects with France's Data One, and it stated that biometric solutions are scheduled to be applied to new data center construction projects in New Jersey and Indiana in the United States in the second half of 2026.

In early September 2026, an additional case was disclosed of the company supplying facial recognition edge terminals via ODM for an NEC and SoftBank project in Japan, aimed at strengthening its ODM competitiveness in the Japanese market.

However, when and to what extent these new business lines and overseas projects will translate into actual revenue and profit remains a matter to be confirmed through future quarterly results.

Valuation

PER

24.5×

PBR

0.7×

ROE

3.0%

EPS

₩103

BPS

₩3,383

Dividend per share

₩90

Net income summed over the most recent four quarters (third quarter of 2025 through second quarter of 2026) has contracted significantly versus full-year 2024 net income, so the price-to-earnings ratio calculated on this reduced earnings base sits in a relatively elevated range.

By contrast, the share price trades below the company's accumulated net asset value, reflecting a discount relative to book value.

The company has a track record of paying cash dividends, but given the recent quarterly pattern of alternating operating profits and losses, the sustainability and size of future dividends may depend on the pace of earnings recovery.

As a small-cap stock with a limited market capitalization, price volatility tied to trading volume and supply-demand shifts is also a factor to consider.

Ultimately, how the valuation level should be assessed depends heavily on whether future quarterly results stabilize into a profitable trend and whether AI data center and overseas new business lines translate into revenue.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-23

Bull factors

Expansion into AI data center security

The company is supplying biometric security solutions to AI data centers in Europe through cooperation with France's Data One, and application to data center projects in New Jersey and Indiana in the United States is scheduled for the second half of 2026.

The third quarter of 2025 marked the first-ever revenue contribution from its AI data center access management solution. As long as major technology companies continue expanding AI infrastructure investment, the underlying demand base for related solutions could broaden.

Growing ODM exports to Japan

The company continues to supply facial recognition edge terminals via ODM for projects related to NEC and SoftBank in Japan, and it has stated that exports to NEC, which began in November 2025, have continued to increase.

Growing overseas revenue mix, combined with a rising share of higher-value products, contributed to profitability improvement as confirmed in third-quarter 2025 results. Confirmed practical benefits such as in attendance management could lead to follow-on orders.

Diversifying the business portfolio

The company is simultaneously preparing new business areas including a construction site safety monitoring platform, the integrated security platform 'AlphaX,' and pet nose print recognition.

The pet nose print recognition service was designated as a government ICT regulatory sandbox project in August 2025, laying institutional groundwork.

Government and public-sector R&D projects, such as an integrated smart building security platform, are also validating its technology and supporting the diversification strategy.

Bear factors

Persistent quarterly earnings volatility

Operating profit, which turned positive in the third and fourth quarters of 2025, reverted to losses in both the first and second quarters of 2026.

Revenue rose to KRW 13.79 billion in the second quarter of 2026, yet the company posted an operating loss of KRW 0.35 billion and a net loss of KRW 0.37 billion, showing that revenue growth and profitability improvement have not moved together.

A mismatch between periods of expanding new business investment costs and the timing of revenue recognition could widen quarter-to-quarter variance.

Weakening demand for core product lines

Fingerprint access control products have reportedly seen declining sales as demand shifted toward contactless products after COVID-19. The fingerprint module business is also confirmed to be struggling to secure new customers due to clients' burden of product replacement costs. This suggests the existing core revenue base could continue to shrink even as new businesses grow.

Small revenue and earnings base as a small-cap

With annual revenue in the low tens of billions of won and annual operating profit ranging from roughly KRW 1 billion to KRW 3 billion, the company's absolute scale is small enough that a single large contract, exchange rate swing, or one-off cost can meaningfully move results.

As seen in the first quarter of 2026, net income can remain positive even as the operating loss widens, meaning the contribution of non-operating items needs to be examined separately each quarter. This structure heightens uncertainty in forecasting results.

Risk factors

Earnings volatility

Operating profit has alternated between profit and loss over the past five quarters, and revenue itself has fluctuated between roughly KRW 11.4 billion and KRW 13.8 billion per quarter.

Quarterly results can be significantly affected by the timing of specific customer orders or the execution timing of new business investment costs.

Overseas expansion risk

Overseas businesses such as U.S. and European data center projects and the Bangladesh memorandum of understanding are still at an early stage, with dependence on local partners such as Data One and ACOTE Group, alongside exposure to exchange rate movements and local regulatory compliance burdens. If planned projects are delayed or scaled back, expected revenue contributions could be pushed further out.

Intensifying competition and new product development cost burden

Larger competitors such as Suprema participate in the same biometric and security markets, raising the risk of simultaneous price and technology competition.

Given the business's need to continuously invest research and development spending equivalent to about 6.6% of revenue, fixed-cost burdens could weigh on profitability if revenue growth stalls.

What to watch next

Around November 2026 (expected third-quarter earnings release)
Check whether operating profit turns positive again in the third quarter of 2026 and how revenue and profitability trends continue from the second quarter.
During the second half of 2026
Monitor whether the New Jersey and Indiana data center projects in the United States are implemented and reflected in revenue, and track progress on follow-on projects with France's Data One.
During the second half of 2026 (targeted launch of the construction safety platform)
Confirm the actual launch and commercialization progress of the next-generation construction safety platform and whether adoption by construction companies expands through use of industrial safety and health management cost budgets.
From the fourth quarter of 2026 onward
Track legislative discussions on pet nose print registration and the follow-up progress of the ICT regulatory sandbox project to assess whether an institutional foundation for this new business is being established.

Overall view

Union Biometrics is broadening its scope from a traditional fingerprint and facial recognition access control business into new areas such as AI data center security, a construction safety platform, and pet nose print recognition.

The company returned to profit in the third and fourth quarters of 2025, helped by expanded exports to NEC in Japan and the first revenue contribution from its AI data center solution, but it swung back to operating losses in both the first and second quarters of 2026, meaning profitability recovery has not yet become consistent.

On an annual basis, 2025 revenue, operating profit, and net income all declined from 2024, and demand weakness in the core fingerprint access control and module businesses remains a structural burden.

On the other hand, reference-building through overseas partnerships with Data One, NEC, and ACOTE Group, along with participation in government R&D projects, provides a basis for future diversification.

Ultimately, how this company should be assessed depends on when and how much new businesses actually contribute to revenue and whether quarterly operating results settle into a stable profitable trend, matters that will need to be confirmed through the coming quarters of results.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.