Net Insight AB (publ)

Good morning and good morning to you and welcome to the Q3 report for NetInsight. My name is Krister Fridsson, the CEO of NetInsight. I'm glad to have our new CEO Cecilia with me today. First call.

Thank you.

Welcome and also our AR manager Linda is also with us today. If we move over to the agenda, similar to last time, we will go through some highlights, business overview, media and time synchronization. Cecilia will take the financial and we do outlook in the end and moving over to Q&A after the outlook. So if you look into the highlights of Q3, We can definitely see that our focus on delivering high quality and flexible media transfer solution continue to drive revenue growth. And as you can see in the report, the revenue growth corresponding with the last year was an increase of over 8%. And if we take in comparable currency, it was just over 12%. So this is strong growth in Q3. And we also have a positive profitability trend and we are close to 16% EBIT margin. So the underlying business shows solid performance and profitability. And at the same time, we are simultaneously also making long term investment, both in the synchronization part of our business, but also in media. We are building up the organization primarily in the sales organization and we continue to have a high investment in our product. This quarter we have a solid cash flow close to 28 million excluding share related transactions. And if you look into the development costs we see that it's going down if you compare with sales and we have done a number of different activities really to lower costs in R&D but also be much more efficient We have communicated that we close the Cameron Realty R&D site in California in the beginning of this year. But we also are working with the consultant rates and hire more permanent employees and lower the consultant rates, which also have an effect on the cost. And I'm especially glad to see the strong interest in Syntai from leading telecom operator in all three regions and ITU standardization process progress according to plan. And we probably will see the standardization will be ready in 2026. It's a progress that will continue during next year. So N25, 26, the progress, the standardization will be ready. If we move over to the business overview, you can see that we have a strong growth. And if you're looking back all the way to 2021, we had a strong growth. So we had been successful to find a growth pocket in the market. That was like the strategy that we look into when I started really to find the growth pocket in the market. And of course, to meet the customer demand of more advanced products. We kept our firm's strategy focus, and it's resulting in solid growth the last 12 months with 32%. And as you know, our long-term financial targets have a growth of 15% over a year. So on back of the increase sales, operating profits are growing the past 12 months with 16% to over 16%. So that's also a strong growth, strong profit. we do see that the third quarter tends to be strong due to the start of sport leagues which drives increased investment and that's globally it's in europe and it's us normally the the sport leagues or the sport contracts can move between operator and normally it's it's made between q2 and q3 and that can drive investment when you're taking over a license for a sport league. We can see short-term revenue variation continue to influence by timing of major deals with key customer. That have been gone down when we are, of course, increasing the sales, the larger deals has less effect, but we can definitely see an effect of larger deal between the quarters. Yes, a quick view of the sales per region and sales per our products. As you can see in the graph, we had a strong growth in Q3 in the markets. And it's actually the second quarter we have a strong sales in the markets. Last year it was quite a turbulent year in the US. Many of our customers reorganized and cut down the organization, which also affected our sales to our major customers in the US. But we see this year that they are coming back and are investing again. So the US market going forward is definitely a market that we will grow and that US market is the first growing market globally and it has a larger growth than the average if you look at the global market. So that America is a keystone and a building block for our growth journey going forward. The software license sales we have will over time result in high-level recurring revenue. As an example is the large software deal that we made in Q2, close to 30 million Swedish krona. And that will generate recurring revenue going forward. So that is a focus that you have to increase the recurring revenue and the license sales that are going up. So that will be a focus going forward as well. And that's a change in our product that will be more and more software compared with the less hardware sales. Here's a quick view on the media. We have a very positive trend within the media. So the revenue in Q3 was primarily driven from business with the existing customer, but we also received additional orders from new customer. So with the new IP based product portfolio that we have invested in the last year, our definite aim is to win new customers, and especially in the US. With our IP product portfolio, we are much more competitive in the US. The US market is much more focused on the IP, and now we have a product portfolio that can gain market share in the US. We also very glad and proud that our Nimra 400 recognized as the Innovation Award winner in IBC in Q3. And then was a partnership with Verizon together with National Hockey League. So two very strong brand names together with us were recognized as the Innovation Award winner at IBC. That's really, I'm glad to see that. As we had been communicated earlier, we see a strong growth opportunity in cloud and we have invested in last year a lot into the cloud market. And we have a unique position in that market segment. We are one of the few that deliver both the cloud and the hardware. And that combination is quite unique. We have many competitors either or, but we have both and that is definitely an advantage for our customer. So as a step in enhancing our competitiveness in the cloud market, we launched the compact and cost-efficient Nimble 2.4 in Q3, which enabled fast and easy production of smaller events from any location. We are also in the phase of upgrading our existing 400 platform, both the hardware and the software, and we will continue doing that during next year. When it comes to live media transport for high prestige event, we see a growing demand for significant greater capacity, especially in the US. In this area, we definitely are the market leader. And as you know, we were one of the first or even the first that actually launched the 100 gig platform 1060 2018. And we now are launching a 400 gigabit platform. And that will make a possibility for our customer to lower cost and increase capacity. So a number of our customers are looking into high capacity. And this will be the first 400 gigabit platform for media. so we are first with 100 gig and we are for first with the 400 gig products so that's definitely a very important step forward for us and we will see the product be delivered in the end of next year beginning of 2026 the product will be in the market with the rapid development of i i e i i AI, sorry for that. Difficult to say. AI is we see that the product lifecycle concern and programmable FPGA have shortened. That's a key components in our high capacity product. And we are using the most advanced FPGAs in the market. To ensure delivery of high volume products, our 1060 and 600, we are proactively working to secure the necessary supply of FPGAs. A consequence of this is that the inventory level will go up and the capital tied up in the inventory of these high value components will increase over the coming years. If I move over to the synchronization product, we are definitely pleased to see extensive interest in our Syntar product from leading telecom operators in all regions. We currently have around 10 commercial customers and we have significant number of ongoing proof of concept. Among the complete POCs, a majority have successfully advanced to the next phase. I mean, important to remember that we have communicated earlier, it's a number of steps and many different phases before it will be a full launch of a Syntai or a Syntai network within the operator. The different phases like the PUCs and the PUC can be a many different step. It can be a lab test. It will be a test in the open network. Network planning definitely. And we see now also that our customer needs to secure your budget for the build out. So we see a number of customer looking into the budget for next year to be able to launch and roll out our product. We have a strong PUC to contract conversion, and that definitely is a testimony to the strength of our product. As you can see, the order pipeline had been going down to 175 million krona. And then the pipeline or the order book actually is not a pipeline, it's an order book with a large portion of the order book is coming from Turk Telekom. And Turk Telekom have been taking the first supply in volumes in Q3 of this entire product. So the decrease is coming from delivery. And we see also the strengthening of the Swedish Krona against EUR and US has also been taking down the order stock a little bit. As I mentioned, I'm very pleased to see that the ITU standardization process of time synchronization technology, which started in December last year, is progressing as planned. And during the quarter, the first document was approved during the quarter, and I'm looking forward to the process being completed, as I mentioned earlier, in N25, beginning of 26. That's the forecast right now. Okay, that was the end of the introduction and we are moving over to Cecilia on the financial.