Teneo AI AB (publ)

Good morning and welcome all. You will find the presentation on the investors.artificialsolutions.com and it is of course the Q2 report. So for those of you who have not done that yet, you can find it there and we'll be going through that presentation today. So I'm going to start with just briefly mentioning Per and Fredrik. I think some of you are new to, at least I have not met and talked to you if I look at the names on the list here. So Per and Fredrik, we came in to the company at the end of last year and have basically done a turnaround of the strategy in the company and our backgrounds are from similar companies to what we are setting up right now It's a software company in the software as a service industry rather than a licensed software company but with a very good basic technology at the back of it. So that's Fredrik and I and we're going to be presenting to you today. The next slide is about artificial solutions and this is essentially the foundation of our journey. It's a company with a very strong technology. It's a technology within the conversational AI space. I will do one slide also to explain that space a bit more. It is today the only one that has 86 languages. It's also the only technology that exists within the Microsoft Azure ecosystem that can collaborate together with Microsoft's products in the same space. And it's a technology which has been valued from a patent portfolio perspective at over $100 million, a very strong technology platform, partially because we've been around for a long time, which means that we've had millions of human-machine conversations that have translated into a corpus of natural language. So we have a body of, a dataset of natural language intelligence, which we can use to then develop, for example, the 86 languages. Our product is called Teneo, and our product that we're taking to market is LUIS to the power of Teneo, LUIS being Microsoft's product within the AI space. It is an enterprise conversational AI framework. It's something that you can build your entire conversational AI solution on top of. Listed on NASDAQ Q1 2019, so a bit more than two years at this point, but the most important part is on the right side of the slide. That's our global clients. We have some very large clients with some very, very nice use cases, which, of course, is what we're building on top of. So Swisscom recently replaced, actually during Q2, replaced their IVR. So instead of dialing in and you press 1, 2, 3, you talk to the system about what you want to solve. And they've experienced a 26% cost reduction and an 84% increase in customer satisfaction with this. AT&T is troubleshooting your home network in the US with this solution without human intervention. Some very, very strong use cases and very, very strong customers around, mostly in Europe and in the US. And that's also our focus going forward, Europe and US. On the partner side, some very strong partners that we've had for some time. I'd like to highlight the few CSG has turned into an even stronger partner in the last few months with some very nice implementations. Tech Mahindra doing some nice implementations. Ernst & Young very active in new opportunities across Europe primarily at this point. But the most important one is Microsoft Azure. We are a part of the Microsoft ecosystem and this is really key to our whole strategy. So that was slide about artificial solutions. I will move to The next one to explain the market that we are in. The market we are in is called conversational AI. It constitutes both the chatbot and the virtual assistant market and then the enterprise conversational AI tool sets. So we are in all those three. We have a tool set which can be used to build a chatbot but also to build a true conversational AI solution. The solution itself is always going to be addressing a user, a customer, a vendor, somebody to the left, the person with a nice blue tie, and that user is coming in saying, can you help me with something? That would be a service request. It would be an information request, action request, decision request. The person comes into the system. The system understands what the person wants, and that's to the right. What language are they using to start off with? Do they now mention people, places, details? For example, if you put a date and a place into a sentence, The system needs to be able to extract those since those are very important data points. What kind of request was it? Was it an actual request, something I need to do now? So the bot also needs to actually do something. Is the user happy or upset? Or have we interacted before? To build this in a large-scale environment, you need a very strong conversational AI toolset. And in the market today, globally, we are positioned as maybe one or two or three and I would say we're number two in terms of size of the implementations that have been built with our system so we have a few customers at this point but very large customers that have built very large implementations of conversational AI in total 10 million conversations happen every month with our software so it's quite strong The market is very big, but it's a replacement market. So the $50 billion market today has a CAGR of 20%. The software vendors are not there quite yet because a large portion of this market is actually addressed by humans today. So the $50 billion is what the market will be valued once we span out the conversational AI space. That's our marketplace. I'm going to move into Q2 so Q2 basically and I would say half year one has built a platform for us which is very important in what we're going to do for because now we can start expanding on this new market positioning this new market footprint these new market references which are very key and there are large customers that we've been going after and we've now sort of done with that part of our expansion and now the next part is building more on marketing and building up the sales organization to build on the success that we've had. So let me tell you about this. The first deal we're not allowed to talk about is happening due to, it is a very large US tech company. They deployed very quickly and we've also now already, our partner that is implementing this has started to implement the next phases of this, which is basically moving this into the U.S. and into Japan, into the rest of U.S., I would say, and into Japan. It's a very key reference for us in the industry, even though we're not allowed to mention it, as it has a big impact within the partner community and within the analyst community, where people do know about this, since things do spread every once in a while. We also signed a three-year SaaS deal with Telefonica in Deutschland. This was probably the biggest conversational AI RFP so this was a structured process that's going to happen this year Telefonica in Germany has roughly 50 million interactions or sessions per year so it's a very large entity and the leading telco operator very structured in their process very structured in how they go to market and they're going to be using our SaaS platform here as well, which is also, of course, a testament to the security work that we've done and the compliance work that we've done with the platform. We also signed a Lewis to the Power to Neo, sort of the Telefonica, of course, as well. And also the strategic important is Lewis to the Power to Neo. That's our product where we go together with Microsoft. We also signed us together with Microsoft to our teleco operator A1 Bulgaria. A1 Bulgaria is sort of the testing ground for A1, which in turn is the testing ground. A1 has what's called A1 Digital, which is a bit of a testing ground for America Movilis, the Carlos Slim operator, which is almost 400 million subscribers today. So an important milestone, but A1 Bulgaria in itself quite advanced and quite large as an operator as well. So also key strategic deal for us and with engagement from Microsoft throughout the deal. So very, very good for our model going forward. One of our partners, which also at this point we're not allowed to mention because they're building this out, they signed up and are deploying news to the Power to Neo for their own business, where they have support to their customers which is also, I believe, key that they're building it themselves and makes them an even more powerful partner force. I already spoke about the US tech company there. We also signed two renewal agreements, one with the US government department, which is a very interesting department as well. We'll see if we can actually build out a governmental business in the US on the back of this. And then Circle K, which we just recently announced as well has renewed and increased their engagement together with us. The Tinio platform now supports 86 official languages. That is by far the most covered languages in the market. It also is very key for Microsoft since this gives Microsoft the capability to position AI solutions in 69 more languages than they do by themselves. We were highlighted together with Microsoft by Gartner as a practical innovator for conversation AI in the beginning of the quarter. That's also quite key. This is how you can end up on short lists and RFPs and so forth. So very good marketing from a marketing perspective. And we also appointed a chief people officer, which is very key to us. We're going to start working on our culture initiatives, which is important for our continued recruitment in our continued growth Paloma was within the company already for a year but comes from a similar position in a different SAS company so congratulations and thank you Paloma we also successfully raised 120 million in a directed share issue this is to be able to execute now on the strategy now that we laid the foundation we reduced the cost quite a lot at the end of last year, made the foundation for the new strategy and then are starting to build out on top of that strategy with recruiting people but also increasing marketing spend. We've already so far in 2021 find three times more customers, new customers than we did in 2020 and we also 12% growth in recurring revenues on the rolling 12-month basis. Essentially, what we've done, we turned the business around, made it into a SaaS business. We can see now success with this. We've been focused mostly on the large customers during the first half, and now we're going to take that and move into expanding with marketing and adding onto the sales organization. So with that, I'm going to hand it over to Fredrik to deep dive a bit more into the numbers. Fredrik.

Thank you, Per. Let's then move into the next slide covering key financial highlights in the second quarter of 2021. Looking at the financial highlights in Q2, we can conclude that we, as Per said, experienced growth of 12% for the rolling 12 months adjusted recurring revenues. We also experienced growth of the quarterly usage revenues of 38%. and that will continue to keep a low-cost trajectory. And also in addition, which is still perhaps not too significant in our report and numbers, is also the fact that we have won a number of new and interesting clients that Per elaborated a bit on earlier. And as we have communicated in the quarterly reports for Q4 2020 and now onwards to Q2 2021, we continue to report adjusted SAFEs numbers to provide better guidance on our underlying contracts and revenues in order to align all ways of recognizing revenues

Excuse me, this is the operator. We have lost the connection of Frederick Tobrin. I will dial out and reconnect him. Ladies and gentlemen, please hold the line while we try and reconnect. Please continue.