Net Insight AB (publ)

Good morning, everyone, and welcome to the Q2 presentation from NetInsight. My name is Andreas Ohlsson. I am, as usual, responsible for the NetInsight coverage here at D&B Carnegie. And with me today, also as usual, I have the NetInsight CEO, Andreas Eriksson, and CFO, Cecilia Högård-Hök. We will start with a presentation of the quarter and then open up for Q&A. And you are most welcome to send in questions via the website. I know some of you have already sent in a lot of questions, so thank you for that. But first, I leave the word to Andreas.

Thank you very much, Andreas. Good morning, everyone. Yeah, let's get into the Q22026 report. So we'll go through an overview. We'll then deep dive a bit into business review, looking at the media as well as the sync side. We'll then go, Cecilia will then cover the financials, and then we'll wrap up in a summary, and then, as Andreas mentioned, open up for Q&A. So if we start with the overview, so this quarter two, net sales amounted to 91 million SEK for the group compared to 143 SEK for previous years. And the shortfall for the data between Q2 last year and this year is really driven by the absence of larger media orders in the quarter. And we thought we'll unpack this a bit because I think this is a question that many might have. You know, what's driving this difference? And I think if you, you know, if I zoom out a bit looking at the NetInsight business and the revenue customer base, we have a very large installed base, you know, many customers around the world, which gives us a really strong foundation. For the most part, these customers have chosen us, the technology from NetInsight, and we continue to support them when they build out the network, extend the network, refresh the network, and so forth. That's sort of the one thing that's important to know, the breadth of the customer base. The other thing to note then is that our revenue base is significantly impacted by large projects, which means, and this is driven by predominantly a few of our largest customers, which also they come in with large media orders to us at the back of large projects. This project will be driven by different things. There could be some major uplift in their infrastructure, and that could be related to capacity uplift and so forth, and major refresh. It could be driven by if they win a large deal, could be at the back of a media right, that they need to do some major uplift of their infrastructure. It could also be driven by new services that they launch, different drivers that drive large significant media orders. The situation then is that these large media orders, because of the sort of swing effect they have, depending when they occur, That means that there could be a significant difference between quarter to quarter when you do the comparison. And if you look at Q2 this year compared to Q2 last year, so Q2 this year, as we stated here, we didn't have any of these larger media orders in the quarter. whereas in last year we did. So that sort of explains the majority of the difference here when you compare quarter to quarter. I think what's important to state, though, when you think about these large media orders is that they haven't disappeared in a way. We still expect large media orders as part of our business. That's been part of the business for the last few years. But again, the timing of them and so forth is the challenge in a way when you look at a quarter-to-quarter comparison. If I then move on to the EBIT side, again amounted to minus 26 million. As many of you know, we have a very, there's a lot of leverage in the business, so that means obviously a very high gross margin, which means if we have a lower revenue base, that flows down very much in a very big impact on the bottom line. So that's just, and obviously works the other way around as revenue growth. If you look at the quarter, we really feel that we have some really good progress in terms of strategic priority. We have set both for the media side as well as for the sync side. On the media side, we have launched a Nimbra 520, which I'll talk a bit more about where that fits in. That's been progressing well. We got the first customer orders for that during the quarter, and we continue to have some good progress on the time synchronization sales funnel, as I'll explain more in detail. The available liquidity amounted to 165 million SEC at the end of the period. And again, as I mentioned, the focused action we've taken to strengthen commercial execution, drive a broadening of a customer base, and then improve this conversion, in particular on the sync side, is what we are focused on at the moment and will continue to do so. If I then summarize what we talked about before, again, the focus actions that we're taking is driven around three areas. And the one is to enhance the media portfolio. As I mentioned here, we have launched a 520 where we're starting to get the first customer orders. We've also brought on a new version of the JPEG access. The JPEG access is one of these major compression technologies that we have in our product. We now have made a major uplift of that, which means now we're now kind of the market leader in that specific area. And we've also there seen some first customers coming on board on that technology. If you look at the middle one, increased sales efficiency, here the focus is very much on the North American market, where we think we have a really good opportunity. We think it's underserved for us. We think we have underlying potential there. We want to get into new customer segments outside our traditional customer segments. And then, of course, as we now build a good market interest for our products at the back of launches and then at the back of future launches, we want to make sure that we get customers on those over time. as we stated his second customer for 400 gig solution. 400 gig at this moment is relatively niche. It's for the really our largest customers. They'll change over time because the capacity requirement will be increasing throughout our entire customer base. But at the moment, it's relatively sort of few that sort of see the big demand for the 400 gig. But getting a second customer is very positive for us. The second thing is, again, growing into new customer segments. As we said, we now have two of the global media and tech segments as our customers, which is really pleasing to see how we can continue to grow with them. If you look at the last part and on the time synchronization side, again, as we said before, you know, really this year is about driving conversion, you know, of the opportunities we have in the pipeline, make sure they progress, you know, trials, pilot, and then moving on to customer role. That's really the core there where we see, again, as I'll deep dive a bit later, we see good progress. So that just gives you a snapshot of the improvement areas that we are driving and the progress we're making in each of them. If I then go in a bit more detail, we'll start with the media side. Again, as I mentioned, the media revenue was low this quarter, as I explained, in the absence of large orders through the quarter. However, you know, the work we're doing and expanding the portfolio is really working. You know, we've launched the 400 gig. We have launched the 520. We're getting customers on those, which is really pleasing. And we also, for the 520, have a number of customers that at the moment are testing the technology and the product. And we have gotten a very positive response from that product from the market. So that's positive for us. And then, as I mentioned, the JPEG Exodus, other compression technology, we made the major uplift this year. It's been used now for a major international sporting event throughout this summer. So that's really exciting for us that the latest tech is being used already now into some of these very high-end sporting events around the world. So to summarize, I guess, the expanded portfolio, it's really, you know, three areas, you know, the high capacity, obviously one area, the internet, the cloud-connected area. So this is, again, where the 520 fits in. And then the distributed production environment, you know, again, remote production. And when you don't do production at the venue, but actually from home base or from a central place, again, the solutions that we are developing is continue to, you know, support those core trends in the market. So, again, we feel that the product launch is in the focus is to convert them now into more and more customers and repeatable revenue, but then also, of course, to make sure that we are expanding our customer base. So if I just sort of zoom out a bit and think about our growth strategy, as we talked about before, the portfolio growth plan is really around, of course, strengthening where we are, but going deeper into the areas where we are already present, plus then grow outside into new markets. If you look at the lower left, what we call managed fiber, That's sort of the current core market. So what we're doing there is to make sure, of course, we want to grow the installed base of the customers we have and want to sell more to them. So that's sort of, I guess, you know, obvious. But then also we want to work with them to be able to serve use cases that we do not cover today. So there are certain situations where, you know, we might not be able to be kind of present in a strong way and not be competitive for certain use cases. So that's part of the portfolio expansion. For example, we're towards the end of the year we'll be launching a smaller version of the 1000 series which will fit into certain use case again where we are not so competitive today. So again going deeper and increasing a market share in that area. Again, same there. We want to grow into the new customers within the segments we already serve. One. Two, we want to go outside the current customer segments that we serve today. Again, as I mentioned, one being this global media and tech customer segments. That's sort of the strategy there. IF YOU GO RIGHT THEN INTERNET AND CLOUD SO THIS IS AGAIN WHEN YOU USE INTERNET OR CLOUD AS THE UNDERLYING CARRIER AND ON TOP OF THAT YOU BUILD LIVE MEDIA SERVICES FOR TRANSPORTING LIVE SPORT SO THAT'S REALLY A FAST GROWING SEGMENT SO WE WANT TO WE'RE GOING TO GET IT WE'VE BEEN WE'RE ACTIVE THERE BUT WE HAVEN'T BEEN SO COMPETITIVE you know what we see now with the 520 launch and the traction we're getting is actually now we can in a much more meaningful and powerful way be active and win business into that fast-growing area so that's really you know exciting for us you know we want to then make sure we continue to do that so we can scale that business up you know in addition to the managed fiber area we have. So that just gives you a bit of a snapshot on how the strategy, what we're doing, fits into the time growth and also the traction we are having in the market and what we're trying to achieve as a business. If I then jump on to time synchronization, time synchronization revenue increased to 12 million compared to 4 million in the previous or quarter last year, Q2 2025, 4 million. Turk Telecom rolled out, that continued well. We now have over 1,000 nodes installed, so this is really exciting because obviously that gives us a really... strength and reference value in the solutions. Other operators look to our technology. It's important to have a really strong reference case, not just that a certain customer is using it, but they're using it at scale, which is quite a different thing, which is really where we are strong. And the third point here, partner ecosystem. We now have 23 Sync partners, which are really partners for, you know, channel, you know, resell partners. They also will help us with integration and rollouts as a customer want to do that. So we get the muscles to be able to deliver at scale as well over time. One of them is the WWT partnerships, which we have, and that's quite an exciting one. Predominant WWT is really about accessing customers in the U.S. market, but also elsewhere, but in the U.S. and Americas is where they are particularly strong. And as some of you might know, they also brought some of our technology into the future labs where they test and trial new products. new technology solutions for the future, which is also sort of a part of that. But predominantly, WWT is really about the resell and the channel to market for us. On the commercial trials, you know, we've been doing outside the 5G market. It's been exciting to see that we have had some commercial trials also on the media side, and we're getting some on the defense through partners. a bit sort of, I guess, you know, we want some media customers, you know, as we highlighted last year, or last quarter, sorry, but then also getting into the fences in another area, which we see a bit more interest. On the standardization side, there's been some good progress there, where the technical work in the ITU standardization body for the E-PTS Standard Supplement, technical work has been completed and agreed in that forum, which is a good step. And then now what will happen is that you now need to document this technical work and document down what has been agreed. and then you approve formally the documented endorsement. So that's sort of the next step. So we expect that the ITU approval will be at the next plenary meeting in February. So there'll be work then to do this final editorial updates and document the agreement and then that will be formally endorsed then. So again, just to summarize, I think, on the time synchronization side, positive long-term outlook remains. Again, as we said, short-term revenue contribution is expected to build gradually as we progress more customers throughout the sales funnel. And doubling down a bit on the sales funnel, here you can see the movement since we reported last time. So another two proof of concepts, another two customers in field trial phase, and another two in the pilot installation phase. And the one sitting in rollout is the media customer that we talked about in last quarterly report that is currently being rolled out. So with that, I'll hand over to Cecile to take us through the financials.

Yes, thank you. So, starting with net sales, and net sales for the second quarter was weak, as Andrea said, and amounted to 91 million compared to the 143 million in the second quarter last year. Decline was driven by media, and media revenue amounted to 79 million, and it did not include any larger order, whilst the comparison period included one of NetInsight's largest orders in history. Revenue from time synchronization increased to 12 million compared to the 4 million in the same quarter last year. So now to profitability and starting with gross margin. Our gross margin for the second quarter remained high at 68.6 and this reflecting our scalability in our business model. Our operating expenses declined with 4% year on year. And then our high gross margin and our relatively fixed cost base, with the shortfall with revenue, this has a significant impact on our earnings. And the earnings for this quarter, we had an EBITDA on a minus 3.8 million. So now to operating earnings, and operating earnings for the second quarter was minus 26% compared to breakeven if we exclude the one-offs last year. And the low result is driven by the low revenue in the media. It's important for us to have these activities that we are now doing so that we can turn this revenue and increase it in the future. Cash flow. Our operating cash flow for the quarter was 3 million compared to minus 35 million last year. And the difference is mainly movements in working capital. If we deduct the investment activities of 22 million, our total cash flow for the quarter amounted to minus 19 million. At the end of the quarter, we have a cash of 80 million and an available liquidity of 165 if we include our unutilized credit facility. After the year period, we have in July signed a 130 million revolving credit facility, and we have incorporated the previous credit facility in that one. And we have done this to strengthen our financial flexibility and to support our ability to continue executing on our growth initiatives. So, Andreas.

Thank you, Cecilia. So just to wrap it up, as I talked about before, when you look at the strategic roadmap where we address the current challenges we have but set us up well for seizing the mid- and long-term opportunities, they really come in three areas. Again, on the SYNC side, it's all about driving conversion of the opportunities we have in the pipeline. On the media side, it's a two-pronged approach, as I've highlighted before. On one hand, enhancing the media portfolio, strengthening it, as I explained on the previous slides. And then on the sales side, it's really about driving sales efficiency. And it's, to a large extent, focused really on getting into new customers and new customer segments. That's really the output part. we want. Of course, we want to upsell as well to our existing customers, but we really have quite a special focus on this new customer and new customer segments. And I think it's also important to, obviously, media, the portfolio, and how you bring things to market. That's a very tight collaboration between the product side, the marketing side, and the sales side. We're doing a lot of work to make sure that that sort of revenue machine that we have within the business is working really well in harmony together so that when we develop new solutions that they're well tested and so forth, we bring them out in an efficient way, make sure that our sales partner or sales force in-house is well equipped to go on and win customers on this new technology. And then, of course, that we have a really strong sales team and good ways of working. But the number of components we're working on for them to come together as one. So if I just sort of summarize the key points here, again, Q2 was weak, mainly due to the absence of larger media orders. We really feel we're making some good strategic progress in both the area of live media and time synchronization, although I appreciate that we don't see it fully, we don't see it in the numbers, but we can see that the progress is happening. As Cecilia said, you know, we are really tight on the cost side, so that continues to be in place. Again, on the media side, you know, the positive effects on the portfolio, the work we're doing on commercial execution is really important. Again, will happen and will have significant financial impact over time. on the time synchronization, you know, very similar, you know, good, you know, there's progress in the pipeline, as you could see. But again, of course, we want, you know, things to move, to roll out where it becomes more meaningful revenue contribution. We expect it to build gradually. In terms of the long-term financial targets remain unchanged, but though, as we've said, the timing towards 2027 is challenging. So that's the highlights. So I think then over to some Q&A, Andreas.

Yes, and we have quite a lot of questions. So thanks for that. And I will take them in order. When we look into the autumn, it feels like time synchronization will compensate a little bit for the weakness that we see in media. But with regards to the target that you mentioned, how should we put that target for 27 in perspective, given what you see in the market right now?

Yeah, and I think as we said, I think we look at the targets, the numbers that remain unchanged, but of course the 2027 is looking very challenging. I think that's fair to say. But I think we're now building towards putting things in place to really be able to bring the business back to Is there a discussion in the board to update those financial targets and maybe more long-term beyond 2027? Yeah, I mean, of course, this is something that's, you know, being reviewed, you know, as part of the board work. So I think that's, you know, absolutely something that's, you know, is being discussed. But I think that's sort of what we're communicating at the moment.

Then ITU ended their conference in Montreal a couple of weeks ago or one week ago. How did this important meeting go for NetInsight?

Yes, as mentioned, the IT work that I was referencing was at this Montreal meeting where the technical work, you know, there was agreement around the technical specification and works. And then what needs to happen is obviously you need to document that to make sure that you're agreeing on the exact wording, you know, the actual documentation of it. So the agreement was done at the Montreal summit, and now the next step is to document and make sure the editorial aspect that you make all the edits for actually has been documented. That's the next step. And that will, you know, we expect that to be agreed and formally approved and agreed in February.

So that explains the long sales cycles if it takes to February to edit documents, I guess.

I mean, it's driven by meetings, you know, because obviously this is governance bodies and standardization bodies where the industry come together and talk about, you know, things that should be standardized. So there are some regular meetings happening like the Montreal meeting. It will be another meeting, so forth. So that's basically the cycle. But, of course, you can also say that it's taking some time. But that's, I guess, how the standardization body works in the telecom industry. I think it's the way.

And how important is that standardization? What does it mean for you in terms of easiness to execute on orders?

I mean, I think it's definitely a plus and a positive if that is in place. But we should also remember that we have customers that we have worn that are in the telco industry that have gone and chosen our technology without this in place. So I don't think it's not a blocker. But, of course, it might help. And it will be different from customer to customer. Some are more particular about this and some are not. But I think it also comes back to the driver. All the customers that have chosen us already have the very strong financial and business drive to be able to solve the problems they have and where our technology helps. And I think that will continue to be there. Again, we look around us now with the geopolitical uncertainty, continue to remain. They will need to build resilience in their network, and we can help. So I wouldn't say, again, a blocker. I think the business drive will be there, but it certainly will be a good step forward and a positive for sure.

And given that you are in the industry of transporting data or video and also in security, is there a business case for NetInsight in data centers and all the AI rollout that we are currently investing in?

I mean, at the moment, we are not sort of active in that area. But you can, I mean, of course, they need time synchronization and so forth. You know, they also need a similar thing. But when you get down into the details, it's not just obvious that on the highest level it's an id. You know, then you go into a data center, and then it's a different use case if you're in a data center, you know, where we made your is more in the wide area network when the network is spread out so that you can see use case between data center, for instance. Of course, you know, I'm not ruling out that there is a role for us to play there at some point in time, but at the moment, you know, we're really quite focused on getting traction into the 5G market at the moment. But of course, we're looking, as I highlighted, on other things, you know, media, you know, the defense area. So we're definitely not just, you know, we're looking into other areas which could be active and and, you know, data center could be one of them. But for me, it's been very important to make sure we get some traction and we get focus in the organization to make sure we break through and dig a bit where we stand, you know, to get traction because you get traction in this industry, it's easier to come into another industry if you've got some, you know, established presence and you know that the technology has actually been deployed. you know, across the world for multiple, you know, five-year customers, you have some strong reference case. And it's also not just you run from one thing to the other, but you stay a bit focused, you know, certainly in the short term. I think that's been our priority.

There has been an ongoing discussion of a better communication with shareholders. And given the profit warning, you might want to know more about how does the visibility look like in a business like this. For instance, how large part of the quarterly sales is generated in the very last few weeks of a quarter and so on. Is there any... Thank you very much.

You know, the quarterly reports, you know, where we report and try to, you know, bring out some detail and be transparent around, you know, first of all, how the business works, you know, the revenue buildup and so forth, the dynamics around it to make sure it's well understood and people can ask questions around it. So we have established, you know, the same view on the world. I think that's sort of step one. And then in between, of course, we have, you know, press releases on major updates and then other updates that we want to do. You know, and I think that's sort of the baseline for it. But of course, you know, we continue to see could it be, you know, a bit more that we could do on top of it. But that's sort of, I guess, the fundamentals of it. And I think we also want to make sure we remain focused on fixing the fundamental problem and doing that work because I think, you know, again, breaking through on Zinc and and really getting media to a strong place. Again, it's obviously where we really spend our brain time and try to drive that at the moment. So it's also that aspect to take into consideration.

And on the media side and the downturn that we saw in the quarter, you highlighted that there is a lack of large orders and that existing customers are maybe a little bit more hesitant. But could you explain a little bit the environment that they operate in and why they are hesitating and why they are maybe focusing more on on cost reductions and maybe not so focused in investing in new technology.

Yeah, if you look at the traditional players, you know, the large broadcasters around the world, for instance, which buy sporting rights and then try to monetize them, you know, they've been over, you know, quite a few years been a sort of a transformation of that industry. More, you know, you see the viewing going maybe away a bit from some of the traditional broadcasters to other and some of these global media tech and global players. That's sort of one. And that's why we, again, moving with that, you know, to make sure we also can serve those new customers. I think that's sort of one part of the chain. But then when you then look at the monetization and how these traditional broadcasters, and the broadcasters will buy from service providers who will buy from us, or we sell directly to broadcasters, two models, you know, depending on what the end customer wants to do. You know, we also remain open to that. But then obviously there's some cost pressure into their economical model that puts pressure down the chain. So that's the environment. The good news for us is that we have all been very strong total cost of ownership. So when you think about the building of the network, the running of the network, that's been where we have all of us major. We know that when you run our technology in terms of the operational team that you need to have and also the bandwidth consumption if you use our technology, it will be reducing the cost. So I think for me it's an opportunity. I think we can be, you know, of course you can look at the market being a bit sort of, you know, sort of challenged, but then our ability to compete in the market, you know, which is a bit under cost pressure, is actually quite good. you know, when you look at our value proposition that we've always been majoring. So I think what we haven't maybe done as good as we could is that we haven't been so, you know, so specific on how we can actually help and the financial impact we can have on the customer rather having maybe a bit too technical in the way we sell. But actually, you know, we now go and have more conversation around the cost side and how we can help the customer in the pain points they have. So I think that's one part of it. Obviously, when you have a bit of a challenge in an environment like that, you know, the customer will think a bit more, think twice, if you like, before they spend. They might reuse things they have and so forth. Of course, you know, that will be a natural thing that you would do, you know, as a customer. As any company, if you're a bit under cost pressure, you will then, you know, be a little bit more cautious. You might wait a bit and so forth. So I think that's what we are seeing in the market. But again, you know, the mark moving, we want to move with it. That's why we're talking about getting into some of these new customer segments that we can serve. And actually, it's very interesting because when you think about some of these new customer groups, they actually have a bit of a different commercial model. You know, some of them are not making money only by monetizing sports rights, which is a traditional way a broadcaster will monetize when they sell a subscription or advertisement at the back of buying sports rights. Actually, some of these other players that are these global tech and media companies, they actually make money in the in a different way than the commercial model. This is more of a maybe marketing tool or a supplement to it, which means that the way they calculate the return on investment on buying things from us is different. And of course, if they're growing, they also have the muscles to invest more. So it's quite an interesting shift where we need to broaden. Having said that, we also want to get in more into the customer segments we are in. You know, most of us provide more broadcasters. So I think we're not ruling out that segment. It's still important for us to compete. And again, we're going to compete very much at the back of a strong, low total cost of ownership proposition.

And The lack of large orders, that means there are opportunities for larger orders in the market, but they didn't happen in Q2 and slide into later quarters. But you also say that Q3 will probably also be challenging. Yes. So what do you see when it comes to these orders? Is it later this year or could it also be postponed into next year?

Yeah, I mean, I think, as you said, Andreas, you know, I think for, you know, our guidance for, and normally we don't provide guidance, but the guidance now for the coming quarter is, as you say, you know, when you compare to the quarter, the same quarter, quarter three last year, we're saying this will be comparable terms, you know. . . . . . . . You know, I think, you know, they will continue to be part of the revenue mix for us. But I think what's harder to say is, you know, exactly when they come and so forth. I think that's where the challenge lies. And then we'd probably be a little bit cautious, you know, in terms of that. But then, of course, it becomes, you know, hard to maybe understand. And that's why we want to be very clear on explaining, you know, that, of course, when you look at quarter two this year compared to last quarter, everyone would want to look at the numbers and try to understand what's actually happened. you know so that's we want to be very specific that actually when you do this quarter by quarter comparison if you have one one quarter containing you know some large deals as Cecilia said and one that doesn't you know it becomes a big difference you know so so I think that's what we want to explain to the market but really a fundamental belief is that yes there will be continued to be big big you know projects that they need to continue to do they need to do uplift they need to do You know, move to maybe 400 gig and so forth over time. So we believe that it will continue to be in a large order as part of our revenue mix. Again, when they come and so forth is the thing that's harder to predict.

On the time sink side, you talk about having moved on to two national tenders. When are these in time and what type of size are we talking about?

I mean, I think, first of all, to look at these tenders, you know, as a phenomenon, this is very interesting, a bit of a new thing here that we have actually talked about, you know, throughout the year, that we think that as the market matures, we mature, we can actually be Thank you very much. You don't do all the different tests that we have seen so far. As we have highlighted, some customers do two or three different sort of trials and tests along the way to try and prove out the technology that there might be an opportunity to speed things up. So I think that's one thing to state then around the phenomenon of it. We don't guide, I guess, on the size of the orders and so forth, and either on, I guess, time and the size in the monetary terms of them. But, of course, we will communicate that as soon as we know that things have been won and the size of them. But that's sort of the guidance we are providing at the moment.

You are six months into your CEO session or tender. What opportunity within NetInsight do you believe the market currently underestimates the most?

I mean, I think for me, I think we have, on the media side, you know, I think we have a really good opportunity to sort of start, you know, with the product plan, all the work we're doing on improving how we work in the sales side, how we bring things to market, you know, doing, again, a refresh in the product side. You know, making sure that how we work between sales, marketing, and product is working really well, really this sort of revenue machine. For me, that's a fantastic kind of improvement area, you know, which will, you know, for me, give a lot of uplift. I think that's an area, I think, in terms of the media is for sure one. But also, obviously, on the sync side, I think if we, I mean, you know, I think everyone has been Thank you very much. Thank you very much. some of the right things. We've got to then figure out how do we accelerate, how do we do more of the right things. So I see basically in both areas. I'm optimistic we can turn the media side around and build quite a robust revenue base there into new customers and more into the existing ones. More product will mean we can do more cross-selling and up-selling. Because when you look at a customer base, no one really kind of leaves us, really. It's quite sticky what we have, quite ingrained and central into what they do, you know, which means if you have them more things that you can provide them more use case, you know, when you go from only doing manage into the internet and cloud delivery area, you can be more relevant across more use cases with the same customers. Of course, also an opportunity to break in the new customers. I think all that will play over time, you know, that will be given, you know, impact and effect on the financial results as well. So I remain very optimistic. I think, you know, we're doing the right thing. So, you know, it just, you know, should happen a little bit faster.

and Beyond Telecom, which Syntai market is currently closest to commercial rollout and become comparable in size as the 5G market.

I think if you just look at what we're doing now, you know, the one area, and the question is around how big the market is. I didn't want to comment on that because, you know, we haven't sort of done sort of detailed work on that level compared to the 5G market. But where we see interest, you know, is, for instance, and obviously on the media side, where we already won some orders, there are, you know, a little bit smaller deals, but, you know, still interest. And then we also see interest on the defense side. So those are probably the areas where we see currently most interest for us as an adjacent industry in addition to the 5G market.

Also on the Syntai side, you seem to hire people for aftermarket within TimeSync. Is that because some customers are closing in to full rollout?

Yeah, so we're doing two things. You know, when you look at Sync, you know, we have, as I mentioned, we have sort of 37 now opportunities in the POC and so forth, you know, a bunch of customers in portfolio. You know, the priority, as I said, has been drive conversion. Obviously, drive conversion means, you know, on one hand, we've got to be able to move the opportunities as fast as possible throughout the funnel. That's really kind of one thing. And we've seen that we've been a bit weak because our ability, if we go in and out of a proof of concept or a trial a bit too much, it takes longer time. If you can be there and handhold it and have a bit more capacity to work through and finish a whole trial on site over a number of weeks and be on site and help, for instance, that will drive the progress and you keep You know, you keep sort of the progress driven. You drive the customer basically to reach progress. So that's one thing we want to do. You know, that's what we, you know, selectively just strengthening a bit the front line and in particular the technical sales area to do that. And they can also, of course, help with, you know, responding to RFPs and so forth that come. So you have a dual use of them. Same thing with some of the aftermarket that you mentioned, Andreas, that's similar, that they can help on some of the rollout and make sure that, or I'm sorry, on some of the trials and pilots and help with some of that, making sure that we run that tightly. So you have, it's a small team, right? You can do a bit, you know. You know, no one does just one thing. You know, you help out and do what's required together with the business, although you might have different focus. But, of course, also we want to make sure now when you look at the Turk Telecom rollout, the massive rollout, you know, we've got to make sure that we have built resilience in the organization so we have a few people that can help out when you do this massive rollout that we have currently. And of course, you know, for bidding for the future is part of that as well. But also, you know, it's both sort of resilience in the organization to make sure we have some strengths because it's quite specialized, you know, what we do. You know, it's something that you take a bit of time as well to learn. And so I think, you know, again, preparing for the future and shoring up what we have is the drivers for the aftermarket hires we're doing.

More of a philosophical question from my side on the business model, because you highlight in the report that you have some recurring revenue, and that's the good part of having these larger customers, but it's still fairly small, otherwise you wouldn't have this volatility. Yes. And also from a planning perspective with the cost side, even though you have reduced cost, it's still increasing sequentially for a couple of quarters. Yes. Thank you very much. know what type of revenue you have and therefore be able to plan your cost side also in a different way?

No, it's a good question and actually something we're looking into. Because when you look at the current commercial model for the service provider as well as the broadcast, it tends to be a very CapEx-centric model for buying hardware and software equipment, the things we sell. I think part of it is that can we change some of the buying pattern? Could we offer another model to them? Maybe. That's something we're looking into, trying to be a bit open. We already have OPEX-based models. We both have CAPEX and OPEX-based models. It's all there in terms of how we can offer. But it tends to be that the customer tends to lean more towards the CAPEX side of it. Again, that might change, you know, with some of the changes in the markets. I wouldn't rule that out. But that's sort of, you know, I think that's the dynamics there. So that's sort of the customer with the current product. If you then look at new products, for instance, if we're moving more into the cloud and software area, that's potentially an area where we could, where you can, you know, where the current industry is a little bit more subscription, you know, an OPEX-based model. So that we think that maybe that could be an opportunity to, you know, offer ANOTHER COMMERCIAL MODEL THERE AND TRY TO FIGURE OUT THAT. AND THERE IS STILL AN OPPORTUNITY TO OFFER ALSO SOME OF THE HARDWARE SOFTWARE, OF COURSE, AS AN OPEX TO THAT. THEN IT COULD BE IF YOU GET INTO NEW CUSTOMER SEGMENTS, MAYBE THEY'RE USED TO BUYING IN A DIFFERENT WAY. THEN OF COURSE IT'S VERY HARD SOMETIMES TO CHANGE A BUYING PATTERN IN AN INDUSTRY. YOU CANNOT DRIVE THAT YOURSELF UNLESS YOU MAKE IT MUCH MORE COMPELLING. to have an OPEX bed model. And I wouldn't rule out, sometimes we even see combinations. You might want to do CAPEX combined with OPEX. They might say, well, I want to buy OPEX with the things, the sites I know, and then I want to have more of a ramp up in other areas. I want to have a lower step in, and then we grow with their revenue, for instance. So it could be different models that we're looking into. But it's no doubt in my mind that it's very important It's something we are looking at, something we've got to see if we can change a bit and add to our repertoire in terms of having more of a recurring revenue coming in. So obviously, as we know, currently support and services is the recurring. And then on top of it, we have this sort of predominantly capex-based model. But again, could we build another layer with more of a recurring revenue? That's, of course, strategically very important. We need to see if we can do some of that. But at the moment, we're sort of We're sort of, I guess, very much in the same model we have now at the moment. We're sort of quite a CapEx-centric model. Excellent.

Thank you very much. There was a couple of double questions, but I hope I have managed to get all of them. Otherwise, please reach out either to us or the company and we will take it from there. And with that, I wish you all a very good summer and see you again at the Q3 presentation. Thank you.