Smart Eye (Stockholm:SEYE) Q2 2026 Earnings Call

0:00 Good day, and warm welcome to this earnings call for Smart Eye q two twenty twenty six hosted by Red Eye. We are here at the Smart Eye's headquarters in Gothenburg broadcasting live, and we will usually as usually, start with a company presentation followed by a q and a session, and I will remind you already now to start submitting your questions in the chat form, and I will ask it to management after the presentation. With us today, we have Smart Eye CEO, Martin Krantz, and CFO, Mats Benjamin Son, who will take us through the report. So without further ado, I will leave over to you guys. Welcome, Martin.

0:45 Thank you, Jacob. Alright. Let's get started. These are the highlights of Smart Eye's second quarter twenty twenty six. Automotive royalty is what is driving the growth and we are still fighting in a bit of a headwind with regards to behavioral research. And the FX effect that has been against us for over a year is starting to fade. This results in organic, net organic growth of 54%. We have 148,141,000,000 SEK in top line, which is the best quarter so far for Smart Eye.

1:36 EBITDA has improved a bit to 27,000,000 SEK. So we are on steady ground when it comes to EBITDA, at least. The automotive organic growth is 128%. It's up from last quarter. I know that the market was expecting even quicker organic growth, but I think in the long run, we will see that we are really transforming the company now from from having small license revenues to significant license revenues. And that's that's the main takeaway, I should say. The automotive licenses, they grow also just like last quarter with more than 200% year on year.

2:25 The car models continue to go into production. Last quarter, we had a 155. Now it's 175. And 20 of the 24 OEMs that we have under contract are in production now. So it's really going well. Behavioral research is backing 7%. I will talk a little bit more about that later. OpEx is minus 17,000,000 and the free cash flow is minus 24,000,000, which is a big improvement from last year. Let's start with automotive and license revenues.

3:12 We have since our first BMW models in 2018, We have signed contract with we call them design wins. One design win is one car model with three seventy nine car models.

3:28 Some of these car models, including the BMWs and a few others are out of production now ramped down. That's the 15. That's the number 15 at the bottom of this graph. 175 is the number that have reached production that has gone into production at one point in time, which means that the net effect here is 160 car models that are generating license revenue for us right now as we speak. That's a big jump from last quarter, additional 20 car models. And we are very happy about that. That is exactly according to plan. Not all of those 20 car models have ramped entirely yet. So we are still for several of the 160 car models, we're still in a ramp up phase.

4:18 And of course, we are heading with some speed, I should say, towards the 379 car models. Some of these are far out. Some, let's say, a few of those car models are even in the in the 2030s, but the vast majority of the three seventy nine car models are going into production in this decade, I should say between now and 2029. And that's of course, what's going to continue to drive growth for us. We are keeping the same guidance as we had last quarter. We are now reaching 175 car models and we expect to be above 200 in at the end of the year, but below 250.

5:14 That's of of course, we have we have estimates from our customers telling us when the car different car models are going into production. But historically, several of those estimates were delayed for some reason or another. So that's why we're keeping that range rather wide.

5:37 Seen on the global market, most of the car OEMs and the car models that went into production this quarter was in Europe. So Europe, the European legislation, general safety regulations, that's what's driving the growth more than anything else. The other regions are also growing. So we do sell more in Asia also both for the internal Asian market and for export vehicles exported to Europe. But of course, nothing can compare to the really strong regulation driven growth in Europe in Q2. We have made estimations of the order values, all these three seventy nine car models. I mean, what went into production and what ramped up during Q2 are car models that were signed and contracted between 2020 and 2023.

6:39 So that's that's the kind of lead time we're talking about. Now they go into production. Now they start generating income for many years to come. If you do the same calculation over all the 379 car models and subtracted BMWs and the few others that are out of production, our estimation is 7,600,000,000. We are not changing that number this quarter or or the calculation basis calculation this quarter. The FX effects are so small since one quarter ago. So we just keep it as it is. Good morning. Yeah. Let's continue with the financial summary for q q two twenty twenty six.

7:31 Net sales up to SEK 141,000,000 and that is a growth of 23% and organic 54%. And then we adjust for the acquisition of Saietyk that has been done and the FX effect in the quarter.

7:51 Rolling 12 net sales amounting to almost SEK $490,000,000, so it's organic growth of 43. So really good to see that net sales is coming closer to SEK 500,000,000 in rolling 12. We have a good gross profit improving with 44,000,000 and we keep our gross margin on 90%. Automotive, you have heard Martin talk about it, the organic growth 128% and this is of course driven by the royalty revenue. Then we have also adjust for 1,600,000, mainly referring to the FX effects.

8:37 But the project revenues, the NRE revenue is also on a high level. We have a good progress in the company and in our OEM programs, as we have a slightly increase there as well. The AIS portfolio also delivers more volumes and also has a good growth in the quarter. Behavioral research is down 6%, and also when we do the adjustment for the organic growth, it's negative 7% in the quarter. But we have SaiTik as a new business coming in and improving the net sales with 2,500,000 in the quarter.

9:23 And also if we adjust the FX effect for iMotion, referring to the sales of multimodal software platform and the media analytic tool used for ad testing, they actually report a really good growth, organic growth in the quarter, 7%. So Applied AI revenue, that is declined in the quarter. Looking into the OpEx development, we have increased OpEx compared to Q2 last year with 24,000,000. And this is driven by the acquisition of SEYETIQ and also that we have higher personnel expenses.

10:06 We have the salary review in Q2 that's affecting the OpEx. And we also have slightly more resources in the company. And then we have higher amortization the quarter. And this is referring to investments in IT, referring to financial leasing, and also that we have increased amortisation, referring to our acquisition, referring to surplus value, like goodwill, etcetera. If we compare OpEx development between Q1 and Q2, we're also increasing with almost 16,000,000. And this is driven by the amortization and acquisition and the salary review.

10:55 And then we also have some one time items in Q2. The effect on our profitability levels, EBITDA improving to with 26,000,000, so we are now up on 27. And here, we can see the onetime items affecting the EBITDA with SEK 3,600,000.

11:19 We also have a positive effect referring to FX 2.3. But if we take out the one time items effect here, the adjusted EBITDA is up to 31,000,000. So we're still having good development on the EBITDA development compared to Q1. We have more amortization, but we still have a good improvement on EBIT level with SEK 20,000,000. And then, of course, we have more financing expenses, and this is referring to the issuing of the bond in December 2025. And also that we have some more expenses referring to the financial leasing investments.

12:08 So the earnings before tax improved NOK 14,000,000. Checking in on the balance sheet, we can see that the trade receivables increasing in the quarter with NOK 21,000,000. So it's now up to 24,000,000. And here I would like to say that referring to the royalty revenue and the payments, the royalty revenue that we reported in Q1 had not fully been paid in Q2. So these have a consequence, an effect on the cash flow. So we can say that around one third of the royalty revenue for Q1 it had been paid early in Q3.

12:56 The cash ending balance amounting to SEK 180,000,000.

13:02 The free cash flow still improving, SEK 14,000,000 if you compare to the same quarter last year and also improving compared to Q1. The free cash flow now amounting to 24,000,000. Investment, we still are around we have reported 33,000,000 in Q2 and this is in line with last year and last quarter. Here I would like to point out that we have done a reclassification of one item of 10,000,000 between the non cash items and the other current liabilities, and this referring to the cash flow January to June.

13:49 Finally, let's summarize the Q2 development. So we have reported stronger royalty revenue that drives our growth. This is supported by new business from SaiTech acquisition and also good organic growth from iMotion. So we have a very good profitability and cash flow development all in all.

14:15 What can we say about the autumn?

14:18 We see that we'll continue to ramp up royalty revenue in Q3 and in Q4. We see that we have more design wins that will enter in production and those design wins that have entered for production in Q2 will report we expect to have higher volumes in Q3 and Q4. We have a year end effect for the Behavioural Research that we expect to happen in Q4. We have seen it before previous years that Behavioural Research report higher net sales in Q4. So we expect that to happen in this year as well. OpEx will decrease in Q3, referring to the seasonal vacation debt effect, and that will also improve EBITDA in Q3.

15:11 Referring to the cash flow, we have tax items. That is referring to the incentive programme 2023 that has been issued during Q2. These tax items will be paid in Q3, so that will have a negative effect. And then referring to the payment schedules for our NRE programs, that will also have an effect, a small positive contribution in Q3 and a high positive contribution in Q4. So all in all, we see that Q4 is the most best option to see that we will become cash flow positive.

15:56 That was all from us. Thank you.

16:05 So I'll start with a couple of questions of my own, and then we'll move on to the audience because we have a lot of activity today. And my first question is, like, you're obviously growing year over year. Questions we're getting made the market have expected a a little bit more growth even given that, like, now all the cars in in Europe should be close to equipped with DMS. So, like, is this quarter according to your plan and or, like, are we missing anything? Yeah. This

16:44 quarter, let's talk about automotive first. For sure. When it comes to automotive, when it comes to royalties, license revenues, it is very much according to our plan. So we see we are very close to our own, let's say, estimates going into this quarter. So and the estimate is also which is kind of, you know, good. It's it's close to the estimate that our customers have given to us what they will produce. So we're we're finally back in a in a in a stage where

17:19 the the production predictions or forecasts from our customers mean something they are not constantly delayed. So that's good and I agree the market was expecting more growth. There were several data points coming in from the market showing a strong structural growth pattern. So I think we delivered 128% organic growth for automotive. I think the market was expecting 150% or more. Yep. And like you touched upon it in the presentation, but you have like I think 160 design wins that are in production, like producing right now. How far from like peak production would you say that this cohort of cars are like are we at?

18:08 I I would say, let's divide it in the Europe, which is the biggest part of it Mhmm. And non Europe, which is a smaller proportion of it. And when it comes to Europe, I should say we are right now at 80% or something like that of full production penetration capacity in Europe.

18:34 The European market will continue to grow q two to q three, but it's sort of you're at the end of an s curve, so I think there will be a 100% take rate in Europe in q three, so the growth between q three and q four will be negligent, but still, like in percentage measure, a good growth from 80 to 100% now. Yeah. Okay. So like Europe wise, from q two to q three, we should expect the take rate to increase

19:05 from like 80 something ish to 100. Yeah. Yeah. Yeah. And rest of world, you expect to grow that as well? Yeah. Rest of world is also growing. And also in the rest of world, we have we have many cars that are pending to go into production shortly. We have production platforms where where additional cars are added and things like this. So so that's more of a structural growth, not as quickly as we have seen in Europe during, let's say, q four twenty five to q two twenty six. Not then kind of steep growth, but more like Yep. A steady going growth. And I mean, you kept your guidance on the 200 to two fifty car models that will reach production by latest end of twenty twenty six. Like those that you expect to reach production this year, are those mainly rest of world cars or are there still a mix of European cars in there or You have a lot of European cars that go both for the European market and export market, and you have a lot of, let's say, especially Korean and Japanese car that are manufactured in other countries, but are exported to Europe.

20:19 So but also our Japanese customers and Korean customers do sell do do sell DMS on other markets, not only Europe. Yep. And I mean, you still have like something like 200 design wins left to enter production.

20:39 So I think you mentioned it also in the present day, but just to be a bit more clear, like, what is the time frame we should expect like these to enter production? Is it three years, five, seven years? Yeah. Like, we're we're guiding for at least 25 of them this year, probably more Mhmm. Before the end of year. And then we we continue to have to we continue to go on to production at a quite high pace, maybe accelerating 20 say second half or '27, beginning of twenty eight, there will be an acceleration of the of the SOPs, total production. Okay. But but most of those 200 cars will go into production before the end of this decade. Yeah. But during this period, we also expect to add new contract, add new design wins, multiple procurements going on, many negotiations are happening as we speak. Interesting.

21:38 And another, like, question. I mean, how DMS is becoming mandatory across Europe, of course, and it is right now as we're standing here. More And in Japan. And in Japan, of course, 2031, I believe. Yeah. And therefore, more and more people obviously start to use DMS, and therefore also have opinions about it. So I thought I was gonna ask like, when you read around online, it seems like many people think the systems are like annoying, that they don't think they can save lives and so on. So what is your view on the skepticism towards DMS from the customers and like, is there actual data supporting that it can save lives? Okay. Two questions basically. Yes, it can save lives definitely.

22:27 Distraction and drowsiness are two very well documented causes of accidents, and accidents in turn can be lethal or non lethal. So so it's it's very clear, let's say, scientific evidence that that this legislation has a sound scientific basis for for it to be there. So but if you go to the customer experience, I mean, if you get a warning that says, you are drowsy, you should you should take a break, but you're not feeling drowsy because the DMS system was not accurate enough to detect your drowsiness or high accuracy, and the same goes for distraction, You will be very irritated. And a lot of systems on the Chinese market, the MS system, that you can turn them off. I've even seen examples where you can hide the camera lens with little sliding what do say? Yeah. I understand. Yeah. Some kind of protection. Yeah. Yeah. So so for me, this is like this is, you know, early adopter problems.

23:38 The technology is still quite young. In many cases, it's immature. A strong DMS system will warn when it's supposed to warn and it will not warn when there is nothing to warn about. And if you look at the Euro NCAP scores of Volvo, the new Volvo cars and and the Polestar cars, they have very high scoring for for the DMS, and we are extremely proud of being part of that solution. Yep. And moving on for some financial questions I have for you, Mats. It would be good once again to understand, like, how your increased revenue and earnings will translate into cash flow from this ramp up. So you gave a pretty good outlook here in the presentation, but like when is it that you get paid from automotive customers or OEMs or tier ones for for this quarter's revenue? When will it turn into cash flow? We can see now the latest quarter is that the license revenue that we have received report on in late July, early August, we invoice them and usually they are paid in the quarter after in Q3.

24:52 But as I mentioned, we can see that up to one third of the license revenue for Q1 have been pushed into Q3. And we saw that. I mentioned that was the last earnings call referring to Q4. So that have an impact. I haven't seen that before, so that is new for us. And then also talking about NRE revenue because we have payment schedules there. So some quarters we are invoiced heavily and we have the payment within one or two months, and some quarters they are a little bit lower contribution. I also got this question from an investor, like how's the work going on with transitioning to IFRS?

25:40 You stated last time that it will be made in Q3. Do you think you will make the deadline? We should make the deadline, yes. We are having a good progress in that project. So we have gone through all the IFRS policies, and we know how to manage it. So we're now planning for how we change the coming interim report for q three. Okay. Great. And a question about AIS. Like, how is that business developing, and how is it affected by the GSR legislation if it is? And Yeah. Can you mention anything maybe about procurements or aftermarket deals or anything? We we have previously communicated that we have a lot of, let's say, bus OEMs and small truck OEMs that are that we have received nominations and and we will deliver the AIS system to them.

26:42 But we have also seen that they have ordered as little as is possible in q one and q two. But we see now without guiding too much on the q three's result, but we see now that in q three, the AIS deliveries are increasing rapidly to this type of customer. So that's positive. And I think they waited to the last moment to equip their trucks and buses with the system mandatory for the GSR requirement. Yep. Then we have a few stable customers that are according they they are very predictive and long term contracts. One big a fairly big heavy truck manufacturer and one sports car manufacturer.

27:28 And that's just rolling along, I should say, that it's it's it's just the contract was signed several years ago, and now we're just executing on the contracts. Yeah. And what about aftermarket? Any in any, like, negotiations or procurements regarding that? I mean, you had a nice order from Optics Yeah. Yeah. Four quarters ago. And we we continue to work closely with Optics. As you say, there are other customers as well for the aftermarket. They are not necessarily ordering or getting deliveries every quarter. It's more like something which will happen when it happens. Yeah. And just a few more from me before I will jump into the questions online here, but if we talk about procurements and activity for automotive regarding intoxication and other, like, interior sensing features. How is the activity there?

28:26 That's where the procurements are. The procurements are ongoing. I mean, let let's talk about pure DMS, minimum requirement to meet the GSR European requirement. Those deals were made between 2020 and 2023. Now in '26, we're mostly talking to customers about a full interior sensing software stack, both cabin monitoring and driving monitoring with different types of camera setups, camera configurations. And they are much more feature rich. They are more complex. It's a higher value per car that we can deliver in these procurements. And that's I say that's maybe the most interesting story of all is who will be successful and who will not be successful in the, let's say, ongoing procurement season. Interesting.

29:24 I will move on to questions from investors here. We have a lot, so if you can try to answer as briefly as you can, so we can manage many of them. But one investor is wondering, you're showing explosive growth momentum in automotive, yet EBITDA and EBIT declined quarter over quarter. How do you explain that and when do you see EBIT positivity? The acquisition, I think those cost items that I mentioned earlier, it's about the acquisition, few more resources, one time items, investments in IT, etcetera. That is and the high amortization coming with that. But at the same time, now when we're looking into the transition to IFRS, we will change the way of report EBIT level.

30:27 But we will come back on that next. A follow-up from the same investor is also about cash flow positivity, and I think you mentioned softly not anything firm, but q four is a potential quarter. Is that how we should interpret it? Yes. Because we talked I mentioned this long term incentive program, share program that we have for the employees. That was issued in mid q two. There is tax items that we need to pay in queue in July to be more exact. Yeah. So that is one one extra additional payment that will have a consequence in Q3.

31:16 And then also mention the NRE revenues referring to our ongoing programs, the schedules there. So they are not contributing so much in Q3. Could you say like this, a little bit of headwind in the cash flow in Q3 and a little bit of wind Tailwind. Tailwind in Q4. That was a good summary. Great. Moving on. You added only twenty twenty car models into production in q two. How come the number is this low considering the new EU requirements? There should be a lot of car models in The EU. So the the the quest the person questioning wants more car models in in in queue.

32:03 Yeah. It's two. Yeah. This was very close to the our own internal projections about how many more cars would go into production, and it was very close to our customers' forecasts about how many cars would go into production. Additional cars will go in production in q three or has already actually gone into production in q three and in q four. Moving on here, there are a lot of questions that are about the same topic, so I will try to skim through it here. Can you give an overall estimation on automotive sales world worldwide between the different geographies? So, like, Europe, US, or Asia in percentages, like, regions are the largest in terms of automotive sales? We we used to have a slide where those those percentages written down, but we didn't update that slide for this report. So I don't have the exact numbers, but I would say now since the ramp up was so strong in q two in Europe, so maybe Europe is 60% of the global market or or maybe 50, depending exactly what what's going on in China. Mhmm. But but something like this. Yeah. Will you keep the

33:33 gross margin over 90% also in 2027? Over 90? I don't know if it will be over 90, but I can say it's really around 90, I would like to say. Good enough answer, I think. Has the average sales price changed as GSR related cars are increased? Like, are manufacturing you're choosing more basic features just to meet the requirements? A lot of the cars that went into production in q that's a great question and and so thanks for that question. In q two now, a lot of the cars are execution of contracts with written between 2020 and 2023 where bare minimum for GSR was procured.

34:21 The ASP is on the lower side in our range. We have everything from, let's say, 3 ish up to €10 per car depending on what kind of system. Actually, even more than 10 for some cars where it's both cabin monitoring and driver monitoring. But so so some of these GSR cars, let's say, low cost cars, mass market cars that just have GSR for for legal purposes, not for, let's say, driver experience purposes. They they are on the low side. And if you look in the future, what is being procured, what is what we have up our sleeves, let's say, what's what's coming, it's a lot of much more feature rich cars. You have seat belt detection, posture detection, face identification, iris identification, intoxication, and these kind of things that add value to their offering.

35:21 Okay. Interesting. And we have received a couple of questions from investors or questionnaires that are wondering, like, comparing smart ITC machines, and there's a lot of different questions here. But I think, like, one is about if you can disclose, like, the number of cars on road, but we know that you don't do that, so I won't ask that. But I think you can overall summarize it as, like, is is do you see that seeing machines are overtaking you or, like, grabbing grabbing market share from you or eating your lunch, so to say? Seeing machines is eating a lunch. The the yep. Great question. I I should start by saying that we don't really talk or comment individual competitors.

36:12 I mean, it's a it's a it's a fast growing, very interesting market where all the competitors we respect all our competitors and so on and so forth. Now having said that, I think it's important to to not live in the past. And and what was going on between, let's say, 2015 to 2020, this was purely it was purely a premium car thing to have DMS. It was BMW, Volvo, Audi, these kind of cars, Lexus. They they they Cadillac. They had DMS and not really the mass market. What happened actually before the GSR regulation came in the end of twenty nineteen was that the mass market car OEM started to procure it. So 2019 was the year when those kind of procurements started and twenty twenty to twenty twenty three was the year when the nominations happened, a little bit delayed due to COVID and so on. But still, and that's what we see now. The production numbers that we see now is the result of the '20, let's say, nineteen to twenty twenty three wave of procurements.

37:27 And what's important to say is that that happened in the past history and we see the rollout now. So I would not trade our three seventy nine design wins that is unmatched with 24 OEM, which is also unmatched. I will not trade it for anything that any competitor sits on, whether it's old contracts or or anything like this. We think that we are never better than our latest game that we played, and the game that we play is a game of procurements that we need to win. I think that's a good colorful answer enough.

38:12 A quick one from the the same questionnaire here is, is the automotive design win pipeline value entirely licensing revenue or does it include NRE revenue as well? It includes NRE, but that's what you say, Matt? 5% maybe? Not not even or maybe. Say, I haven't calculated on that specific actually. No. Any issue. That's good. And also, I think this is an interesting question. Can Martin give his comments on the competitive threat of mobilized DMS? Again, don't wanna talk about don't wanna talk about specific competitors. So they are all there and we meet them every day in in in the markets, let's say.

39:00 So they are a company who are the market leaders in ADAS and their claim for DMS is that it's very well integrated into their ADAS. But of course, it's there are more than one way to integrate the DMS system in an ADAS system. So I leave it by that. Mhmm. Great. And a question for you, Matt, is are you planning a list change? And if so, how's that going? The board haven't decided on any list change. The only decision is for the bond that we issued in December. That will happen in q four. That is a list change for for the bond and not for the share price. But it's not ruled out either. Right? No. It's open. Yeah. Good.

39:52 We'll continue here for a couple of more minutes. There's a lot of questions that we have also already covered, so pardon me for trying to read through here at the same time. Like yeah. Okay. Here's a question regarding maybe Chinese competition here. Like, how much is is your like, how much do you think you are impacted by Chinese competitors that are, like, either winning procurements in Europe and other western markets or exporting Chinese cars to the European markets?

40:44 The Chinese market is very large and it's very important both for, let's say, ICE cars, electrical cars, and also it's also important for safety systems and DMS and many other automotive tech stuff. So I say we are very small. Our market share in China is very, very small. We are mostly there together with international OEMs who sell not very big volumes of cars in China with Smart Eye DMS in it. We are exploring opportunities in China, both for Chinese export car that are going to be exported to Europe and otherwise, and also cars that will be sold, manufactured in China and sold in China. But it's a it's a it's a, let's say, white white, almost a white spot on the map for us. I mean, we're not there yet that we have a clear China strategy that we are executing on.

41:52 Okay. And another question. How many models do you think will go out of production during 2026 or 2027, if you can say? I don't think we really calculated it, but it's more like it's more like we're in a ramp up phase than in a ramp down phase for most of our OEMs. We had so many OEMs that were delayed during COVID and during the semiconductor crisis, shortage crisis. So it's more of a ramp up, I should say. Not many go out of production that I know of. No. I'm thinking the same here. Maybe after 2027 or later, I think maybe you come back on reporting number on that. And just maybe a clarification.

42:45 Someone is wondering here, did Mats mention that roughly one third of the royalty revenue was delayed from Q1 and was instead received in q three. I mean, we were talking about the cash flow there. Right? Yeah. That's what's right. That's correct. So cash flow that is driving from the q one revenue was received early q three because of That's correct. Slight delays there. Okay. Yeah. And some investors are also wondering about should you interpret it as a sign of a start of production slowdown? Because in q one, you put, I think it was like 30 car models into production, and now it was 20. So people are interpreting as, like, a slowdown when it should be ramping up in line with the GSR, but maybe if you wanna comment.

43:36 Should I start to comment? For some customers, anyway, we have precise information about car models and so on. And for some, we just don't have it. So it's on very high level. So therefore, we need to figure out which car models that we think have entered the production in Europe or elsewhere. So therefore, there is not the exact number we can say. So therefore, it's really difficult to see, to calculate on that. I would say of these 30 cars in Q1 twenty and Q2, most of them are European, intended for the European market, whether they are made in Europe or made in Asia or in some cases, actually, US, They're intended for European market.

44:36 Yep. And also just a question on behavioral research. We have touched a lot upon automotive, but you have a second business area as well, actually. It showed a slight decline in the quarter. Can you update us on the market activity here? The decline is year on year. So 7% is the organic decline year on year. If you look quarter by quarter, it's a little bit different story. It's a small, small, less than 1% increase, actually, if you compare it to Q1. So know that following the traditional pattern that q one q four should be strong. But we have also good hopes that q three can be better than q two.

45:21 So that maybe q one was actually the bottom. But it's too early to, you know, hail Yeah. You know, hail victory here. But because the the market is is has been not strong, I should say, especially for hardware. Hardware was hardware sales was down a lot. Luckily, it was compensated for by by good software sales. We are moving through the questions here. I think we have covered almost all of it. I just have one final question as that is how is SEYEK developing regards to like the deal with the police authority? Have you started getting paid for that deal or how is the potential deal pipeline forward?

46:08 Yeah, absolutely. We are getting paid from, let's say, the day we announced the deal almost, maybe just a few days difference. But yes, we have a big European police authority that we work closely with deploying this new and very interesting technology. And this is super interesting. It's not a big revenue stream yet, but it has a good potential. I mean, if it works with one police authority in Europe, it will work with many. So we see a strong, strong potential for it. Good. I think I hope that I have covered, like, all the subjects here. I understand we haven't been able to answer each and every individual question, but overall, I think we've covered it well. So I will end the q and a session here, and maybe do you wanna take some few words and summarize your thoughts?

47:06 Yeah. I I should say, of course, I was very disappointed when the stock market opened today. The stock is trading down. The expectations were higher from market was higher than what we delivered. We will continue to do what we think is the important stuff. We will deliver our production program so that the cars reach production so that they can start generate license revenue. We will keep costs under control. We will have tight cost control. We have had it. We will continue to have it. And we will win new business. And hopefully, behavioral research has bottomed out and will grow from here.

47:54 Perfect. Thank you both, gentlemen, for the conference call today, and thank you everyone for listening in. See you again next quarter. Thank you.