Gapwaves AB (publ)

Welcome to RedEye and this live queue where we have Gapwaves presenting today. We will have both CEO Jonas Ehinge and CFO Nils Mösku presenting the quarter followed by a Q&A session. Before I hand over to them, if you have any questions, please fill out the question formular on the website so we can deal with those and get answers to those after the presentation. But without further to do, I hand it over to you, Jonas.

Thank you, Rasmus. Good to be back here and I'm happy to join Red Eye for today's presentation of the second quarter report that was published earlier today. So like Rasmus said, we'll go through a summary and make sure that we have enough time to discuss your questions and also I'm sure Rasmus has some questions related to the second quarter report. So first for those of you that are new to Gapwaves, we're a tech company located in Gothenburg, founded in 2011. And our main application area right now is for radar antennas, especially within automotive. But we're really a waveguide technology company, and this technology can be used in various other areas, primarily wireless solutions in higher frequencies, such as in automotive radars that are utilizing higher frequencies to get better performance also. And within automotive, we're considered a tier two supplier. So we develop design production and set up production and deliver antennas for our customers that are tier one suppliers. Some of the names of such companies are surely familiar to you. And our customers supply their customers to car manufacturers. They are called normally in this industry OEMs. and they supply these solutions to several OEMs. We're listed on NASDAQ since 2016. And I'll discuss some of the other applications later in this presentation. So fundamentally, for GethWaves, we're active in a growing market with strong market potential. Requirements on active safety features in cars are increasing. and there are legal requirements and also regulatory requirements for how these sensors are going to work and how these functions of the cars need to perform in various conditions, driving the need for radar sensors, which we see clearly in our increased production volumes. Our technology is unique worldwide. It's well protected in patents over 45 patent families as of now. This is far more mature now than just a lab product or a lab technology. We have to date produced more than 2 million antennas with Gapwaves technology. It's right now under licensed production, but it's still our design, our production processes, our design production capacity, together with a customer, Hella, and a contract manufacturer, Fränken, in China. Our business model is asset light since we don't build and maintain our own factories. We contract with select partners that we pre-qualify for this type of production and scale up. So turning to Q2 and the report that was published earlier today, the main thing in that report, and we're very happy to report that, it's a fundamental, very fundamental milestone for gapwaves development going forward. It's the completion of the high-volume start-up production in China for Valeo. Most of you probably know that we started production for Valeo already last year in Gothenburg, but this is the high-volume line that will scale up significantly over the coming years. As I mentioned, more than 2 million antennas have been produced by the end of the quarter with GetWaves technology. That's a solid proof of how well this technology and our products can be industrialized and scaled up. We've also added and strengthened our supplier base through the partnership with AT&S from Austria providing layers for our MLW antennas. And during the quarter, we're also entering into new application segments or market segments beyond automotive radar. So coming back to this big milestone and achievement, during the second quarter where we transition from pilot production in Gothenburg running at well over full capacity for the last 9 to 12 months and now we're ramping up in the next step and the next phase with high volume production in Shuzhou in China together with Franken at their facility there. This volume ramp up that now takes that now starts will accelerate heavily going forward and that will take time to get into several millions of millions of units per year we estimate that this process will take around two years with successively increasing volumes month by month and quarter by quarter And it's not only an important milestone now, it's also an important statement to other customers and validating gapwaves in terms of its technology, but also the production processes and our ability to set up and manage and scale up this production for our customers, especially in automotive. Looking at the numbers in the second quarter, I'd like to invite Nils to discuss this and also summarize the numbers from the Q2 report.

Thank you, Jonas. And as you have seen, revenue came in at that 13.1 million. That's 11 million lower than last year. In general, that reflects the lower project revenues and the fact that the product sales does not yet offset those lower project revenues. Also good to keep in mind that last year's figures were affected by production equipment sales of around 7.7 million SEK and the booking for a council project, which was booked in Q2. On EBITDA, there's a couple of reasons for the lower EBITDA. Firstly, there's a higher startup cost for the launch, for example, travel to China, et cetera, freight cost, et cetera. Secondly, we are in a launch phase. So as we increase volumes, the per unit cost will decrease. And thirdly, it's a mixed effect on the revenue side. Project sales are profitable and, of course, more profitable than high volume product sales. But of course, they are also a bit more volatile in their nature. Total cash flow came in at minus 22.6 million. That includes a partial repayment of our loans, our trade finance loans of 10.8 million. If we go to the next page, there's a breakdown on the revenue mix. And as you can see, the yellow part on that slide shows the revenue from last year from production equipment sales of 7.7 million. Stripped out for that, the year-on-year comparison looks a bit more fair. What it also shows is that we are transiting from the revenue mix, from project revenues to product revenues. And this will continue over the next quarters as production will ramp up. And in the end, or in a couple of quarters, product revenues, product sales revenues will dominate and be the most important revenue source for us. Yes, Jonas.

Thank you, Nils. And turning over to some other news in the report, we were very happy to now finally be able to announce that one of the customers for Valeo since 2025, actually, is Geely and Geely Group. So Valeo has been supplying its radar sensor to Valeo since last year. Geely is already the second largest automotive group in China and it's also growing rapidly in the global market. I think it's making the top 10 globally already in terms of volume and revenue. And that Geely is a customer for these radar sensors with our antennas is an important statement to the value that Getwaves products are providing to Valeo and to Valeo's customers. in this solution being competitively strong, also in the volume segment, not just in the high-end or premium car segment. And we have expectations to see these volumes to Geely and within the Geely Group to grow in the coming periods. Looking beyond automotive, we partnered up in a joint development contract with Gottmik for a new application area called packaging where our waveguide technology is used not specifically for antennas but to provide wireless or low loss solutions when it comes to power amplifiers specifically used for communication solutions and this is like prior in the system before satellite dishes etc. This is a growth area and we see a lot of potential in this going forward. The first customer of Gotmic is an American defense group. We've not been able to disclose the name of that group. So we see quite a bit of potential going forward here with Gottmik, but also with other customers in these segments going forward. Another growth segment is in-cabin radar and with coming legal requirements and and regulations for in-cabin sensors to detect presence of animals or passengers or children in the car and obviously cameras have been used for this but also have some drawbacks in terms of integrity but also not being able to see through blankets and material and we're very happy to be able to partner with Acunair and Vinnova to do some initial research exploring this market and the application of gapwaves high performance antennas in this segment. Also important in the report is the status of SENSRAD with Unfortunately, we've seen some headwind for Sandstrad in the quarter, specifically with weaker development in sales due to delayed orders, and also not being able to add new customers to the existing customer base. And we've also seen a changing market segment or market condition. with new players entering into the field during the second quarter. And of course, Sensrad and its board are taking measures to adapt its business and focus its business accordingly to the market situation. And at Gapwaves, we follow our investment, of course, through regular assessments. And for the second quarter, this resulted in in an impairment adjustment. Nils, do you want to add anything on that specific part?

I think you covered it all. The impairment has been done on the equity part of the holding and

Good. Looking forward, so Gapwaves outlook, it's really important to distinguish the quarter from the longer term outlook. And nothing has changed in the market outlook for Gapwaves. Our volumes are growing. We have very solid customers that are now scaling up together with us. Like Nils mentioned, we're going through a revenue transition. going from more research-focused development type of revenue dominating in the revenue mix to product sales that will become the larger and dominant and importantly more stable type of revenue going forward. In terms of production, the ramp-up will continue. So we expect, it's not a surprise to anyone at this point, that both Valeo and Hella production will continue to scale up. And we're, of course, continuing with our supply chain development, looking at other regions than China-based high-volume production also. New growth drivers that we want to highlight is, of course, the drive towards autonomous vehicles, Level 4 or robot taxis, but also AUTOMATED FREIGHT VEHICLES. THERE'S QUITE A BIT OF MOMENTUM IN THOSE SEGMENTS RIGHT NOW AND THE GROWTH SEGMENTS THAT I HIGHLIGHTED EARLIER IN THE PRESENTATION WITHIN DEFENSE PACKAGING BUT ALSO IN CABIN RADAR. SO NEAR TERM OUR MAIN PRIORITIES ARE OF COURSE TO CONTINUE THIS RAMP UP AND SCALE UP IN VOLUMES WHERE WE WILL SEE SIGNIFICANT INCREASES IN VOLUME significant increases in revenue from production and product sales. The business development is very important for us in establishing gapwaves in new segments. And of course, we're continuing expanding within automotive. We have a number of well-progressed customer discussions that have been ongoing for quite some time. In spite of the general market pressure, especially in automotive. These dialogues have progressed, although slower than we had hoped, but they're still there and we're making progress and we're getting into a good position with those to add to gapwaves going forward. And as an indication, I normally show this also, but look at the volume increases that we have seen, and this will continue also. In 2025, we were already at just over 800,000 antennas, This year, we expect to be above 4.5 million antennas produced. And for next year, we expect that number to be accumulated over 10 million antennas. So it's quite a massive ramp up and scale up that we're going through. And we will see the results in the coming years. I think that's the short summary of the report. I hope you had time to read it, but now we're open for questions and hand over to you again, Rasmus.

All right, thank you very much for that presentation. And as a reminder for the viewers out there, if you have any questions, please fill out the form and we'll try to get them answered here. I'm going to start off with, I think there's some confusion with how the ramp up of your customers are going and how much of the revenue is product related versus project or production equipment related essentially. So can you just try to give an illustrative example of how we should expect the progression of volumes to develop over a life cycle essentially?

Over a life cycle with an automotive customer, typically initially there is development revenue. And it could take up to a year to get to a point where tier one decides to freeze the design and push the start button for making it into a product. And that's the start of an industrialization phase. Typically, 1.5 years, maybe two, depends on the tier one and for which market and type of antenna, of course. After the industrialization phase, then you go into production phase and you start going through start of production and then you ramp up. If we're talking about the high volume type of antenna and radar sensor, like a corner radar, those volumes will be massive. So that ramp up phase is around two years, like we indicated in the presentation.

Alright, and if we just spend a little bit more time on the ramp-up phase, if we look at let's say peak volumes, how much as a percent of peak volumes do you see in this initial ramp-up phase? Is it quite a steep curve or is it more gradual over these two years essentially?

Yeah, it's quite a steep curve. I mean, we're talking about massive numbers here, Rasmus. I already indicated in previous communication that the high volume line set up for Valeo has a maximum capacity of around 10 million units per year. And we're starting at essentially zero, you know, at start of production and then ramping up. And what we're looking at is a time window of around two years. And of course the capacity of the line is designed according to the capacity or volume needs of Valeo. Although I'm prohibited to give exact numbers and exact months or quarters for specific volumes for Valeo for obvious reasons.

All right. And you have had this major development of moving the production away from your pilot line into the high volume manufacturing in China. As this progression is happening, you were running the pilot line well above capacity. And so now that you are transitioning, are you winding down the pilot line and ramping up the high volume production? So how should we think about the net volumes essentially?

The net volumes will increase. The high volume line and production taking place in China is so much bigger in absolute numbers than what the pilot line in Gothenburg can produce. It's two entirely different concepts. The Gothenburg line is a pilot line designed to be very flexible for various types of antennas in sizes and complexity. whereas the lines in China are dedicated for high volume. So in terms of absolute numbers, you will not see any impact of us reducing the production and going back to prototype and small volume production in Gothenburg.

All right, so we should not expect an air gap essentially as this transition is happening. If we stick on this topic a little bit more, if you just think about the pilot line was obviously also in a little bit of a ramp up phase, we can say. If you just compare the ramp up in the pilot line to what you see now in the high volume production, like if you go month by month, are we talking about like a 10x higher volume or like a 5x? at the same stage of the process, essentially?

The pilot line was running well above its intended capacity for the last two quarters. And the outer line is starting from zero in the quarter, of course. But very quickly, very soon, the volumes in the high-volume line in China will overtake well the the pilot line volumes. So we're looking at at least 10x going forward, but over that time period, that ramp up time period. And again, you know, we're prohibited to go into specifics per quarter or month in terms of volume supply to specific customers.

All right. I was just trying to get the sense of at the same stage of the process, how much bigger are we talking, but maybe you don't much bigger, much bigger. All right. All right. Um, So you confirmed that Geely is a customer now with, I assume that is within the Valeo customer or tier one, and they have been on the road since 2025. Can you go into which brands or what car models that this relates to?

We can. We don't really have that visibility because platforms within Gigli are being shared between different brands. But as we understand it, these cars that Valeo have been supplying the radar sensor to since last year are not available yet in Europe or in Sweden. We think it's Geely-branded cars, but as soon as we have more detailed information and get approval to communicate this, we will, of course, share that information. But I think the important message here is that it is Geely, and we know Geely owns quite a few brands, including Volvo, Polestar, Seeker, Lincoln Co. and others, so obviously that is a pretty positive you know, indication on future growth opportunities with Valeo and for Valeo with GE.

All right. And given this platform that you're on, do you have a visibility on the term, the volume potential essentially within the specific?

No, I've been We've been trying to look into that. I think both Valeo and ourselves have limited visibility on the volumes of the platforms and what components they share between the different variants of the platform. We know that this is a platform which has some different variants within the Geely group. Right now, it's too early to say.

Alright. Valeo recently also made an order that signal that demand is being pulled forward. Can you go in a bit deeper into what that implies for you and the ramp up curve essentially?

Essentially it's to allow us to accelerate volumes this year far beyond what was planned and contracted. So that PO concerns additional volumes this year for the second part, the second half of this year. And obviously Valeo has this demand from its customers. We think there will be other OEMs supplied during the fall. So we will try to communicate that as we get clarification and approval.

Alright and you gave some guidance here on 2027 volumes that they would reach or you estimate more than 10 million units. Could you give any details if that is primarily HeLa driven or Valeo driven considering they are in a ramp up phase and how we should think about that essentially?

The majority, as we have communicated every time we provide these numbers, is still with Hella, because the Hella production started in Q1 2024, so they're way ahead in their ramp-up. But in the coming years, the volume majority will be overtaken by the Valeo volumes.

Alright. Cash flow in the quarter was about negative, free cash flow in the quarter was about negative 11.5 million. Now that you have made investments into the flex line and so on in Q1 I believe if I'm not mistaken, what do you expect, how do you expect the cash flows to develop in the second half of the year?

I think, Niels, yeah.

Yeah, I'll take it. I mean, you're correct. We had the flex line investment in Q1. Those investments are done. We don't foresee any capex there for the flex line. We are still in the ramp-up phase, so I think it's fair to say that trade working capital will be building up with fluctuations from quarter to quarter, of course. You can never time the invoices directly for a quarter, but trade working capital will be built up as we grow volumes, of course. In general, I think the CapEx Lite model is important to have in mind when modeling our cash flows. It's always a commercial discussion whether we take the capex or not, but we get paid one way or the other. And the big capex comes or capex investments come when you set up a new production line. So I would say trade working capital increases as volume grows, capex I would assume to be relatively low in H2.

All right, perfect. We have received quite a few questions about your capitalization. You have about 50 million crowns as cash. I also believe you have a few loan facilities outstanding. Could you maybe provide what is the total liquidity that you have available and how comfortable are you with the liquidity situation here?

So we have, you're right, we have a trade working capital facility with a bank in Sweden, which will help us through the ramp up of production and volumes. And then we also signed in conjunction with the capital raise last year, we signed a loan agreement that is around 15 million SEK. and we have 50 million cash at bank as of end of Q2.

Alright, so it sounds like you are fairly well capitalized, essentially. If we move on to Zenzrad, I think it came a bit of a shock to many people, the development we have seen there. And first of all, I'm a bit curious, what has happened within Zenzrad from one quarter to another? It seems to be quite a rapid development here, so to say.

Yes, like I said in the presentation, we've seen during the quarter, second quarter, a lack of sales, essentially delayed orders from customers and not being able to bring in new customers to compensate. And also there's been changing market conditions, not only in terms of delays, but also I'm sure everyone has seen that Arbe is now entering the market and of course Arbe and Sensrad are discussing how to coordinate this in the best way. So there's been a rapid development during the quarter.

All right. And have Sensrad lost any customers within this period or is it merely that orders have been delayed and more competition has entered?

Not that we have been seeing in reports or information provided by Sensred. So to our knowledge, from an owner and board perspective, we haven't seen any lost orders. There's primarily delays and changed timelines from Sensred's current customers. We strongly feel that not being able to win new customers is also a market indication in that segment.

Sorry, could you clarify that last bit?

Yeah, and part of the market condition that the change market condition that we see during the second quarter is also that we haven't or Senstart haven't been able to add new major customers as expected earlier in the year. And we're assessing why that is and also the companies adopting and making sure that it has the right focus towards the right market segments.

All right. And I believe earlier when we have spoken about Sensra, defense has been one of the segments that it gained some traction within. Is that still a market that you feel is a core market for them going forward?

For unmanned or autonomous ground vehicles, yes. But defense is a wide area. It can be drones or anti-drone systems, communication, etc. But Sensra's niche and where they've had customers is smaller ground vehicles that operate autonomously and unindependent from any communication or GPS systems. And that's where we still think that their focus should be.

Alright, that made sense. You have about 19 million SEC or so in outstanding receivables to Censra. Do you feel that, given that you are writing down the state within the parent company at Gapwaves, do you feel that there's any risk or challenge that they might not be able to pay you back this amount over time and potentially require more capital from you guys?

Nils?

We don't guide on what capital needs they have but they are working on, as Jonas mentioned, they are working on adjusting the business accordingly and we believe they will be successful together with us and the other owners and therefore we kept the receivables on the balance sheet. So it's a different assessment between the equity side and the receivables.

Alright, that made sense. And if we go back to gapwaves and the Q2 quarter, it was a bit of a disappointment in terms of sales. This is partly explained by the product equipment not being sold in this period and also the amount of projects essentially. Should we think, as you are ramping up the volumes for your product, should we think of Q2 as a froth or should we expect to be a bit similar developments in H2 essentially?

I think the launch phase, as Jonas mentioned before, the launch phase is a matter of quarters, not weeks or months. I think that's really important. And it's a normal transition going from a very design project focused company to a company which sells products. and that ramp up will take more time. The thing with project revenues is they come in chunks and they are a bit more volatile. You never know when they come and how fast they can be canceled as you have seen, for example, in Q2 last year. So I think it's, When modeling it, I think it's fair to say it's, if you just look isolated at the Valeo case, this will take quarters, not month. Sorry, do you want to add anything?

No, I think you summarized it and I explained it well.

All right. So if I understand you correctly, we should think about the Valeo as a gradual ramp up over quarters, and then we have the project revenue and equipment on top of that, that is more volatile.

Exactly. And a word to the equipment sales, I think it's really important. It is an integral part of our business model, right? It's a competence we possess and we always will aim to sell production equipment. Now, this only happens when you set up a new production line. for a customer. So as it is an integral part, yes, but it won't happen every quarter. It's linked to setting up new production lines, essentially.

And specifically, When a new supply contract is being entered into during industrialization phase, then there is a firm timeline on when the production capacity needs to be available. And between that announcement and start of production, that's typically where we see the production equipment revenues.

Perfect. And you have highlighted for some time that you see a more challenging automotive market. Customers are a bit more undecisive if they want to go forward with a project now or wait a bit. With this in mind, how does the project revenues look in the H2? Are you happy with the level of engagement that you got going right now or would you like it to be at a higher level?

Of course, you know, being in the company management, Nils and I would and everyone else would have liked to see more. However, the discussions we have right now have been ongoing for quite some time. We're confident about the progress being made in those discussions. So we're quite optimistic that we will see some of these materialize and they will be substantial in terms of adding to Gapwaves revenue base in the coming years. You know, automotive is always long term. On the other hand, it's quite predictable once you go into production. and you have good visibility at that point. So yes, in short, we're positive about the current situation. And yes, we would like to have more of them. But in today's world and macroeconomic situation and uncertainty, and especially with the pressure on the traditional automotive, say in Europe and North America, We're doing quite well in those customer discussions, and so we're optimistic.

Maybe to add there also, I think it's also underlines the importance that we diversify our revenue mix, not only on project revenues, but also on product sales, which we are doing now. And secondly, also into other segments, not only automotive, but also, as Jonas mentioned before, in cabin radars, et cetera, et cetera, defense is an interesting segment. So really important to have a more diversified revenue base.

Alright, that leads me into another question I had. Now that you have done the handover of the volume production to China, I'm a bit curious what are your top priorities in the near term? Is that broadening and diversifying the revenue base and have more short-term revenue opportunities? Or where are you spending most of your time now? What is the most essential part to get in place?

The most essential parts are, of course, going through this ramp up with Valeo and getting into those really high peak volumes in the coming years. And like we discussed already, adding new business segments and entering into new market segments. And of course, adding more customers within automotive. They time their products, radar products differently So obviously Valle and Hela are already in production now. We have others lined up also that we will focus to move forward and also move into industrialization and eventually after that start of production.

All right. And if I'm not mistaken, I believe in the past you have talked about DSA with a start of production target in 26, if I'm not mistaken. Is that still something that is relevant or has anything changed there?

No, it's still according to plan. You know, recently we communicated that we delivered the 300 samples that are being provided to the OEM customer of DSA. And the timeframe is still, you know, end of late this year for startup production. So we don't have any other information and we haven't seen the project deviate from that.

Alright, so that sounds reassuring. We have a few external questions as I mentioned before and one of them is how many car brands and car models are on the road today using Gapwaves technology?

Yeah. Well, with the Geely news today, you know, that they makes Geely, but you know, there might be other brands with, or manufacturers within the Geely group that utilize this. And then we have Mercedes-Benz of course, and the CLA cars. So there's a couple of models there as well, but from, we understand Valeo has been quite successful. in the last one and a half years to win awards from other OEMs. So we expect this number to increase quite rapidly. And I think I know what your next question will be. Of course, yes, we will communicate such OEMs and cars and models once we have that information and in accordance with approval from our customers.

You're reading my mind. Regarding the accelerated order from Valeo, there's a viewer wondering what exactly does that entail? Are you providing production equipment? Are you doing anything else? What are you doing here with the Valeo acceleration order?

Essentially, we're speeding up production and adding more capacity earlier, resulting in more deliveries or higher volumes to Valeo this year. So that is what this order is about.

Alright, and then they are wondering about ARB competing with Sensrad. How do you view this offering with its own imaging radar sensor and has ARB developed an in-house waveguide antenna?

To our knowledge it's not a waveguide antenna solution, it's a traditional antenna solution and I think that the defense market and the type of market that both Zensrad in general, that both Zensrad and Arbe are addressing is quite big and has a lot of opportunity. So I think with a coordinated approach, I think this will benefit both companies in developing the market. But concretely, no, it's not a competitive waveguide antenna solution. From our understanding, it's more a basic antenna, a traditional PCD antenna solution.

All right. And relating to SenseRad and its framework agreement with Tianyi in China, how much of the expected 7 million euro order has been delivered to date? Is that something you can comment on?

I think this is really Sandstorm that has the detailed information. I think we're behind the TNG's original time schedule or rather their Chinese city rollout is behind the initial schedule. On the other hand, Sandstorm has provided several hundred units and they're also planning for upcoming deliveries to TNG. But the actual detailed information is actually something that Sensrod knows better than we have.

Alright, and we are also wondering about Sensrad's FCC and CE certification process. They expect the timeline approvals and whether the radar sensors can be sold in the US and the EU before these conditions or certifications have been reached.

Again, a detailed question really for Sensra, but apparently they are allowed to sell to their US customers as well as European customers. I know or we know that Arbe and the ship supplier and Sensra have shared efforts here in terms of FCC, especially because that's fairly expensive and CE certification. So I think that information is better answered by Sensrad. But apparently they supplied Unix in both regions.

All right, that's great. And perhaps a similar themed question here, Dan, is that there's been a lot of talk about ARB ships being used in military sector via, for example, Sensrad using your antennas. Are you aware of other antennas being used and delivered for ARB ships?

As I mentioned in the previous question, there have been other radar sensor versions using ARBE chipsets and traditional lower performance type of antennas than the waveguides or GAP waveguides from GAP waves. But I don't have any specifics on ARBE's business. We've seen that Arbe is now looking at non-automotive segments more closely than before. It's natural that they try to adopt and offer different solutions to different customers depending on their performance needs, of course.

Alright, that makes sense. Can you tell us about the satellite project that runs with Satcube, please?

Yes, it was completed. And right now, as we have discussed before, essentially the SATCOM market is not utilizing the higher frequencies yet. There are some discussions ongoing or very early discussions on utilizing frequencies over 30 gigahertz. And that would trigger a need for better antenna solutions or lower loss antenna solutions for those frequencies. But the SATCOM industry is not the area. So to our knowledge, no one is utilizing such high frequencies. But we have been in discussions with not only SATQ, but others as well. So we'll see. Maybe defense side will move this development faster because of the needs that defense applications may have.

All right. And then we have a viewer asking about the Hela's next generation radar. How is that developing? Is that still on track as you expect or any changes happening there?

Yeah, I mean, gapwaves have completed the development of a number of antenna variants for this new generation called Generation 7. There are some initial discussions on even the next generation, but actual work has not been started there yet. We understand that Hella is out in the market trying to win. contracts for their new generation, the Generation 7. But aside from a high resolution contract announced in December last year, we haven't seen or we haven't learned about any progress for Hella there yet. But it's still a very new product. I think there's still ramping up on their generation 6 radar sensor also.

All right. And with the end of Hela's exclusivity on the horizon, have you seen any extra interest in corner radars?

Yeah, we see a growing interest in corner radars and we've done that already since more than a year. The headlight exclusivity is not a limiting factor and has not been for the last 1.5 or 2 years. So there's been quite a few potential project discussions with various tier ones. But again, it depends on where they are in their product lifecycle and how they progress in their discussions with their customers, the car manufacturers. So we've seen, for instance, which you and I have discussed before, that over the last year or 1.5 years, Valeo seem to have been very successful in winning OEM awards for corner radars based on the public news that they communicate. So... Yes, I think that there's quite a bit of potential in the corner radar segment. And we also see some progress in the high-end imaging radar also, but mostly for robotaxis and transport type of vehicles.

Alright. I don't think you would like to provide too much details on this question, but I will try anyways. They're essentially asking how much the volume mix between Hella and your other customers, what does it look like in terms of the volumes produced? We know that it's a majority of the HeLa, but that could be anything from 50% and upwards. So is there any more detail you can provide around the mix within the units produced?

No, we can't. The answer is the same as before. It's just two customers and the two antennas that are being produced and going into detail there would disclose too much information. for our customers and in relation to their competitors. So we can't share that, but it's a majority. Let's stay with that for now.

All right. And then we have a viewer here asking about if you have any form of exposure towards photonics. As you are well aware, there's another Swedish listed company that has gained a lot of share price appreciation due to its photonics links. And they're asking, do you have any form of exposure to this type of sector?

Photonics? No. We're an RF company, so we're involved with radio type of frequencies, although high frequencies. But photonics, no. And I'm not well read into what that company, you know, the development of their markets, etc.

Alright, and I think we have run out of most of the questions. I think we have answered most of them. I will give the viewers a last chance to add their questions if they have any further. In the meantime, I would like to ask if you look at your The pipeline of customers you have, you have four phases essentially of developing, of signing a customer to volume production. And I'm curious, how has each of these phases or stages, the number of customers in them changed over the last year and perhaps versus two years ago?

It has actually grown in the early phase, meaning concept and project discussions. The difference here which Nils and I have highlighted and that you have also recognized earlier, Rasmus, going from those discussions into actual projects and then as they complete the projects into the industrial phase. And it's actually in those two steps that we've seen some hesitancy from customers due to uncertainty. You know, it's been tariffs, it's been no tariffs, it's been increased tariffs, it's been uncertainty on the military side. So I think our customers and their customers have a difficult situation in trying to decide on long-term investments and when to push the button. But I think for us, you know there's also some other market drivers that are very important you as a car manufacturer you cannot avoid fulfilling legal requirements on active safety features in cars for instance in the EU or North America so there is a a certain limit time limit to when you have to make those decisions so we remain confident about the development in the automotive market and and where pretty much agnostic to, you know, which car manufacturer, if they're Chinese, Korean, Japanese or European or North American, because they all have to comply with the same requirements. So what we see is that customers are getting closer to that time limit where they have to make certain decisions and implement certain features. And that means for tier ones that they need to have those radar sensors available and ready when the cars will need it in the production line.

Alright, and this time limit you're speaking of, is that the same time limit for everyone? And when is it?

Yeah, legal requirements are the same for everyone. So it depends. I mean, new requirements are being put in Sometimes there's every year or there's maybe two years in between new requirements, but we see both EU and North America implementing higher requirements for better performance in the active safety features like emergency braking or lane keeping assist systems etc. So it's quite easy to find a background for this in the news and in the authorities documentation also. So there's quite a clear timeline. And radars will be part of that. It's a requirement to make these features work in all weather conditions also.

All right. I think we have gotten answers to most of the questions that we have received today. So without further to do, I would like to hand the word back over to you guys if you have any closing remarks.

Yes, thank you, Rasmus. It's been a good setup here and a lot of questions. I'm happy to see that it indicates interest for gapwaves. So we're Happy to do that. If there are questions that have not been answered, you can submit them afterwards and we'll try to share the answers with Rasmus and between Gapwaves. Also, as an investor, I think keep your eyes on news coming out from Gapwaves in the coming months. about new developments, new customers, but also the scale up that we're going into. And as explained both in the presentation and in the Q&A part, we also expect to enter into new market segments in the near future.

All right. With that, I thank you very much for being here with us today. And I thank all of the viewers who have submitted questions and viewed the live stream. Thank you.

Thank you. Thank you.