KOSDAQIT & Software331380

Focus Ai

₩2,130▲ 2.90%2026-10-02 close

Market Cap

₩78.7B

Turnover

₩200M

Volume

110,000 shares

Shares out.

37M

PER

—

PBR

1.4×

EPS

-₩451

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Core Losses Persist as Firm Bets on Digital Assets

As revenue and profitability in the core AI physical security business continue to decline, the acquisition of Busan Digital Asset Exchange is being positioned as a new growth pillar centered on RWA tokenization and payments.

1
2025 revenue fell 22.1% year-on-year to KRW 45.3 billion, with the operating loss widening to KRW 10.2 billion.
2
The Q2 2026 operating loss narrowed versus the prior quarter, showing some signs of improvement.
3
The company pursued the acquisition of Busan Digital Asset Exchange (Bdan) starting last December and became its largest shareholder with a 40.61% stake in February 2026.
4
JM Coffee Group Chairman Yang Jae-seok raised his stake to over 20% by participating in an KRW 8 billion capital increase through Jplanning.
5
The company has stated that the digital asset segment's contribution to total revenue remains limited, at 5% or below.

Business structure

Focus AI is a physical security solutions company that provides AI cameras and video storage devices (DVR/NVR) alongside mobility and smart-factory safety monitoring, smart parking control, and access control platforms.

More recently the company has extended its AI video technology into special vehicles, drones, and robotics, and has introduced services combining payment business with payment security solutions.

At its March 2025 annual shareholders' meeting the company changed its name from Focus HNS to Focus AI as part of a push to strengthen its AI capabilities.

In response to rising demand for safety management solutions following enforcement of the Serious Accidents Punishment Act, the company completed AI solution testing with Samsung Heavy Industries and has been supplying AI-based forklift safety solutions to large industrial sites to build references.

Overseas, it has pursued market diversification by participating in the SECON security expo, the U.S. logistics trade show ProMat, and Intersec Dubai in the UAE, while strengthening cooperation with Toa Corporation in Japan.

The most significant structural shift has been the acquisition of Busan Digital Asset Exchange (Bdan), pursued since last December and finalized in February 2026, giving the company a 40.61% stake and largest-shareholder status.

Bdan is Korea's first digital real-asset exchange, tokenizing physical assets such as gold, silver, and platinum on a blockchain for round-the-clock trading, and the company is pursuing a strategy that combines its AI security technology with Bdan's digital asset trading infrastructure centered on its mobile payment app PayPlug.

However, the company has stated that the digital asset segment's contribution to total revenue remains limited, at 5% or below, for now.

On the governance side, after WeHub became the largest shareholder in 2024, Compose Coffee founder and JM Coffee Group Chairman Yang Jae-seok expanded his influence in 2026 by raising his combined direct and indirect stake to over 20% through a capital increase via Jplanning.

Earnings trend

Quarterly revenue · Operating profit

₩11.3B-₩3.7B25Q2₩13.5B-₩1.3B25Q3₩10.8B-₩2.8B25Q4₩7.8B-₩2.5B26Q1₩10.6B-₩1.2B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩61.6B₩2.7B2022₩59.5B₩2.6B2023₩58.2B-₩5.1B2024₩45.3B-₩10.2B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩11.3B	-₩3.7B	−32.7%
2025Q3	₩13.5B	-₩1.3B	−9.9%
2025Q4	₩10.8B	-₩2.8B	−25.8%
2026Q1	₩7.8B	-₩2.5B	−31.9%
2026Q2	₩10.6B	-₩1.2B	−11.0%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩61.6B	₩2.7B	₩2.7B	4.3%	12.9%	80.0%
2023	₩59.5B	₩2.6B	₩2.5B	4.5%	10.8%	60.1%
2024	₩58.2B	-₩5.1B	-₩11B	−8.7%	−66.8%	195.0%
2025	₩45.3B	-₩10.2B	-₩10.3B	−22.5%	−48.5%	120.7%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

Focus AI's annual results show a clear inflection point. In 2022 and 2023 the company posted revenue of KRW 61.6 billion and KRW 59.5 billion respectively, along with operating profit around KRW 2.6 billion and net profit of KRW 2.4-2.7 billion, maintaining an operating margin near 4%.

However, in 2024 revenue slipped slightly to KRW 58.2 billion while performance deteriorated sharply, with an operating loss of KRW 5.1 billion and a net loss of KRW 11.0 billion, and in 2025 revenue fell further to KRW 45.3 billion (down 22.1% year-on-year) as the operating loss widened to KRW 10.2 billion and the operating margin dropped to -22.5%.

Net losses remained around KRW 10.3 billion over the same period, marking two consecutive years of double-digit-billion-won losses. On the balance sheet, the debt ratio surged from 60.1% in 2023 to 195.0% in 2024 before easing to 120.7% in 2025, reflecting capital raised through multiple third-party share issuances.

Operating cash flow swung from an inflow of KRW 6.0 billion in 2023 to outflows of KRW 3.4 billion in 2024 and KRW 7.8 billion in 2025, indicating growing reliance on external financing.

Looking at recent quarters, revenue peaked at KRW 13.5 billion in Q3 2025 before falling to KRW 10.8 billion in Q4 and KRW 7.8 billion in Q1 2026, then recovering to KRW 10.6 billion in Q2 2026.

The operating loss narrowed from KRW 3.7 billion in Q2 2025 to KRW 1.3 billion in Q3, then widened again to KRW 2.8 billion in Q4 and KRW 2.5 billion in Q1 2026, before narrowing once more to KRW 1.2 billion in Q2 2026.

Over the most recent four quarters (Q3 2025 through Q2 2026), the cumulative net loss attributable to shareholders reached approximately KRW 12.0 billion, showing that despite quarter-to-quarter fluctuations, the underlying loss trend has continued.

Industry analysis

Focus AI belongs to the security equipment sub-sector (per FICS classification) within KOSDAQ's electrical/electronics industry, where the physical security hardware market for CCTV, DVR, and NVR products features competition among numerous small and mid-cap KOSDAQ companies.

The 2024 expansion of the Serious Accidents Punishment Act, which increased demand for workplace safety management solutions, provides a positive backdrop for the company's industrial safety AI business.

In contrast, revenue from the core hardware distribution business has shown a structural decline, prompting the company to pursue a shift toward an AI solution-based system integration (SI) model.

The newly acquired real-world asset (RWA) tokenization market is a fast-growing emerging area; a consortium that includes Bdan, led by the Korea Exchange and joined by roughly 40 financial institutions including BNK Financial Group, obtained preliminary approval to operate Korea's first over-the-counter securities trading intermediary for security token offerings.

Trading volume for one of Bdan's real-asset products, 'e-Silver,' reportedly reached about KRW 148.9 billion in a single month this January, more than a hundredfold increase from the same month a year earlier, indicating rapidly rising demand for investment in physical assets such as gold and silver.

However, venture capital industry participants have flagged significant regulatory uncertainty for companies involved in virtual and digital assets, and government-backed fund-of-funds programs are reportedly not encouraging investment in this area.

Overall, the company finds itself in a dual position: restructuring within a shrinking traditional physical security market while simultaneously expanding into the early-stage, high-growth RWA and digital asset market.

Outlook

The company has stated its policy of accelerating the shift from a hardware-distribution-centered structure to an AI solution-based system integration (SI) model.

To support this, it sold land in Daegu that had been acquired in 2024 for an AI R&D center, recovering the full KRW 2.7 billion investment, with plans to redirect the proceeds toward upgrading AI physical security technology and expanding its customer base.

Proceeds from the KRW 8 billion capital increase to Jplanning, completed in early June, are earmarked for operating funds and for strengthening the company's capacity to respond to new business and contracts, which the company has described as a measure to reinforce financial stability.

Separately, the company has indicated that an additional KRW 3 billion third-party share issuance, whose schedule has been adjusted multiple times, could bring in further funding in stages if it proceeds as planned.

CEO Koo Hyung-mo has stated that structural improvements pursued since the new management team took over—including SI business restructuring, expansion of industrial safety solution supply, and diversification of the customer base—are gradually producing results.

Following the Bdan acquisition, the company has outlined plans to progressively upgrade digital-asset-based payment and settlement infrastructure, aiming to build a Korean-style Web3 payment platform that combines AI, payments, stablecoins, and digital wallets.

However, the company itself has acknowledged the possibility of goodwill impairment, leaving asset quality management related to the Bdan acquisition as a variable that could affect future financial statements.

Valuation

PER

—

PBR

1.4×

ROE

-56.8%

EPS

-₩451

BPS

₩1,331

Dividend per share

₩0

Because the company has posted net losses in two of the past three fiscal years, a conventional price-to-earnings ratio cannot be meaningfully calculated.

At the same time, the shares tend to trade at a premium to book value per share, though it is worth noting that for a small-cap company with a relatively modest equity base, such price-to-book multiples can move significantly.

No dividends have been paid recently, so dividend-related metrics are not established, which is typical for a company not currently generating profit.

Unlike 2022-2023, when the company was profitable, performance turned to losses from 2024 onward and a recovery to profitability has not yet been confirmed, so any valuation assessment should be considered alongside recent quarterly earnings trends and the changing revenue contribution from new businesses such as digital assets and payments.

The frequent third-party share issuances used to raise capital are a factor that can affect per-share metrics by increasing the share count.

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 2026-09-04

Bull factors

New Growth Pillars Through Business Diversification

Through the acquisition of Busan Digital Asset Exchange, the company has entered the RWA tokenization market, and a related consortium obtained Korea's first preliminary approval for an OTC security token trading intermediary.

Trading volume for Bdan's real-asset product e-Silver reportedly grew more than a hundredfold year-on-year this January, indicating steep growth. The company is also pursuing a strategy combining its PayPlug payment platform with AI security technology, broadening its business portfolio.

Direct Capital Injection by the Controlling Shareholder

Controlling shareholder Yang Jae-seok directly participated in an KRW 8 billion capital increase through Jplanning, a company he wholly owns, signaling a commitment to responsible management. As a result of this issuance, his combined direct and indirect stake rose above 20%. The proceeds are earmarked for operating funds and R&D to strengthen the competitiveness of the core business.

Securing Large-Scale References in Industrial Safety Solutions

In response to rising demand following enforcement of the Serious Accidents Punishment Act, the company completed AI safety solution testing with Samsung Heavy Industries and has been building references by supplying AI-based forklift safety solutions to large industrial sites.

It has also pursued overseas market development by participating in exhibitions such as SECON, ProMat, and Intersec Dubai. The narrowing of the Q2 2026 operating loss versus the prior quarter can also be interpreted as a result of cost efficiency efforts.

Bear factors

Structural Decline in Core Business Revenue

Revenue has declined for four consecutive years, from KRW 61.6 billion in 2022 to KRW 45.3 billion in 2025, with a particularly sharp 22.1% year-on-year drop in 2025. The operating margin also deteriorated sharply, from 4.5% in 2023 to -22.5% in 2025.

The cumulative net loss attributable to shareholders over the most recent four quarters reached about KRW 12.0 billion, showing the loss trend has persisted.

Financial Strain and Reliance on External Funding

The debt ratio surged to 195.0% in 2024 and remained elevated at 120.7% in 2025. Operating cash flow registered net outflows in both 2024 and 2025, with the outflow scale widening.

To cover this, the company has repeatedly turned to third-party share issuances, some of which experienced changes in the allottee and delays to the payment schedule.

Execution Risk in Early-Stage New Businesses

The company itself has stated that the digital asset segment's contribution to overall revenue remains limited at 5% or below, and it has acknowledged the possibility of goodwill impairment related to the Bdan acquisition.

During the acquisition process, the allottee and method (from in-kind contribution to cash) of related capital increases were changed, and the final payment schedule was postponed multiple times.

Industry observers have also noted limited inflows of policy funds and venture capital into virtual-asset-related businesses, suggesting the funding environment for the new business may not be favorable.

Risk factors

Financial and Liquidity Risk

The elevated debt ratio and successive net outflows in operating cash flow point to growing reliance on external financing. Multiple third-party share issuances have previously seen changes to the allottee and delays to the schedule, making future fundraising less predictable.

The company itself has acknowledged the possibility of impairment on goodwill recognized in connection with the Bdan acquisition, so further loss recognition cannot be ruled out.

Business Model Transition Risk

As the traditional physical security hardware distribution business contracts, the simultaneous transition toward an AI SI model and new digital asset and payment businesses could complicate resource allocation priorities.

Because the digital asset segment's revenue contribution remains low, further confirmation is needed on whether the new business has grown enough to offset weakness in the core business.

There is also a possibility of temporary inefficiencies arising from personnel and organizational changes during the business restructuring process.

Ownership Structure and Governance Risk

Governance changes have recurred, with effective control shifting from WeHub in 2024 toward Chairman Yang Jae-seok's Jplanning in 2026. Frequent capital increases and share transactions involving related parties warrant continued monitoring of alignment with minority shareholder interests.

The possibility that management strategy consistency could be affected by further ownership changes cannot be ruled out.

What to watch next

Around mid-November 2026
This is the expected timing for the Q3 2026 earnings disclosure, and it will be important to check whether the narrowing operating loss trend seen in Q2 continues.
Upon future disclosure (timing unconfirmed)
Investors should verify whether the previously delayed KRW 3 billion third-party share issuance is actually completed and whether the allottee changes again.
In upcoming quarterly disclosures
It is worth monitoring segment revenue disclosures to see whether the digital asset (Bdan) segment's contribution expands beyond the current sub-5% level.
Second half of 2027 (monitoring needed ahead of maturity)
It is worth checking in advance the repayment or refinancing plans for approximately KRW 15 billion of convertible bonds maturing in August and September.
Upon future contract or disclosure announcements
Follow-up disclosures should be checked to see whether industrial safety AI solution tests with large corporations such as Samsung Heavy Industries convert into actual supply contracts.

Overall view

Focus AI has experienced clear deterioration in its core AI physical security business, with four consecutive years of revenue decline and two consecutive years of operating losses, and is pursuing expansion into RWA tokenization and payment businesses through the acquisition of Busan Digital Asset Exchange to offset this weakness.

Recent quarterly results showed a narrowing operating loss, but the underlying loss trend has continued, so a confirmed recovery has not yet been established.

On the financial structure side, the debt ratio remains elevated and operating cash flow has continued to post net outflows, making the company's reliance on external funding through frequent third-party share issuances clearly visible.

Alongside a governance shift in which control moved from WeHub toward Chairman Yang Jae-seok's group, the controlling shareholder's direct participation in capital increases can be read as a signal of committed management, while also leaving the task of managing ownership volatility.

The new digital asset business operates in a market with confirmed growth potential, but its contribution to company revenue remains minimal for now, and financial uncertainties such as potential goodwill impairment related to the acquisition also persist.

Investors should track whether the core business's profit and loss improve in coming quarters, how quickly the new business's revenue contribution expands, and whether the scheduled fundraising is actually completed.

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.