My name is Thomas Bernhardsgrütter. I'm the Senior Director of Investor Relations, and I'm very happy to welcome this big group here in Stäfa at our Investor Day, and also wanna welcome all the people joining on the live webcast. Before we start, I just wanted to mention a few housekeeping items. First of all, for those of you who need Wi-Fi, you see some posters hanging on the wall with both the Wi-Fi as well as the Wi-Fi password. Just make sure you get the spelling correctly. The people are working normally today here in this building, so if you need to find a restroom, just go out this door, take a right, and follow the signs. There is no smoking in this building. Fortunately, we have very nice weather, so if you need to have a smoke, just go outside and take the stairs up on the terrace and enjoy the sunshine up on the terrace. I also would like to ask you not to take any pictures during the day or during the factory tour. And finally, I hope you will be able to experience the new products that we announced a few weeks ago. We will have a marketplace in the back of the room during the lunch break, as well as after the event, for you to talk to the experts, see the products live, touch them, and ask questions about the products. At the same time, we will also have a live sound demo in the room just outside as well. We will guide you to that room. We will have to do it in small groups of about 10 to 12 people, but we will try to make sure that you all get to experience also the benefits of the new technology, either during the lunch break or after the event finishes at four. In terms of the Q&A session, there will be two Q&A sessions today. The first one will be after the morning block, so before lunch. This one will be for the people in the room, and then there will be a second Q&A session at a quarter to four, where we will also give the opportunity for people that are joining virtually to ask questions via the phone. The details for that you find on our webpage. There you see the dial-in. Dial in ten minutes before if you wanna ask a question in the room in the second Q&A session. And with this, it's my pleasure to pass the word on to Birgit Conix, CFO of Sonova. Oh! Hello. Welcome, everyone here in Stäfa and also online, to our investor and... Oh, you don't have the presentation yet. Oh, that is me. Thank you. Welcome to our Investor and Analyst Day. What I will do is I will walk you through the agenda, and what we will first start with is to give you an update on the recent market developments in the hearing aid market. Then next, I'll hand over to our CEO, Arnd Kaldowski, who will share the group strategy and also outlook with you. Then we'll dive into innovation, which is at the core of our strategy. Rob Woolley, our Global Vice President, Hearing Instruments, will demonstrate how for the past decades, and actually, time and time again, we deliver breakthrough technology. We do that again this time with our latest platform, and that is what we will show to you during that presentation. We will move on to Arnd again, who will talk about how we successfully combined our internal core competencies with some external capabilities and skills. After that, we will look at how this all comes together. All these events for the past five years lead to our newest platform with Infinio and Infinio Sphere, and Oliver Frank, our VP Phonak Marketing, will give you an overview. He will talk about the core products and will also give you a flavor of the recent launch event in Las Vegas. So then after the first Q&A, as Thomas already said, we'll go for lunch, and then you have the opportunity to experience for yourself what real time AI based sound processing means. And then there is a product demo for you available, and as already said by Thomas, you'll also have the experts in the room, in the back of the room. And then after lunch, you will hear from two of our newest management board members, Oliver Lux and Lilika Beck, and they will talk about audiological care and also about the Sonova X business system, which delivers a lot of benefits. And they will do this together with Arnd and also with Ludger Althoff, our head of operations. And then after that, we go second Q&A, and then the factory tour, as Thomas already discussed. So let me first, walk you through a recap of why Sonova is an attractive investment, because this is a broad-based audience. So first of all, we operate in an attractive market, so with some very strong growth fundamentals. So firstly, the aging population, which is the base of our consumers, and then the significant penetration potential that we still see in developed and also developing markets, so in both, and then in that market, we have a leading market position because of our broadest and most advanced product offering, and also because of the strong distribution network that we have in both B2B and B2C, where we expanded significantly over the recent years, and then we have strong financials. We have a strong balance sheet, we have strong cash generation, and that allows us to invest in both organic and also M&A growth. And then finally, and I'm very proud of the progress and also the focus we have on sustainability. So we are the top performers, not only in our industry, but also outside of our industry, as reported by major rating agencies and also publications. And Arnd will talk about that further during his presentation. Then a bit about the market update. So what I will be showing here is each time is the monthly unit volume per market, and we only show data that are based on tracked markets, where we have official statistics, basically. And I'll first start with the U.S. commercial market. You see here that for the first four months of our financial year, compared to last year, the market is growing at mid-single digits. If you compare that to the last fiscal year, there was low teens, and that is what we expected, that there was somewhat of a slowdown to mid-single digit because of the strong comparative base. But then if you look, interestingly, on the five-year CAGR, so the long term, you see that we see that the market, US market, is right in the middle of the 4%-6%. So long term is really remains fundamentally strong and actually is a testimony to the strong and attractive market overall that we are in as a company. Then the U.S. government services, so that is primarily the VA, and here you see a slower growth also on the longer term. And just recently, this is due to capacity constraints that are effective in the U.S. government services market. And then when we look at Canada, so the past four months, we see a double-digit growth, and that is a very strong growth. And when you look at the five-year CAGR, again, right in the middle of the 4-6% that we would expect on the longer term. If you then look at the major European markets, and showing these three here. First, Germany, mid-single digits for the first four months. If you compare that, for instance, to the last half year of the second half year of the past fiscal year, that was also mid-single digits, so that trend is continuing. Then if you look at France and the UK, there we see actually a lag, and you see that the growth is either flat or slightly in decline. Now, what I'm not showing on this slide is NHS in the UK, and there we see a growth of over 30%. But here we need to be mindful when we think of the ASP in this channel is much lower versus other channels. So in terms of value, this is not the same effect, and it's of course not in line with what we see in volume. Then, if I summarize, because we don't have monthly data for all of our tracked markets, so if I summarize the first quarter, then we see in our tracked markets a market growth of +6%. But if we back out the NHS, which I just alluded to with this high unit of volume growth, then we are at +3% for the first quarter for our tracked markets, which is slower than what we would have expected. But on the other hand, when we think of the full year, we still believe that the market will be, for our tracked markets, at 4% to 6%. So with that, I would like to hand over to our CEO, Arnd Kaldowski. Thank you, Birgit. Good morning, everyone, and, I would be remiss if I wouldn't say welcome to Stäfa and outside. Normally, I have the first section, so now you had three welcomes. We're excited to having you here to share what we think is exciting. And then obviously you want to get more facts and data, and we'll share as much as we can. So, we're going to build a little bit of a momentum towards Oliver's presentation, because then you get to the nuts and bolts on the product as much as we can share on data, and then later on, you have a chance to listen in. But I would say if you look at the front page of the presentation, and you see a hearing aid, I would say I was about 12-13 stories high on the Sphere, which is 15-18 or so. At least you could say we're brave enough to put a hearing aid in the middle of Las Vegas at that scale to drive some awareness, right? So that's at least a good guy. But on the other hand, I think it is credit to our belief on the impact of the Infinio, the Sphere Infinio, but also the Sphere technology over time, which we wanted to put a little bit of an exclamation mark behind. So we'll dive deeper on the exciting breakthrough. are two other topics we wanted to cover in the afternoon, and they are better explained when we go through the Sonova strategy. No surprise, no change in bigger picture. We continue to drive down the same path because it works for us, and I think it's a good strategy for the market position we have and how we play in the market. Clearly leading innovation, a big highlight for us this year on the strategy execution. The work was in the last six years, as you will see, but now we get to the point where we can share with you, but obviously, equally importantly, with the customers. The second one is expanding consumer access through more access from a retail perspective, but also the digitization. Oliver Lux will go a little deeper on the example of Germany, which he led before we were able to promote him to become a management board member, and now responsible for all of audiological care. We will not go deeper, but still important and still activities going on under Rob's leadership in Australia, because the third one is about B2B hearing instrument and cochlear implants to go to market, broadening our access, expanding the value we add. And then the fourth one is more of a long-term play, but I think important in the years five to ten, probably from now, if you, if you think in big picture, it's the high growth developing markets. And then we have the enablers, one of them being continuous process improvement, and we wanted to take a half an hour now to go a little deeper for you. We always reference that we wanna give you a chance, at least for the ones who are interested, to see a little bit more what do we mean by that. Now, I'll come to the full year outlook, but let me start off with the growth ambition hasn't changed longer term. I think, as you could see, it was beautiful to see the five-year CAGR. 4%-6%, good number, right? Now, we can debate value a little bit, 1% up, 1% down, but in general, this is 5%. Hopefully, become 6% when we grow up and when we drive innovation and penetration. But it is a very steady, despite the COVID in between and the inflationary environment. So for us, that means profitable growth starts with 6%-9%, and an EBITDA growth of 7%-11% is what is our mid-term targets here, and they remain in place. Right? Now, moving on to the growth drivers. There's one more than I had on strategy. Why? When we think about leading innovation, we think about two pillars. The one is, how do we advance audiological performance? Because that's the core functionality people are seeking when they buy a hearing aid. Right? And we had good launches over the last years. You remember Marvel, Paradise, Lumity. We can debate Lumity. I'll get back to that. But when we showed this chart first time, I think it was a year ago, may have been two, you go on the advanced audiological performance, pioneering technology to deliver best-in-class audiological performance. We will do our utmost best to convince the customer with the great technology we have in our hands, and today, you. And you can see we were working on those core hearing performance, processing power in the form of chips, which is the underlying necessity from a technology perspective, but also algorithms. And we already indicated that to the traditional algorithms, we need to add other ones. Expanding consumer value, not so much the focus this year in terms of new things. We have some technology-enabled medical services in the audiological care. We have an early entry hearing device, need to see how we build beyond the hearing performance. Not critical for the numbers this year, and probably not next year, given the growth we have out of the core, but I think eventually we need to find ways to create more value. Broaden consumer access, already voiced that over. Oliver will go deeper, deliver commercial excellence in terms of value add, feet on the street, commercial execution in the B2B environment, and then the high growth markets. Now, we will not share updates on numbers. This is a capital markets day, and we are convinced that our guidance is a good number for the year, and we stand behind that. So that was what we shared also this morning. So in that, we got no change to the big picture for the year. You can see the 6-9 and the 7-11. But you heard Birgit already saying Q1 in the market was a little lower than we thought. Probably, you heard also from others. I think that is factually correct. It doesn't bother us at this point of time towards our guidance. One, which is going to help us, particularly in the second half year, with the Infinio, the Infinio Sphere. But I also heard that people reacted when we announced the products. Wow, it's quite broad as a product offering, and I think Oliver will guide us through. Right. Now, how do you put that in perspective with what everybody will have in mind when they're sitting on their spreadsheet? What's the first half, second half year dynamic? Well, that's a complex one. And you know, we don't give half year guidances, therefore, there's no half year guidance, right? But we will share, and I can share up front, and we'll go deeper. A very positive initial market response to the product Infinio, but also Sphere Infinio, and some expectation on the ITE rechargeable. But there will be not a large revenue contribution because, yes, we launched in the US. At the beginning, people put it on some ears to see what the response is, so the curve is always back-loaded, and the European markets only come in in September, and then again, they are going to put it on some ears before they buy in larger bulk and switch over, right? On the other hand, you have all costs. They are the known costs of a launch, right? You have launch costs, you have ASP drop, because people start to recognize Lumity was great, but still old, and then you have the manufacturing ramp-up. Now, all those three, while we will not give numbers, and I'm sure people will ask to try to pinpoint us down, but can't give numbers today, but what I can say, it is a bigger impact on the launch cost. If you assume Infinio Sphere was the leading event, guess what? All others will be also larger because we wanna spread the positive news, right? By the way, in the Sphere, we had one thousand customers live. Normally, we have in the largest event in U.S., two hundred, so big impact. We have seen quite significant ASP pressure, not just the launch situation, but quite competitive market right now, as you could see from the voiceover of our competitors. And on the manufacturing ramp-ups, also offer proportional because of the breadth of the product offering, which we are launching at the same time. So clearly, first half year is fine with regard where we wanna go in the full year, because we do believe the lift is there, but it is quite skewed at the end. Now, one caveat here when you think in terms of currency, unfortunately, the Swiss franc is not our friend if it comes to the P&L. When we gave you numbers at the end of the fiscal year, we said at that rate, there was a slight positive in the expectation. This has turned around in the last couple of months. You see the numbers here. In Swiss franc, if the current rates stay in place, we'll have 1%-2% headwind in Swiss franc on the revenue side and 3%-4% on the EBITDA. Now, we have seen shifts in the last two to three months, so I'm not here to predict anything for the future. I trust you will not, too, right? But at the end of today, it's something we have to unfortunately live with. Before I hand over to Rob, just a quick note on the ESG. There's no change on the slide relative to what I shared a couple of months ago, but we wanted to put it in because I know it's increasingly relevant for you. It's increasingly relevant for us, even outside of the investor community, because we really wanna have the best brain pool, wanna have the people being happy and excited with us, but we also wanna help to do what we have to do with regard to planet Earth. So our focus is greenhouse gas emission, as you would expect. We have science-based targets, packaging weight on the social side, big, important for us, employee engagement, not just from the productivity contribution, but also the voluntary attrition, as you will see later on the audiological care, but then also from a D&I perspective. I think all areas where we're making good progress. Governance, big focus on the ESG reporting, being ready for in time, being auditable there, but also the product reliability. Now, we can claim all these numbers, so it's interesting to look on what the ESG rating agencies do. When you read the fine print in every one of them, we are consistently in the best 10% of our peer group. In most of the cases, we're more in the 2%, 3%, so doing a good job there. With that, that was just a recap strategy. No change, no change to guidance and outlook, so that should be pretty smooth as expected as a capital markets day. We're moving into why I think most of you are super interested today, which is innovation, breakthrough, and what is in it for the customer. With that, I wanna ask Rob Woolley, who leads the hearing instruments business globally. Thanks, Arnd. Good morning, everyone. I'm excited today to talk to you about two things. Number one, market leadership, but primarily number two, how we're trying to push the boundaries of innovation. So let me start first with market leadership. It's very straightforward how we define it. You saw Birgit talk about what happens from a unit perspective, but we measure market leadership based on units and value, and that's really important to our business model. We also measure that based on growth. And last but not least, we tie that to something that is very important to us, and that is our vision and our purpose to enable as many people as possible to enjoy the delight of hearing. So it's easy to measure. It's more difficult to do. So let me walk you through what we try and do in our business model to define what market leadership is. And there are four elements, and it's important we're a B2 B, and we put parentheses to C, because we design our products ultimately around an end consumer who is trying to enjoy the delight of hearing. And so it's really important that we differentiate because we also have customers that are the providers of that. And to be successful in our space, you have to be successful at both, and I'll come back to this in a second. We also need to have the ability to commercialize that innovation, and we also need to be able to have the scale to drive that innovation. So let me give you an example, over the past two years. Now, it's just a reminder, we've been a business unit for two years. Okay? We were a functional organization before. And part of the reason why you want to put functions together is you find innovation with intersections, and this will be a theme later when we talk about technology. And so between these intersections, you find opportunities to create value. So a couple of years ago, we saw, you know what? Reliability really matters, right? People buy a very expensive hearing instrument so that they can put it on their ears, and it stays on their ears. But what happens a lot in our industry is it comes off, it needs to be repaired. Very clear, right? People buy a hearing instrument, they want it on their ears as long as possible.... So we dedicated a team to focus on that and to improve. And so we have very ambitious targets to improve our reliability. But what was really interesting, as we were combined under a business unit, we started to see some intersections, and we had very unique data to be able to see that. Which is, yes, it's very important for the end consumer, but believe it or not, it can be even more important for the customer through our different channels. So they spend a significant portion of their time trying to problem solve technical issues, and that's not what they do best. They do best of providing hearing care, not fixing a hearing instrument. And so with a dedicated cross-functional team, we've been able to make significant improvements in what we view, including what the data would suggest, market leadership and reliability. So to that point, we talk about intersections. That's where innovation and breakthrough happens. What do you need in these intersections to make innovation happen? It requires collaboration, both internally and externally. That includes both clinically and with technology. So if you look at some of the studies that we've funded over the past few years, you look at what's happened with cognition. We have been highly collaborative with clinical partners in making sure we push the boundaries of clinical innovation, and there's more to come there. But it's not enough just to collaborate externally. You have to have a receiving end, which Arnd's gonna hit on after my presentation. You have to be able to take that innovation outside and incorporate it into what you're doing internally. And for us, specifically, as we talk through this next breakthrough, for us, that is proprietary chip innovation and process innovation. And you'll see how important that plays out as we go through what we believe is breakthrough. Last but not least, it comes down to people. It's innovation in our culture. And I think you'll see in this building, it is a very unique environment where we collaborate and we try things together, we fail together, and we succeed together, and that's a key component of what drives breakthrough, but also drives market leadership in our space. So let's talk about innovation in context of the end consumer, and that's what we're gonna focus on today. So I'm gonna reiterate it again, just like we do with our employees, we're here to make sure as many people as possible enjoy the delight of hearing. You buy a hearing aid. My father bought a hearing aid, my mother-in-law bought a hearing aid because they want to enjoy the delight of hearing, and they need sound quality, and they need to be able to hear in different listening environments, and we'll talk about the most challenging one, which is speech and noise, in a second, but they also need, as we've talked about, reliable products that they can keep on their ears, and in our modern digitalization world, people need connectivity, and they need personalization. So this is how we frame broadly, based on our end consumer research, what differentiates and creates value for the end consumer, so let's take a little bit of a step back. It was referenced by Birgit at the beginning that we've been using innovation and breakthrough technologies for a long time. If you look historically, most of the breakthrough innovation has been around hearing performance. So that goes back to AudioZoom. You'll see this in an upcoming slide. That delivered three decibels of signal-to-noise ratio improvement, which was a major breakthrough at the time. We'll go through some of the others a little bit later, but there's also certain innovation that takes place on ease of use. So you remember Belong, the first lithium-ion rechargeable battery, made life easier for the end consumer, and Marvel with MFA. Breakthrough innovation to be able to connect with the world around you. So if we look, as Arnd referenced, for the past six years, as we start to develop, what are we gonna bring to you in twenty twenty-four? So let me give you two use cases. I'll give you a little bit of insight into my family. Hopefully, not too much, 'cause I'm gonna talk to you about my mother-in-law, and I'm gonna talk to you about my father. So both of them have hearing loss, both high frequency hearing loss, but my father has low frequency hearing loss, too. And what's interesting in our lives, I come from a large family. My wife comes from an even larger family. So when we got together two months ago with different family reunions, they're exposed to this situation: a really loud environment. Okay? So my family, when we're all talking, and I've measured, it gets up to about seventy decibel levels. And hopefully, my mother-in-law doesn't listen to this. My wife's family, it gets up to about eighty decibels. Okay? For both my father and my mother-in-law, this creates a big challenge, and so my father responds in a different way than my mother-in-law. What my father does is he isolates himself, so he disconnects from the 20 grandchildren, walks into a room, and starts reading a book or looking on his iPhone. He isolates himself socially. Pretty significant. These are moments that matter for the end consumer. On the flip side, my mother-in-law will stay in the room, but she will not follow the conversation, and so we sometimes jump from politics to technology to literature based on what she hears and doesn't hear, and that has a real-life impact for our end consumers and has a real-life impact for me and my family. Up until this point, we have not been able to solve this as an industry. It is the most difficult situation to solve for from an engineering perspective and from an audiological perspective. But we've been able to do it this year... and it's 10 decibels of signal-to-noise ratio improvement, specifically in these situations. So let me walk you through why it's been so hard historically to be able to do this. So the challenges are, you can have a lot of different data. So you could take Google or Meta, and they may be working on this, they may not be working on it. You can have really great data, but you have to have the right data. It has to be real-life situations, okay? As we've known recently with artificial intelligence, you need, we call it large language models, but you need intense training to be able to take those real-life noises and sound instances and convert them in the right way to a signal. On top of that, it's really difficult with latency, right? We have 15 milliseconds to be able to process that data, that model, and the sound to get speech intelligibility in 15 milliseconds. Not easy to do technically, and up until this point, we've not had the chip technology to be able to pull that all together. It's a physics problem. It's size, processing speed, and energy, and if you look at the developments, and this is what's happened with AI, that is what has been the key enabler. That's why you see what happens with NVIDIA. This is how, at this point in time, we're able to make a breakthrough. All of you are asking, okay, hearing instruments have been using artificial intelligence. We've been using machine learning for 20 years. We've primarily used it on scene recognition, okay? Or sound classifiers. You can apply machine learning, you can apply artificial intelligence, you can apply deep neural networks anywhere you want on the sound processing, and the industry's been doing that for a very, very long time on scene classification, okay? However, what we have done is we've taken the data in real-life situations, we've created an algorithm, and we have created a dedicated chip and processor solely dedicated to solve this problem, the most difficult problem for hearing instruments, and that is speech and noise. And so we take that large, deep neural network, we apply it on a dedicated chip dedicated to that purpose, and that's what leads to a 10-decibel signal-to-noise ratio improvement. So to put this into context, and I'm looking around the room, some of you I know, some of you may have not, but, I used to tune my radio, AM/FM, okay? You had a dial. You think about it, this is exactly what we're doing with deep neural networks. We're doing it millions of times, though, with our language model. We're fine-tuning based on those millions of sound instances to try and figure out what is speech that you want to listen to and what is noise. And so millions of these dials have been fine-tuned using our deep neural network to get that output, and that's fundamentally what leads to that 10-decibel signal-to-noise ratio. So to open it up a little bit more, this is how we've been able to do it, okay? We have proprietary data with real-life situations. We've been able to model. Then we've taken a specific algorithm that takes that data, converts it, and fine-tunes it like we've outlined. And probably most importantly, we figured out a way to miniaturize it and actually put it on the hearing instrument from a size perspective, from a processing perspective, and also from an energy perspective. Not trivial to do. And so this is what we, from an engineering perspective, have viewed as the Holy Grail, and there's still a lot of things that we can do, but this is the first step, and you can see that with a 10-decibel signal-to-noise ratio. I'm just gonna emphasize this: We can talk bits and bytes, we can talk chips and hearing instruments. At the end of the day, it comes down to people. It comes down to the organizations, both internally and externally. And I'll turn the time back over to Arnd to kind of walk us through that journey. Thank you, Rob, for the first deeper dive here. Before we get to all of the insights on the technology and whatever, and more importantly, the customer benefits Oliver Frank will guide us through, we wanted to put a somewhat unusual element in here, which is probably relevant for at least part of you as an investor, at least when you look from a long investment perspective. Because yes, hopefully, we convince later that this is a big step, but then you sit there and wonder, who are the ones who can do a big step over and over when it's required, right? So comes the question: How do I manage technology breakthroughs? Let me use the term, right? A little bit is parallel, but from a different vantage point here. We want to share how we go about it so that you'll be the judge if we are the people who can do this over and over again when it's required, right? Rob already talks about you, you need to understand your customer. I think you need to have a clear vision on what your prime objective in life is, right? And it ought to be customer-focused, and it ought to be a still unmet need, because breakthrough ought to be measured in the words of the customer. It was a breakthrough on what I needed, not just the technology, which was complex and difficult, right? For us-... that happens to be and has been for many, many decades, that we see ourselves being enablers to help people enjoy the delight of hearing and live, live a life without limitation. Now, there's a power in that because our customers rally around it and our teams, which is important when you try to drive breakthroughs, because they're not easy. There's also an important filter when you sit there at a point of time and need to decide, do I do a more risky project? Do I do it right now? Do I put my resources there or where else do I want to put them, right? So in that regard, it becomes one of the key elements in our conversations on where do we put the extra effort, which we can afford? Now, some are with us for quite a while, therefore, I allow myself to go a little bit on a story over the last six years, and we're sharing today a little bit more what was on our mind, which we couldn't share when you asked a bunch of questions, right? And we heard your questions. They were not totally surprising. But if you go back six years ago, we're launching the Marvel. We get a little bit out of the hole with the B- Direct. And we talk all the time about an evolving innovation framework, where historically, hearing aid was the hearing performance and the comfort and fit, then we brought the connectivity, the tech stack grew. We then got, because of the connectivity into the remote and whatever else we have to do on applications level, where even now in the world, where we add some sensors for certain optimization, perhaps more in the future. So first picture on the left, the tech stack has grown, and you need to master every element of the tech stack. And by the way, they need to work with each other in real time, when they need to operate in real time. So it gets more and more complex. Now, at that point of time, which we didn't share as bluntly, we didn't say the wrong things when you asked, but we were a little bit focusing on the things we had to launch now. We also understood that if you ask a customer to follow Rob's guidance here on personal stories to the matter, my mom wears hearing aids since fifteen years, convinced her to take them because she didn't listen to the kids anymore. And so if I ask her today, she would say, as do other people who wear hearing aids since more than ten years, "They come a long way. On speech performance, oh, they are connectable, they are rechargeable, all these things. I can listen to music." The second sentence is, "I don't hear as well as I'd like to." Now, you can say that's a negative or positive. For me, it's a positive because there's work to be done, right? As long as the first sentence came, "Boy, they are so much better than ten years ago." And I think that's why you see our market growing. As much as everybody pushes on penetration, I understand, but if the market's growing at five, some of that has to be penetration, because the elderly population doesn't grow every year by 5% in the world, right? And we made strong progress, and you've seen in rechargeability, we have waterproofing and connectivity. But one thing was clear to us, if we think in terms of the core of deriving signal to noise, we're sitting with beamforming on a technology which comes of age. Now, you can improve it gradually, and that's what we did, and you can invent new algorithms in addition to the ones you have, but the core technology doesn't really get you that much further. So that was our mental recognition six years ago, and it's depicted here from a breakthrough perspective. It's a little bit of a different chart than Rob used. The timeline is about the same. If we would put breakthroughs, as we call them internally, beam steering, beamforming was one, which gave us a curve, which was significant in the signal-to-noise ratio. With all the technologies embedded on a hearing aid today, everything we've ever invented, it's about six dB, and we're actually pretty high relative to others with the existing technology. And then, yes, we went on the connectivity and rechargeability, and I think they made big differences. But if you go back to the core functionality, separating the noise from what you want to hear in speech, and that's still the most important, it is logical that beamforming, every time you further improve, the lift becomes a little smaller, right? So we were out to figure out, and we were out not just in a day, but obviously we do have our tentacles in the world, and we have capable people. We were out on what is that next thing, right? Go back six years ago. Today, AI, everybody talks about it, although most of the talk, I think, is GenAI, not necessarily we use AI to improve the consumer benefit on the core functionality. So we'll find a lot of GenAI. There's a lot of discussion by now. Is there too much hype for GenAI? I would say, but I would say if AI is your tool to get on the core benefit, the big lift, that's big relative to GenAI. We do GenAI at Sonova, but that's a different kind of department and functionality. Here, it's really deployed to what matters the most to the consumer. And yes, you need to think about capacity on chips and whatever. Now, if you look at the picture on the bottom, I think we're in a great position because until we shared Infinio and Infinio Sphere, we had the Lumity, which was all the technologies everybody knew. Now, there is debate, what's the better product and whatever. I would say we still on the last day before we launched Infinio, had a great product. Take one channel, which everybody gets published, was the Veterans Affairs. They choose on audiological performance and technology. They don't worry about commercials, right? So we're coming in before the Infinio, still at a high point from the performance of the Lumity. The Infinio, be as the technology without Sphere, is the next step on the existing technologies. We will share how relevant that is. Still very relevant. Doesn't give you a big lift in signal-to-noise, but the Infinio itself, we believe, is the best product, except for the Sphere Infinio in the world, right? But then you have, call it the turbocharger with Sphere, which is a tech core technology which comes on top, leverages everything which is in the Infinio and adds something on top, right? Now, that was why we had to do it. I said I want to talk a little bit about the how, because you have to think about, are these the people? First, obviously, you're interested in how great is the product, I understand. But ultimately, you also ask, are these the people who continue to do these kind of things, right? So what does it take in our eyes to drive technological breakthroughs? I think started with a vision. It's more profound than just a vision, but you have a deep-rooted understanding on what's the evolving consumer need. Then comes two elements of expertise in our eyes. The one is audiological. It's not easily replicated, and it's not the hearing care professionals. We love them in the store, but it's the more than one hundred audiological experts we have, which are not in the store, which work on innovation and R&D in the organization. Because you need to judge, can you make it work? What's relevant for the consumer? How do you embed it with all the other existing technologies? And then you get to the technology expertise. That's what you have already on the technology stack, if I use a term, plus all of the adjacencies, right? So you need to have scale. You also... In order to have these capabilities developed, you need to have a history of successes. You also need to be amongst the ones who do, as a chosen strategy, invest into some forward-leaning technologies, as we do, particularly on the microchips. You need to have the scouting on new technologies, because one thing will happen if you need a new technology which elevates the performance. It's not so likely that the people who work on the existing technologies will easily come up with that one, right? So you always need to have your finger out from a scouting perspective. There's academics, industry, startup partners. And I would argue the next one is an important one, perhaps lightly overlooked. If you have such a complex tech stack and it all happens in real time, and Oliver will talk about the millions or billions of transactions which happen on these devices in a second. Yeah. You need to be able to integrate new technology in real time, with everything happening already, without reducing the performance of what you had before, right? so you really need a strong architecture, and you need a strong technology in place. Last one is mindset on risk and the capacity to do it, so for me, I would be looking out for people. Do they have that? The technology evolves and you need to integrate more and more technologies. I think we have that in a very strong way. Now, lifting a little bit of curtain, not on the product, that's Oliver, but lifting a little bit of curtain on, on one little comment here, which we didn't share so far. I said you need to look on the outside, right? So sometimes you stand at a point, as we did six years ago, and you say, "If I want to build a new capability..." And honestly speaking, six years ago, AI and deep neural networks, I did not understand this stuff. I still don't very well, but a little bit better by now, right? And it, it was pretty new, and even today, it's going to be hard if you're, and we have to because we now have DNN experts in-house. If you want to recruit them, that's not easy. You're always competing with Google and Apple and whatever. In Switzerland, in Zurich, we have a lot of Google people who are trying to grab the people from ETH, right? We do too. So that's a little bit of a competitive environment on the labor market. But we had worked together with others. There's very few teams we knew in the world who already had started to use DNNs for speech enhancement in noisy environments, not necessarily as a target for hearing aids, but as something to deploy DNNs to. That's the way DNN people go. They deploy it to whatever problem they find in the world, and one of them we liked a lot. We thought, these are the most progressed people, and we said, probably two years we're saving on the development journey. So in that case, contrary to common belief, we don't just buy retail stores. We also may invest some capital in the right technology and the right team, most importantly, right? That was the start. Obviously, that's not making the whole trek. That's just getting you two years earlier on the curve on something you have to build in scale and you need to develop as a competence. So six years later, we have four-to-five times as many of that specific skill on the payroll than what we acquired at the beginning. We have them at two locations. One is in Berlin, one is in Stäfa. We have transferred a lot of knowledge, so don't think this was all done by the outside. It was just the, let's say, starting points you needed, and they needed to be, with their technology, integrated deeply into the places which are our core competencies, but which are also required to develop a fully functioning hearing aid, including Sphere. It does require a different mindset on leadership. Not just the colleagues in Berlin, we have the external chip partners, we have other partners on the whole grid, so it becomes quite complex. But I think that's what you are after when you're in the world of open innovation. I think you have a network of different capabilities. Many of them are on the payroll. We would not go as deep in chip development as doing the work for the people of the NXPs and others, but we have quite some competencies to guide instead. So it's a network which we have expanded, but by now-... I would say we are profoundly capable on the payroll and on the team to do DNN and AI in real time. Now, last comment for the ones who are judging these kind of processes when companies come together, small and large, it does require some thinking from how do you approach an integration. Because if I would be an investor, I would be sitting there and saying, "Wait a second, I hear lots of people acquiring companies, putting money on the table. Does that lead to results, right?" And yes, there are some risk in an acquisition, but you want to have a high hit rate, right? It really comes down to if you have a group of a couple of people in the dark, which is the true case, and you combine this with us, but you need to bring our machine of developing hearing aids and chips together with a couple of people who come from a very different space in mind. We quickly agreed, and Andi, our head of R&D, is in the room, who was with me on the journey for the last six years, and Steph, our head of innovation, the other people who made it all work and also spotted the opportunity. It really comes down to a soft integration approach, where you allow them to live in their world, and you do the minimal form integration, but you bring the teams together to have one objective. They were easily convinced that while they develop great technology, if they can get that on millions of hearing aids, that would be a dream for them. Right? On the other side, we were excited about learning DNN and making this a core technology and a core competence. You also need to over-resource these kind of projects. So there was a lot of hand-holding, not from the content, but from the project management. We needed to take all of the burden away from them at the beginning. Over time, it gets more and more integrated, but I think that was an important one. If I think about it, a measure of success, one measure of success for this acquisition, we're actually on time. If you would go back six years ago, we said it will take six years from here. The second one, like little hidden secret, the dB we're able to show is higher than we thought. And that's the beginning because this is a technology you can further improve. You've seen it was a curve. It wasn't a flat line, right? So in that regard, in that, the white paper worked out. I had the privilege to ask Peter. Peter and Elias, who are the founders of this company, just a couple of weeks ago, we were all kind of almost there, the launching. I said, "Help me understand, how did the integration go?" And Peter said, "Let me answer in a different way. Lots of people who were at the university with me, who started AI companies, said the ones who were acquired by Apple and Google, the product's out. The ones acquired by old economy, I think we're the only one launching a product," right? So in that regard, it's not easy to do this, and you heard Rob talking about the culture of innovation, the open mind. Hopefully, you see some flexibility in the approach as much as we're by now eighteen thousand people. But we always want to create the right frame in an integration or in a project we drive. But I think all of these elements which need to come together to ultimately be at a place to say, we're very sure, at least today, we're the first one who was able to bring real-time AI on a hearing aid, fully functioning. With that, Oliver is up and gets to the even more interesting part, which is: What does this thing do and how does it compare? Oliver. Thank you, Arnd. Hi, welcome. My name is Oliver Frank, and I'm the Vice President of Phonak Marketing. It is my distinct privilege to be able to show to you our groundbreaking new technology that we have just brought to the market. Now, I've been in the company and in the industry for seventeen years in various different functions, in R&D, in product management, in sales, and in marketing, and I think, I believe truly, that the innovation we have just launched is the biggest innovation. It has the biggest impact to the consumers, to the customers, and I believe, to the entire industry. I'm gonna present three different parts. First, I'm gonna introduce you to our new platform that has significant improvements in four core areas for the consumer and the customer. Then I'm gonna talk about the very specific value proposition that is built on top of this great foundation of our new platform, and it does address the core need of the consumers. And third, I want to share with you some impressions and reactions from customers. Now, we do a lot of research, surveys, to find out what are the unmet consumer and customer needs. How can we better satisfy them? How can we delight them? People don't dream about wearing hearing aids. People dream about hearing perfectly, discreetly. People dream about fully engaging in all moments of life. It all starts with sound quality. We do understand the impact that hearing loss has on people's life, on people's quality of life, because the hearing loss is between listening and the interaction with the surroundings and people. So hearing loss has a profound impact, and it breaks these interpersonal connections, whether someone is whispering or whether there's any other important moment that you don't want to miss. So we need to deliver great sound quality and clear sound from the very first moment the hearing aid is turned on. We want people to be able to maintain and build the social networks, like Rob explained, in his family gatherings. But we also have to acknowledge that social networks today are often virtual, remote, at the touch of a button instead of a touch of a hand. So in order to bridge to the digital universe of the consumers, we need easy-to-use and seamless connectivity that is stable and reliable. Now, reliable connections, I mean, quality and excellence goes beyond reliable connections. There's an astounding dependency for people with hearing loss on their devices. If they don't have their devices, they're missing out on the delight of hearing. If they don't have the devices, maybe they have some repairs and service. That's a hassle. It's waste of time, and it also often costs money to businesses. So we are dedicated, and we have committed to take reliability to the next level in the industry. And let's not forget, people would like to forget about their hearing loss. They would like to forget about wearing hearing aids. So the solution, they really need to be seamlessly integrated. They need to feel like an extension of oneself. So we need to be able to personalize from that very first moment through sensing the environment, adjust the hearing aid in the right, proper setting, to have the physical best coupling in the ear every step on the way. We have pushed the boundaries, and we have made a dream come true. Let me introduce you to Infinio. So these are the core pillars of Infinio. It's exceptional sound quality from the first moment, it's market-leading connectivity, taking a giant leap forward, it's quality that doesn't get in the way of life, and it's personalization to really complement the consumer's personal needs. I'm gonna talk about all these four pillars one by one. I'm gonna explain to you how we've taken it to the next level, and I'll also show you some evidence behind it. So exceptional sound quality from the very first moment. This is super crucial, and how did we achieve that? It all starts with APD 3.0. This is the Phonak, the Adaptive Phonak Digital. This is our pioneering audiological model, and I often refer to this as where the magic is happening. Because based on all the diagnostic information and all the counseling from the hearing care professional, there's all these parameters and adjustments that need to be done in the hearing aid to then deliver that perfect sound. We also have an AI dome proposer, and now a dome is one of the solutions that you put on the speaker of the hearing aid to couple into the ear. This is important for a good physical fit, but also for an audiological fit. So it's creating that best match between the diagnostic and the counseling to then couple it in the best possible way. What we've done is we've created an AI-based solution to propose the best possible match for any given consumer. That's based on thousands of hearing care professional data in real life, and we're now able to propose that to the hearing care professional as an easy step on their journey of counseling. Of course, it also comes with AutoSense OS. It's our sixth generation of the system that senses the environment all the time and continuously adapts to the listening environments and the consumers' needs in that situation. It comes with SmartSpeech Technology and a whole host of features, improving understanding, reducing listening effort, and ultimately also reducing the fatigue. I guess you would all agree, first impressions really matter. Now, how would the perfect experience for the consumer and the hearing care professional look like in terms of the fitting? How would that look like? Ideally, I think you walk into the fitting office, you have that perfect diagnostic done, you have the counseling done, and then without any adjustments and fine-tuning there afterwards, you start loving that sound when it's turned on and every moment afterwards. This is what we achieved, and we have tested it with a leading competitor. And trust us, we always measure ourselves against the best in any given domain. So we've done a study to measure that first impression. We've taken first-time users, they've done all the diagnostics, all the counseling, and then adjusted the hearing instrument according to the manufacturer's prescription, so in our case, the APD. And the result, to be honest, have taken us by surprise, because 93% of the consumers preferred the Infinio sound compared to the leading competitor. Now, that means the hearing care professional has more time to focus on patient-centered care and doesn't have to do adjustment and fine-tuning afterwards. But what if the consumer leaves the office, and they go on to live their lives? We are able to provide 21% less fatigue and 45% less listening effort. Now, I wanna talk specifically a little bit about the 45%, because that's a brand new, hot-off-the-press study that we published last week, and it's really an interesting way how we did that. You probably all experience, if someone is talking from another room, it's a bit more difficult to understand. It takes a little bit more effort. I've certainly experienced that myself. But sometimes, to be honest, if my wife is calling me, and I hear her loud and clear, usually that means I'm in trouble. But we have been able to deliver 45% reduction of listening effort when all the features are turned on. We want people to be able to maintain and build those social connections, but social connections are not the only connections we're gonna talk about today. We have taken market-leading universal connectivity, and we've taken it a giant leap forward. We have the universal connectivity that connects to all the Bluetooth devices. We are able to connect to two devices at the same time, and if you wanna swap it out for another one, we are able to pair to eight devices. So, all you have to do is connect the button, and you don't have to do the pairing all the time. But why is it so important to be able to connect to two devices? So let's assume you're watching a Netflix, whether that's on a TV or a tablet, but you also have connected your smartphone, and someone is calling you. So either you just quickly pause the Netflix, or with a touch of a button, you can pick up that phone, you can engage in a phone conversation, and when you're finished, you go back to watching that Netflix. It's all so seamless without any interruptions. We've also taken a giant leap forward in terms of the stability and reliability of the connections we can provide. We can provide twice the distance in terms of hands-free phone calling, and it's not necessarily the distance that's key, and I'm gonna talk about that in a second. It's really that stability, whether the phone is in the pocket, whether there's any objects in the way, we have an uninterrupted connectivity, also in hands-free phone calls, and it's so ultra-responsive. Let's take another example. I'm listening to music streaming into my hearing aids. If someone approaches me from the side, and this may sound like a very little detail, but I can assure you, it really matters to the consumers. If someone approaches me to the side, I can quickly pause the music stream, and without missing the moment, I can engage in that conversation. That wasn't possible before, so this is really without any word slipping by. Infinio is powered by the all-new Era chip. This is what enables the great sound quality and the stable connectivity. We are able to connect to all Bluetooth devices in a really stable and seamless way. We are able to do that so instantly, we can reboot and connect to a smartphone three times in the time it took us with Lumity. This is all enabled by six times the transmission power that really provides that stable and smooth connection all the time. Now, we want to be able to offer really seamless solutions that connect to the entire digital universe for the consumers. That's today. But when tomorrow comes, when Auracast becomes part of the consumers' lives, Era is compatible to Auracast. So Era is a true multi-talent. It has Bluetooth Low Energy to do remote controlling, whether it's from a physical device or from the app for Target fitting adjustments. It's Bluetooth Classic to be compatible to all Bluetooth phones, including TVs, if they support that. If not, we have a specific protocol that's optimized for that AirStream technology with a TV solution. We have Binaural VoiceStream Technology that exchange the audio between the two microphones to create that more narrow beam when the user needs it. We have Roger Technology to really create a seamless solution with Roger Insight, and it's Auracast ready. Now, we've taken it to the test, and I referred to it before, there's more distance. We wanted to test the stability and the seamless and reliable connectivity that we had. So we created a test that is fair and reproducible compared to competitive devices. So we used the distance that the hearing aid can connect to a smartphone as a proxy to measure how good the connectivity and stability is. You can see at the top, it's comparison to Android phones. You can see the Infinio device. It's about one point five times more distance that we can cover with a seamless and stable connection. And with the Apple, it is even up to 2.5 times the difference. When we ask hearing care professionals about what are the choice drivers, what really matters in terms of what product they use? Reliability consistently scores very high. So we are committed to take and lead the industry to the next level in terms of reliability. We do that by focusing on the entire ecosystem, whether that's connectivity, whether that's charging, whether that's the ecosystem with the apps, whether that's the design that is really tested and proven to withstand everyday challenges. We are testing our system beyond IP68. IP, that's the industry standard for ingress protection. So the five is the dust and the eight, the six is the dust, and the eight is the water, but that's not good enough for us. We are testing beyond that. Now we have, I would say, the industry standard in terms of reliability out there with Lumity Life. That's a specific product we have in the Lumity platform that is really considered the golden standard. We've taken all that learnings, and we are now applying that in the third generation with all the improvements as a standard offering in the Infinio range. This ultimately means less hassle, less time spent on service and repair, and the hearing care professional can really focus on that patient-centered care. We have tested our devices 10,000 hours with what we call torture tests, because we don't want to spare our devices any pain. Obviously, we want to spare that to the consumers and customers, and we have tested them in 135 different tests. Now, what does 10,000 hours of testing mean? If you take an average consumer, 13-14 hours wearing time a day, 10,000 hours means there's two years of continuously testing the devices on a patient ear, and again, this is to provide longevity, durability, and reliability that really withstands the challenges of life. Infinio is personalized in so many ways. There's the AI Dome Proposer, as I mentioned. There's the acoustical perfect fit, the physical perfect fit. There is... Whether that's changing the adjustments in the app, whether that's fine-tuning in Target, whether that's sensing the environment all the time to really make sure the acoustical environment is considered, the intention of the listener is there. All those things are taken into account. But there's also the Swiss precision biometric calibration. That takes one thousand six hundred data points from ear impressions or from ear scans to really create that perfect physical fit, that customization, whether that's an ITE or whether that's a RIC coupling. Now, you heard right, custom ITE, because Infinio is also available as a custom ITE, so we are offering a really seamless charging solution with the Virto R. It's our first rechargeable ITE, and it really, if you put it into the place, the snap and charge sucks it into the right place and charges it. It's so easy to use, and don't forget, it's the first Virto that's rechargeable. It's the first Virto with an accelerometer. It's the first Virto with SmartSpeech Technology. It's the first Virto with touch control, so I believe every ITE user out there, if they get to wear a Virto, they will really see the difference. Infinio is enabled and powered by Era. All of this, all of this is Infinio. It's the Virto rechargeable, it's the CROS for unilateral hearing loss, comes with an extended battery life, 16 hours or more, and it's the Audéo. All of this is based on our four core pillars, which is incredible sound, unmatched connectivity, quality that withstands the challenges of life, and personalization to complement the consumer's personal needs. Unlock a world of possibilities, where exceptional sound quality meets comfort from the very first fit. Powered by our new proprietary Era chip that brings a new level of sound processing. Regardless of the environment, it adjusts your hearing aids to your surroundings every step of the way, so that wearers can enjoy the moment, a word, or a call. Thanks to the ultra-responsive Era chip, also hands-free, uninterrupted calls and world-class leading Bluetooth connectivity are possible. Developed to withstand the challenges of life, Infinio is Swiss engineering at its best, so wearers can be ready for anything. Truly personalized, Infinio makes life feel and sound extraordinary, and built-in RogerDirect allows for a seamless connection to Roger microphones. So this is Infinio. But maybe you remember when Rob presented the pyramid, there was the vision on top. There was a fifth pillar, right? There was a fifth core need for the consumer, and not just any core need, the most important need for the consumer, speech understanding in noise. So this is the family gathering, as Rob described, or any other situation when you're in a loud environment, in a restaurant with music going on, this is where the consumers still struggle the most today. So in our pursuit of the vision, a vision where there's a world where everyone enjoys the delight of hearing without any limitations, we knew the technology we're chasing. We knew what the number one consumer need is, speech understanding in noise. It always have been, has been. But there's also plateaus that we saw in terms of the technology and the capabilities, so we had to dream bigger. We had to think beyond directional microphones and beyond beamformer technology. But before we go into too much details, I just wanna recap a little bit. What's really the job of a hearing instrument? There's two aspects that the hearing instrument really needs to do. The first job is to classify the sound, the sound environment the consumer is in, whether that's listening to music, whether that's a two-way conversation, whether that's relaxing, whether that's some conversation in a very loud environment. Depending on that situation, the hearing aid has to do different signal processing strategies. And some competitors have started to use DNN as a technology in the classification and to do some sound parameter steering. We have twenty-four years of experience with AutoSense OS and AI, and I would say classification is a pretty well-solved problem today. The core number one need for consumers is understanding in noise. What if we could apply a paradigm shift, a different thinking, in tackling that problem? What if you could apply large-scale DNN to the actual sound processing, so when the sound comes in, then we can separate the unwanted noise from the wanted sound? So we did dream big because we knew there are plateaus, and we didn't want to be faced with incremental benefits from then onwards. As Arnd and Rob explained, there was really two events in the history. In nineteen ninety-four, Phonak introduced the first dual microphone system, which gave us the capability over time to increase the three dB signal-to-noise ratio. When we introduced a four-microphone system, where the two audio were connected between the two microphones in both ears, we were able to create an even more narrow beam for when the user needs it. But don't worry, we're not gonna come up with eight microphones, because we have really started to dream about large-scale DNN to solve that problem. What if you could lift it to ten dB? And let's not forget, what if you could lift it to ten dB, but not only in a narrow beam, but from any direction? So this is what we were dreaming, and this is what we set out to do. You probably all have been on video conference calls in the past. In Sonova, we use Teams, and I probably have spent too much time on Teams calls. You've probably all experienced situation where it was really noisy around you, whether there's a lawnmower going on or kids playing in the background, particularly during COVID times. I think we've all been there. I felt sometimes almost a bit embarrassed because I thought the other end would not be able to hear me very well, but it turned out they said, "No, I don't hear any noise," and that's because there were really powerful DNN algorithms that run on these really powerful computers, so we're like, "Well, let's just do that in hearing instruments." Obviously, it turned out not so easy. There are a few obstacles we had to overcome, so here we have depicted a small neural network. You can see the nodes that are the neurons and the connections between them. If you have a simple neural net, there's also only so much complexity in a problem you can solve. To really separate speech from noise, we knew we needed large-scale DNNs. And trust me, the number of neural connections, that will not be possible to show in this picture because it's millions. We knew we needed ten times more neural connections than any chip that was available on the market. And in order to be able to handle all those neural connections, it's like in the brain, you need memory to be able to store and save and process that data. So we needed twenty times the memory compared to any chip available on the market. And obviously, we're not in a position to put a backpack with a computer on the consumer's back in order to handle all that processing power that's needed. The efficiency and the energy that Rob also alluded to, we knew we needed four times better efficiency in terms of energy management compared to any chip available on the market. And there is a need for speed, because you have all that sound coming in, you have the millions of neural connections that you need to process, and then there's the sound coming out. We wanted to separate the wanted sound from the unwanted noise in real-time, all the time. So that's the need for speed, and we knew we needed fifty times the processing power in order to be able to handle that. Sometimes dreams are closer than they seem. We have designed and developed our own proprietary chip. We call it Deep Sonic. Deep Sonic is able to create the speech clarity that we were dreaming of. We were able to fulfill that need for speed with fifty-three times the processing power. We have twenty-two million sound samples. Now, if you have a simple neural net, you can have as many sound samples as you want, you're not gonna be able to solve the problem. But because we have four point five million neural connections, the twenty-two million sound samples from different languages, different environments, where we have really trained the system to separate the wanted sound from the unwanted sound. The system is fulfilling that need for speed with seven point seven billion operations per second. So that's billion with a B. I think that's incomprehensible. That's such a large number, but it is needed to do this in real-time and all the time. So we call this technology Spheric Speech Clarity. We are able to provide ten dB of signal-to-noise ratio. That's the benefit that the consumer is getting. But what, how does that translate really in consumer benefit? It means the consumer is able to understand, is more likely to understand two to three times every word from any direction compared to any solution out there today. At Phonak, it has always been our dream to ensure that words are heard clearly, even in a world of noise. But this dream of speech clarity and noise has been limited by the constraints of processing power. The capabilities to unleash the full potential of AI technology just didn't exist until now. For the first time ever, we've broken this technological barrier by developing our own proprietary chip architecture, Deep Sonic. Designed to separate speech from noise, it is 53 times more powerful than current industry standards. It's so powerful, it enables a deep neural network with 4.5 million neural connections to instantly separate speech from noise like never before, for speech clarity from any direction. We've put this breakthrough technology into the new Phonak Audéo Sphere Infinio. It's the world's first hearing aid with a dedicated AI chip, unlocking an unprecedented 10 decibel signal-to-noise ratio improvement, providing a level of clean and clear speech far beyond any existing technology. The benefit is that wearers will be two to three times more likely to understand speech in any direction. Clearer speech allows to focus on what's relevant, and when clearer speech is heard, wow! No wonder 10 out of 10 hearing care professionals reported Audéo Sphere delivered an outstanding listening experience. Yes, every single one. What's in a word? Everything. Unlock a world of possibilities with the new Audéo Sphere, part of the Infinio range. Phonak, life is on. Audéo Sphere is really a paradigm shift in technology, and I believe it's a true inflection point in our industry. With Audéo Sphere, we have used the Deep Sonic chip in addition to Era, in addition to the already great Infinio platform. So there's two chips, and one of them is dedicated only for this one problem, the most important problem for the consumers today, which is understanding speech in noise. I want to share with you some clinical data and objective measurements. Here you can see how in the evolution over time, from the three dB on the left side to the six dB, the plateau we mentioned before with the StereoZoom, we're now able to break through that and really transcend the limits of hearing care to ten dB and from any direction. Now, we also obviously wanted to compare two competitors. You can see at the bottom in green, that's the Sphere Infinio, and it clearly outperforms the competitors. Two of them have AI and DNN in there, and one doesn't. And don't even think that the one without is at the top. We are able to provide 50% more access to speech cues than any of the competitors, and we are able to do that not only from a specific direction, from any direction, instantly, and all the time. Now, in addition to the objective measurements, we also wanted to hear from consumers subjectively on what they think about Sphere. You can see here depicted the four dimensions we have asked them when we had them in speech, in loud environments, in two-way conversations. We asked them for speech clarity, speech naturalness, speech and noise separation, and overall satisfaction. Now, if you're not biased by now that Phonak and Sphere is green, I think you would easily pick and say green is clearly outperforming the others. If you have a more closer look on the second dimension on the left, the speech naturalness, I think you could be mistaken and say, "Well, there's one competitor that's almost as good," but it turns out it's the outliers at the top, but also outliers at the bottom, and if you look at the X, that marks here the mean or the average performance. Sphere also clearly outperforms in this dimension, so this really translates in a consumer benefit, which means the consumer is two to three times more likely to understand every word from any direction, and we have scientific data to prove against two competitors. But trust me, because it's such a paradigm shift, this is compared to any solution out there in the market. We have a lot of evidence, we have a lot of studies, but this is just the starting point. There's a lot of studies on its way. We will be able to provide much, much more going forward, but we've only launched the product two weeks ago. So Infinio is based on the four core pillars of incredible sound, unmatched connectivity, quality that doesn't get in the way, and the level of personalization so that really complements the consumer's personal needs. And now we have added the fifth and most important dimension for the consumer, which is to provide speech clarity in noisy environments. Now, I want to share with you a few expressions, impressions from the launch, and we were thinking about: What's a good location? What's a great venue to be able to take this revolutionary product and match the level of magnitude, the level of impact it has on consumers, customers, and the industry? I could not think of a better place than the Sphere in Las Vegas. Sphere stands 157 meters high, and it was the perfect location to unveil to the world this groundbreaking, groundbreaking technology. But it was also really good because we could project on the outside, raise the awareness, and raise awareness on hearing instruments and hearing care in general. We've been overwhelmed with the reactions. We have 20-plus industry journalists, and we have reached ten... Sorry, more than 100 million really overwhelmingly positive sentiments. We have 12 times the reach compared to previous launches. So we were really taken, not by surprise, I think that wouldn't be fair, but we were overwhelmed. But let's hear what customers had to say after the event and after they had a chance to listen to Infinio. The most common problem for our patients is hearing and background noise, and I feel like with the new Audéo Sphere and the new Audéo Infinio, that it's really going to deliver that performance that they've been looking for. The way that it pulls speech out of noise is incredible. The 10 dB signal-to-noise ratio is almost just like having a Roger without having the Roger. It's amazing! I'm so excited to talk to my patients about this and to tell them about how much better they can hear in background noise. That's the solution that we're still looking to solve, and I think this has made a huge leap forward, really. The technology is just getting better and better and keeping up with the times, for sure. I think it's going to help so many patients hear better, and it's going to make a lot of people very happy. It's going to change a lot of lives. We've also done customer surveys at the event, and I'm going to share with you three data points, and don't, don't worry. I didn't pick the best ones, because I can assure you the worst data point was 97%. So we have really broken all the internal records, but I wanted to share with you the ones that I feel like are the most meaningful ones. 98% of the respondents said that Phonak Infinio is going to change the lives of their patients. 97% agreed that Sphere is a strong competitive advantage, and every one of the 104 respondents said it is a significant leap forward in innovation. We have a saying, "Hearing is believing," because we want to be able to really convey that benefit in terms of hearing it, right, so I'm going to play a little sound sample. It's a recording that was processed with the Spheric speech technology, and I'm also happy to use the opportunity to express how grateful I am for Paul Gilbert. He is a true rock star, quite literally, from the Mr. Big band, and he's one of our Phonak ambassadors, and he really helps us to create awareness and raise the awareness for hearing care in general. Listen carefully, because you may miss it. It forced me to come in behind the beat. I had to, like, scrap it and re-record, you know? I'd have to fudge it maybe later by nudging the track or something, but this was, like, the eighth-note song. Wow! I was, like, so behind the beat because when I press it down, all of a sudden, the pitch shift stuff was behind by, like, 10 milliseconds. I mean, it's enough to make the feel off, you know? Yeah. It's... So, yeah, I- As soon as- Yeah. As soon as it gets in your head- Yeah, yeah. Then- Yeah, it's hard to... So with Infinio, we have launched our broadest portfolio today in Phonak to really cater for the variety of consumer needs out there. We have Audéo Sphere, we have Audéo R, we have CROS, we have Virto Rechargeable, Virto Titanium, and Virto 10. We refuse to accept that people with hearing loss start to feel like their life is smaller. And I use a quote from Paul Gilbert when he said, "Social connections," that's for him, the requirement of life. So we will keep pushing the boundaries and use this inflection point to further increase the benefits going forward. But before I leave you, I want to share a very quick anecdote from when we launched this product internally in Helsinki a few months ago. In the evening, we had a party to celebrate because we knew this is a true watershed moment. Jennifer approached me, and Jennifer has a hearing loss, a severe to profound hearing loss, and she had the chance to test and wear the Phonak Audéo Sphere for a while. As the party went on, the music was loud, everyone was talking at the same time. We had a quick chitchat, and within two minutes, three times, I had to reel it in and go, "Sorry, what did you say?" The third time she went, "Joke's on you, my friend" because she literally was able to understand better than me. That really made my day then. Thank you very much. So we will now go to the first Q&A session. Can I ask the presenters please to come up to the stage? As a reminder, this first Q&A session will be for participants in the room only. So anyone who would like to ask a question, please raise your hand and we try to get to all of you. Hello, and thanks for taking my question. This is Maja from Kepler Cheuvreux. I have three questions, if I may. You show some remarkable advancements with Sphere. It seems to have a real impact on patients' life. Therefore, my question, why are you going with two different models? Why the Infinio and why holding it back if it has such a big impact on consumer lives? Are you going to use the Sphere to manage care and the VA? And my last question is, I'm fully aware of the fact that you're not going to give us any numbers, but could you give us any indications on the gross margin between the different products? Thank you very much. ... Great! Now, how about we divide them up? I'll take the first one. So when we talk about innovation, our goal is to have people enjoy the delight of hearing, and in this case, we developed both platforms simultaneously. And, we decided that we wanted to offer all the technology that we could. Now, obviously, to your third question, it cost us a lot of money to develop this. Arnd talked about the acquisition. So part of what we need to do from a positioning standpoint across different geographies, is we need to make sure we have the latest and greatest technology at the right, price points. And so that's why we've decided to launch, our largest - one of our largest platform launches in history, including multiple form factors at different price points. So if you think about it from a marketing strategy standpoint, it's a pincer move, where you have, versus the competition, the latest and greatest across different technology levels, including the Era chip and including the Deep Sonic chip. So it offers a broader solution with the latest innovation to the broader group. Do you want to take the second one, or you want me- I'll also add one to the first one. When you see the devices, actually, the sphere is a little bit larger, and some people would say it's more larger, right? So we're also not so sure where the tier ratio falls out, because, yes, you have a benefit in the mild to moderate, but there's also more profound for the severe to profound, right? So in that regard, rather than saying the one has some downsides, but strong upsides, we only bet on that one. I think it was a trade-off to be made, and I think the tier ratio will show, obviously, with different price points. Let me just clarify, 'cause geographically, there are different end consumer needs, okay? So one of the things, and I'll give you a real-time update after two weeks of user feedback. We do find in certain geographies, size is a bigger need than other geographies. Interestingly enough, as we've seen the initial results out of the U.S., the benefit of Spheric speech recognition greatly outweighs the size. So we'll see how that goes across different geographies, but, we do expect in certain geographies, size will be, a different parameter versus the U.S., as an example, where size matters less, less. So on the second question, do you wanna answer? I'll take the second one, because we had more discussions on managed care with many of you in the room with me. I think first, I think managed care is a relevant, meaningful channel, and that we got customers to ours. With regard to helping to drive more people getting hearing aids, I think it had a clear impact on penetration in the United States of America. I think also you need to see there are different managed care programs at different price points, very high-value contracts, depending on what type of insurance you have, and by the way, who our managed care provider is. So I think it's not as black and white. I think we want to serve the customer and to the customer, the consumer. On the other hand, I think clearly we position, particularly the Sphere technology, at a different price point, also in the conversation with managed care partners. So ultimately, it's on them to decide in which of the contracts they have, at which price levels, we're in the formulary, to use a term, they want to use, ultimately, that kind of technology. But we're not in a position to holding people back from getting technology if they deem to do so. It's probably another comment to be made, right? But in general, I think we like the channel, but I think they need to think through where is this the right device at the price point we can offer versus other devices. The last one on the margin side, I think, the costs are higher, ultimately, with a third chip. In addition to that, I think significant additional investment over the last couple of years. But I think the price premium at the end and probably also it being skewed more to the higher end of the performance factors will weigh that out. Yeah, that would be our read at this point of time. Thomas is the master. Hi, thank you for taking my questions. It's Marco here from Barclays. I just had one question on the VA. Again, just to reiterate what was just said, seems to be an impressive launch with the new chip, offering some meaningful benefits. If you were to compare this launch versus your prior launches, such as going all the way back to Marvel, to Paradise, to Lumity, how should we think about the ramp-up in technological advancement that you expect in this one versus in the past, in terms of share gains in the VA? Should we expect something more similar in line with the Marvel launch, which was a highly successful launch in the VA and more broadly, or should we expect something more similar towards maybe a Lumity or a Paradise? I think the first comment would be, you need to be careful when you just take the increase, and you need to compare what your run rate before was, right? Because the Marvel came on the back of the B-Direct, and on the B-Direct, we made... And we said that at the time, but hindsight, a mistake, we defeatured on the speech enhancement because we wanted to get the MFA in.... Right? And so there was a big pushback, particularly from audiologically performance-sensitive customers, VA, and I think we went down to 25% market share in VA. So from 25 to 50 is also 25, but it's based against a level we never had before. And I think people were super happy that the Marvel showed we still believe in audiological performance. So just a background on the Marvel side. I think there is, with good technology and upside, a limitation to the market share you can get if you have very convinced audiologists and very convinced also patients and consumers. So I don't think we're in a good position to share what percentage, because we don't even know exactly. But I think, yes, it is well recognized that this is a channel which likes better hearing. And VA tends to be more on the severe to profound side from the average patient base. Thank you. Good morning, Uwe Kunz from Research Partners. I have a question on battery consumption. If Spheric Speech Clarity is on all the time, how long will the battery last? And then is that not somehow a drawback, or is there an automatic process that puts it on and off, so I don't lose too much energy? Should I take this one? Sure. So the Sphere is designed to last for sixteen hours a day, and in those sixteen hours, you can do five hours of streaming, you can do three hours of being in the loudest environments where you really need that boost that the Deep Sonic is providing. And we usually, when we do the specs and the claims around that, we use. We do these claims for years of use. So the sixteen hours is really a conservative number, and it is going to be enough for most users for most of the times. And if you do need an extra charge, you can charge it for like fifteen minutes, and then you get another three to six hours of battery life. So we don't see that the battery life is going to be very restrictive at all. Two additional comments to put that in perspective. When you, when you analyze user behavior, which we can, because every hearing aid which gets back to an audiologist, we can read out what kind of environments and profiles were chosen. The three hours is the vast, vast majority, so well above 95% of what, what people have is their normal time in noisy environments. The other one to your question, it switches out automatically so that you're not having five hours of deep neural network, and then you can't have hearing for the last three hours in the day. So there's, there's a control mechanism. Hi, good morning. Julien Ouaddour from BofA. The first question, can you help us to, I mean, have a clear idea, or what's the split do you expect between the classic Infinio and the classic Sphere? I mean, just like for the rechargeable form factor. Then, do we have any update from Costco? Maybe you were a bit more constructive on the full year results, and you have a new tech now, so could you envisage to put it in Costco? And third question about the DNN. I mean, some of your competitor, they have already their third version of, let's say, like, of this technology. You have real-time AI, but I mean, like, does it matter the way you train the device? And if it does, I mean, where you come, I mean, why different versus them? And also, how long it would take for them to catch up? Thank you. All right, so, why don't I take the split from a product perspective, and then we can decide how we break the rest up. So our original assumption, going into this, based on end user data, was that we were gonna have about 30% Sphere and 70% Infinio, based on the previous question about positioning and from a pricing perspective. It has been the inverse of that as we've launched in the U.S. So we'll see what steady state is, but the demand on Sphere has been, significantly more than we anticipated with our initial market research. We'll see how that plays out across different geographies. Obviously, you have to remember, the U.S. is at higher tech levels, as a proportion. Other geographies, sell lower tech levels, so that answers part of the previous question, too. So we'll see how it plays out, but we're using real-time market research to make sure that we're allocating appropriately. Just briefly on the large customer in the United States of America. So no update. Nothing has changed relative to what I said two or three months ago. We are in respectful with each other, and I think there's a good case to be made that eventually we come together in some shape or form. I think to your specific question with regard to the technology, like Infinio and Sphere, I think on these kind of customer relationships, which are to a degree strategic, I don't think it's a matter of one product cycle. I think at the end of the day, I would be looking from their side. This is a credible company which can continue to evolve the technology. Are they serving me well? Do I feel they have a good reliability and elements like that? So in that regard, I don't think one particular product launch changes this dramatically. I think it's really more the experience they have and had with us, which will make a difference there. There was one more question, right? ... do you want to take the last part of that question? You have a good two to three years. We expect competition at some point. They have not disclosed the level of detail that we have just disclosed, and we've tried to keep it somewhat confidential at this point. Obviously, we're opening it up to you guys to see, but it takes a long time to get data. It takes a long time to get the right data. It takes a whole lot of time to figure out how you can miniaturize that, and it takes a whole lot of time to create a dedicated chip to do that. So- I think if you hear AI, obviously, you can deploy AI to many things, but as we were laying out, if you want to put it into the full stream of the signal, and that was what Rob showed, you need to pipe every piece of the signal in real time through. Not some adjustment or a little bit, or I trained a profile and whatever, and I don't want to be disrespectful in any shape or form. I'm just trying to explain the technical issue. Then you're going to get to the size of a chip we needed, right? So that's your first requirement. Secondarily, and that chip technology, if you need to do proprietary, we haven't seen anything on the market which can do this, and it's as small as we need and the battery needs, so we had to go proprietary. So chip, four years. CMOS technology has never changed. Always four years, and then you need another one to two years to specify what you need in the chip, right? So that was our six years, right? And we're reasonably fast, right? We don't know if anyone has started, but we know with the technology currently in the market, there is no such chip which is anywhere commercially available on those devices. On the training of the DNN, yeah, in addition, parallel to the chip, as I said, they were on the journey for two years to work before we got together on how do you optimize DNNs, and then you have massive training of the DNN network to ultimately get it to the performance and the low energy consumption. So I think there's another work stream which needs to happen in parallel. You need to, at scale, train the DNN, right? You can do that. Keep in mind, no matter if somebody is close or not so close, we have a pathway to continue to evolve our technology because we didn't stop training the DNN. It still gets trained every day, right? In two years, you're going to see one which is more performant and may do a couple of other tricks. We're feeling good right now. Thank you. It's make sure we're done. Thank you. It's Graham Doyle from UBS. Just a couple... firstly, on the launch strategy itself, so sort of a follow-up. You've obviously gone with two platforms. Have you had a decision like this to make before, where you could have gone with two platforms and you chose not to? And the feedback we got from the Vegas launch was super enthusiastic about speech and noise and super enthusiastic about the Sphere. But is there a risk then, we think of going back to that sort of size and battery potential limitations in certain markets, is there a risk that people aren't as well-versed in the benefits of the more classic platform? And then just one on manufacturing. It'd be good to get an understanding as to how this differs from what you've done in the past. So what are the challenges, or are there that many more challenges from producing a second platform? Thank you. Let me cover the was there one, and then I can hand over for the second part. I'm not aware, trying to see. Andy's not... He's the longest on the journey. He agrees, we, we didn't have a situation like that. It, it comes from we clearly develop at full speed our normal two-year cycle, that's Infinio. And if you wouldn't have Sphere, Infinio is a great product, by the way, right? And you could see there's another chip in there which was needed on the connectivity and takes the connectivity to the next level. But because when we started with the artificial intelligence, we didn't know, are we going to hit the timeline? We were not busy with trying to plan at that point of time, what lens, man, right? So in that regard, we never had two work streams, like the regular product development and then this extra project in parallel. So we didn't have a decision to take like this. We clearly took the decision that when it's ready, we want to have it out there, right? And therefore, it becomes a little bit more complex launch strategy. I think from the discussions I had with some audiologists in Las Vegas after they had their day with all the engagement with the device, I heard them already playing in their mind: Am I going to go with Infinio? Where do I go with Infinio Sphere? What's their, what's their need from a hearing loss perspective? What's their affordability side, right? So I think while we don't know all the answers in the sum of the parts, there's very clear segments where you go with one versus the other. Yeah, two parts. Number one, we're super proud of Infinio. If you look at what it does with connectivity, if you look at what we've done with reliability, and if you look at that first fit performance that Oliver talked about, it's a dang good platform, and so we're super proud of it, and we want to market it. So specifically on your supply question, obviously, I shared the data of what we anticipated, and obviously, it's very different. So we have had to make some trade-off decisions on what we manufacture and when. Obviously, we're needing to manufacture more Spheres than Infinio at current state. but we're trying to be entrepreneurial, we're trying to use real data, and sometimes you have a hypothesis based on consumer research that you do, but it turns out to be differently, and we're being agile in how we approach that. Thank you. ... Yeah. Thank you. It's Sandra from Octavian. I have a follow-up question on the Audéo Infinio. So how does this look like in terms of speech intelligibility compared to competitors? You showed some very nice data on slide 59, where you compare Audéo Sphere with competitors. Where on that graphic would the Audéo Infinio end up? So when we measure Lumity against competitors, we can say in terms of speech understanding, with the 6.4 dB that we showed there, we are. I would say in a humble way, we are certainly on par. We are leading in some dimensions compared to competitors. And so the Infinio, in terms of the speech understanding, has not been a major step forward. The major steps were really on sound quality. But sometimes it's also difficult to separate what's speech understanding and noise versus sound quality. So we have people who have been wearing Sphere, and they come back, and they're really, really excited, and they describe, for example, "Well, I can hear now if someone is walking behind me. I couldn't hear that before." That's not the Sphere, that's Infinio. There's a lot of little nuances that the Infinio has improved in terms of sound performance that is not related to the Sphere. The Sphere is really on top of that. But I think it's fair to say if we would have only shown you today Infinio and would have shown the data, it would be ahead of others in the sound performance, and at the first time, fit probably equal to the best or slightly better. Yeah. So it, it would be similar to a launch as you would have probably put in the Paradise or so, just from the lift you got. It was a full project with, with everything we can optimize on the different elements. We had two different teams. Daniel Jelovcan, at ZKB. First question about the chipset size. I mean, your old one was 65 nanometers, I think. I mean, does it really matter? Or, I mean, your pieces were mostly around 25, 28, to my knowledge. So where are you now with Era? The first question. So the Era, I think, is on 65. Forty. 40, excuse me, and on the Deep Sonic, we are on 16. But I think your question is the right: Does it really matter? I think when we looked at energy consumption, the power management, battery consumption, at the end of the day, reduction in size, reduction in nanometers obviously helps a lot to also reduce that. So the energy efficiency is greater if you have smaller nanometers. It's also a reduction in size physically, but it also unlocks power efficiency improvements. Yeah, you have another benefit, which plays out there when you look at the different node sizes. If you have a lot of AI to do, you're better off at that level. If you don't have unlimited capacity, then it wouldn't matter anymore. But if you're at that level where you're kind of at the cusp, you wanna have dedicated AI because there is different architectural ways to how you put your transistors together and whatever else. So I think there's an incremental boost in there because it's a dedicated AI chip, even if the node size is sixteen. And maybe if I can just add, I think on the Deep Sonic, it's the size reduction and all the neural connections and all that, but it's also really the chip architecture, which we don't really emphasize enough, I think. But that's really also key to bring this technology to life. And I think we had a thousand different architectures and models tested to get this DNN in a high-performing mode. So there's a lot of work behind the scenes that also really matters. The second question, this connection stability, why is it so much different between Android and iOS? I guess it's because of maybe limitation of Apple or I don't know. We have tested with the Androids, and on the Androids, I think most of them were running on Bluetooth LE or on the ASHA protocol. The protocols are different between the Android implementation. If you also look at the level of compatibility that hearing aids have with Android phones, if you don't have the Bluetooth Classic, the universal connectivity as we have, you're limited in terms of what phones you're compatible with. There's different protocols to the question you asked, which also has a different performance. On the Apples, it's the MFi. There's a different protocol and has different pros and cons. With the Bluetooth Classic, with our proprietary implementation, we are... Thanks to six times more transmission power, we're now even getting it to a more stable and more easy-to-use connectivity than before. All right, Steven Sanders, Sanders Capital. It strikes me once in a long while, you have a chance to really create a patent barrier, not just a CMOS barrier, not just a CapEx barrier. In this particular technology, you've innovated at the DNN architectural level. You've innovated at the silicon level tied to that, right? You have this audio quality estimator, DNN, on top of that, which is quite a powerful piece of work. So are we underestimating the degree to which there is a patent barrier that can be assembled in addition to the six years of R&D? The second piece is on comfort, which is an important, you know, metric for Sphere. Clearly, we've done some studies. We've tried to see, can we really discern a difference? Does it matter to the consumer? To what degree can we feel confident that the comfort is something that people will say, "Gee, the trade-off is worth it, that I feel good about it? I think you can take a look at our publications, and you can see where our IP portfolio is. There's also things that you also don't put under intellectual property protection, right, and you keep proprietary, and we've done a combination of both of those, is how I would frame it. You want to take the second question? No- You're talking about sound quality. Yeah. That's what your question is specifically on first-fit performance. Ollie, do you want to take- Yeah, I want to- since you have the data on it? Sorry, can you repeat the question? Yeah, it was on both comfort for sound fit- Yeah. but also on comfort in terms of the actual coupling against Yeah the ear mechanically, because this is a heavier device. Yeah. So, to what degree do we feel that we've surmounted that? The trade-off is tracked? Yeah. So the comfort more on the physical side, I mean, we have tested this product with a lot of consumers. We have a lot of clinical data, and quite honestly, we have not come across any objection in terms of it's not comfortable. If you look at it on the table or in your hands, it is bigger. You will be able to see it afterwards as well. But when you put it behind your ears, and I'm wearing it, wearing glasses, I've also tested Sphere many hours in my life over the last twelve months. It's not a noticeable difference. I think it's fair to say the RICs have come to a size where you even get people arguing they're too small, at least for the dexterity. I'm not trying to now sell the larger size, right? But on a RIC, even for the more heavy ones, it... You don't hear comfort. And keep in mind, the BTE is a lot larger, right? So yes, it's larger than the regular RIC, but we wouldn't expect comfort being a topic at all. It, it's really more if somebody from an aesthetics perspective puts them next to each other and say, "Aesthetics are really important to me. What we find, just being very specific, we do customer research, and we do end consumer research. What's really interesting is we find, and maybe it's because as an industry, we've pushed size so much, the hearing care professional cares more about size sometimes than the end consumer, right? Because once you put it on your ear, you're not gonna notice the difference. That hearing care professional, you're gonna do a side-by-side comparison, you say, "Oh..." They're gonna push the smaller size. There is some initial. You can look at YouTube, you can see what people are saying about it after the initial launch. At least in the US, it seems to be less of a concern than we anticipated, so. We have time for probably one or two more questions, if there are any, or if you're all very hungry, then we'll start a little early. Any last questions? I would encourage you, when you have a chance, to do the listening demo. It's very obvious, we have a lot of data and whatever. We have a saying here which says, "Hearing is believing." So we have it for you if you find the time. It's more impressive than what we can be, we were able to show on the screen, so take advantage of that. Thank you, everyone. Thank you, and for those on the webcast, we will be back at 2:45 P.M. You did a great job. ... Hello, good afternoon, and welcome to the second part of our Capital Markets Day. So I hope that you had a really great lunch, and that you were able to experience the product demo and also talk to our experts. If you haven't done so, and you are not going on the factory tour, you still have the chance to experience the product demo after these presentations. So now it's my pleasure to introduce Oliver Lux to you. He is our Global Vice President for Audiological Care. And then after we will continue with the Sonova X Business Systems and all the benefits that this program or this actually generates for Sonova, and that will be presented by Lilika Beck, who is our new Global Vice President for the Consumer Hearing Business, and together with Arnd and also Ludger Althoff, they will give great insights in what we have to show you. Okay, so Oliver, the floor is yours. Only this. Thank you, Birgit. Welcome everybody back from the lunch break, also from my end. I hope you had the chance to really try out our new product range and I hope the spark will also landed on your side, exciting you to see what upsides we are able to provide to our customers. Over the next half hour or so, I will share three topics with you. We will dive a bit into the global audiological care strategy and recap on this. We will dive into the German market and see what we did there over the last couple of years to win a market leadership position, and then distill out of that a bit what we learned for the global business of audiological care. Before I dive into content, allow me to briefly introduce myself as I'm in this new role for the first time with you. Birgit said it already. I'm the new Global Vice President for the Global Audiological Care Business of Sonova. I started in that role about three months ago, taking over from Christophe Fond. I have been with Sonova for around thirteen years in different roles and capacities, on global roles such as M&A and strategy, but predominantly over that time in general management positions, leading some of our markets, in Europe, in the US, et cetera, but also in regional management roles, overseeing a couple of markets, also in Europe, in Latin America, but also in Asia Pacific, including China. The last role I had was overseeing our German retail organization under the Geers brand for the last two years before I started in the GVP role about three months ago. That said, let's dive into audiological care. Just to recap who we are: We are running one of the largest networks in our industry, about three thousand seven hundred stores, a bit north of this, with ten and a half thousand highly skilled individuals, about eight thousand of which are working on store level, and more than six thousand of which are audiologists and hearing healthcare professionals, what we call HCPs. We are operating in twenty markets across the globe, and we are providing in all those markets, best-in-class services and expertise with the technologically most advanced products, such as the ones that you saw this morning. We are running different brands across markets that we are increasingly harmonizing in terms of positioning, but also in terms of brand alignment. We are growing the network through organic growth, including greenfield openings, but also selected M&A. If we're looking a bit into the trends of the hearing healthcare market, and if we look into the customers, then we can see two things. On one hand, there is a growing number of individuals growing into our cohort out of demographics. You know, in most of the industrial markets, about a third of the population in a couple of years will be sixty plus. And those individuals, the baby boomers, senior citizens, they come into our cohort of potential customers with a different backgrounds. They are more savvy in digital. They are active on social media. There is an active lifestyle and well-being, and healthcare is a very important topic in those individuals' lives. This leads to an opportunity to differentiate in the marketplace through medicalized services and offers around medicalized products for that cohort. Cost-effective marketing and lead generation becomes a very competitive field and a very important driver of competitiveness in our field with that new target group, and retail brand awareness is increasingly important, and there is a third component to the hearing care trends, which is the hearing healthcare providers. Engaged audiologists, that's one of the key components to grow our business. They are a scarce resource in almost all of the markets. We have a lack of educated HCPs. So one of the key components of the key competitive factors in our industry is to attract the best talent in the marketplace, but also to train, to educate, and to retain those individuals amongst the workforce. Now, how does that land in our strategy? On top, we are focusing on what we call Pinnacle Audiology. Pinnacle audiology is what we understand by providing the best personalized audiology solutions for every single customer in every single market across our network. And personalized audiological solutions, that means the best product, the latest innovation, but also personalized services, the customer process. By that, we are also working on providing easy and convenient access to our customers. That means that it's on the customer to choose when and where, by whom, and how they're getting in touch with us, and how they are consuming our services and products, either on the store level or via omni-channel touchpoints, which means online or via the app, via social media, or a combination of all that. And the third component is a relentless execution of what we call Sonova X. It's the continuous process of process improvement, of continuous improvement, of structural improvement, of everything we do in order to get better every day and in order also to create some headroom on our P&L for future investments into our business model and for our customers. Now, let's look a bit into Germany and what we have been doing there. To start with, let's have a look at the market. Germany is one of the largest markets in our industry. It's one of the two largest markets in terms of volume in Europe. It's a highly regulated and reimbursed market. About 60% of the market is fully reimbursed products, the so-called Nulltarif-Produkte. And with that, the average selling price is also a little lower than we would see in comparative markets. The market is growing by 2% to 5% historically. You saw the outlook earlier, by Birgit, today. And there is competitive pressure in the market, both from local competitors, as well as from our, global competitors, that are all active in the market, and competing for the ever same customer base. What we're also seeing in Germany, or have been seeing in Germany over the last couple of years, is a somewhat moderate consumer confidence when it comes to end consumer products and services. Now, how did we navigate in that market over the last couple of years to win a leading position? We entered that market over time by a string of acquisitions. After we acquired AudioNova, and part of the AudioNova acquisition in 2016 was also acquiring Geers in Germany, we ended up in a situation with 17 different brands across the market, with various headquarter organizations and offices, and that's simply not manageable. It's not effective, it's not efficient. At the time, we decided to merge everything into one organization, to create economies of scope, and out of that, realize economies of scale by having everything under one roof and build one brand in Germany for our audiological care business. We selected the Geers brand at the time because it was the most renowned brand, a brand that came in via the Sonova, via the AudioNova acquisition in 2016, and we also merged the teams or brought together the teams under the roof of, the former Geers headquarters in the city of Dortmund. Leveraging economies of scale into one brand frees up capacity. It frees up funds that you can reinvest into marketing and winning customers and creating brand awareness. So it was possible, under one brand, to be above the line, present in the market, on television, on mainstream media, in print, et cetera. And also to collaborate with one of the most renowned personalities, in the German media or German-speaking media world, even with Thomas Gottschalk. That combination, to be continuously online and to be continuously on television and have a collaboration with somebody like Thomas Gottschalk, led over time for Geers to catch up on brand awareness, to catch up also on consumer trust and on aided ad recall, which is a very important thing if you think about lead generation. Now, having established a renowned brand, that's not the end of the story. It's the prerequisite to continuously attract customers into your network. It's also the muscle that you have to build these days around lead generation capabilities, and in that, also about lead generation capabilities around an omni-channel environment. What does that mean? Typically, a hearing healthcare journey for a patient does not start necessarily anymore with a hearing test in a store or with a hearing test with an ENT. Very oftentimes, and we heard the example before from Oliver, people are realizing they don't hear well in a noisy environment. I know it myself, I have a mild hearing loss. It's very difficult to follow a conversation when you're, for example, in a bar or at a dinner conversation. It's very difficult. You have to lean forward, you have to concentrate. It-- you're getting tired. You start to avoid those situations. In the beginning, you don't even know necessarily that you have a hearing loss. You just feel uncomfortable in that situation. Over time, you find out, and the triggering event can be what we call a relevant other, a friend, a spouse, a family member that is pointing out maybe it's something wrong with your hearing. Maybe you find out yourself. Maybe it's an ad that you see somewhere. So the journey might start wherever. It might be that you are coming to a practice of an ENT and to conduct that hearing test. It might be that you are just browsing the web and try to gain much more information online at Google, wherever. It might be that you see an ad of us somewhere on social media, and then you make an online appointment with us to have a hearing test executed in one of our stores. So there's different starting points, and there is different journeys across digital, but also traditional ways of reaching the customer that end up at the store level with an appointment. And in order to bundle the capabilities and in order to muscle up, we created something in Berlin a couple of years ago that we call the Lead Gen Factory. It's an in-house digital platform for online lead generation and qualification, as well as helping us to convert better across the funnel by pre-qualifying people and follow up through the entire sales funnel. This is also helping us to improve cost per leads and the customer lifetime value. And while building up that muscle, we are also working on expanding those capabilities into other markets, not only into Germany. So out of Berlin, where we have a team of around 150 highly skilled people, data architects, data engineers, online marketeers, customer engagement specialists, et cetera. We are rendering those services also into other European markets as well as into the U.S. market, and we are continuing to spread that capability out from Berlin into our network. Now, if you have your brand built and your lead generation capabilities scaled up, people end up in your stores where the hearing healthcare test is executed and where the product is fitted eventually. Now, it's very, very important if you are operating hundreds, if not thousands of stores, that this is a very consistent experience for the customer, and that it's a very consistent experience, not only for that single one customer, but for every customer, every day in every store. Experiencing the delight of hearing is of utmost importance, and we... delight of hearing is of utmost importance and is incredibly crucial, and we decided to wait it out. We developed something also in our store concept, and we developed it out of our World of Hearing flagship store concept, which is the experience room, where also the relevant others, so spouses, friends, et cetera, that might be a facilitator for you to move into really using a hearing solution, can not only see you experience that, but they can also experience the situation, how it feels for somebody impacted with a hearing loss in those situations, suffering from that hearing loss. So also for them, we make it an experience, and that is very, very important also in the social interaction within a family or a social group. To the guests, hard-of-hearing patients suffering from that hearing loss. So also for them, we make it an experience, and that is very, very important, also in the social interaction within a family or a social group. From the company perspective, there is also an upside associated with that because it makes the work across our store network much more plannable. We can manage capacity. Of our store network, we can manage the calendar capacity of our HCPs, which is a scarce resource as we heard, and we make it a scalable process. Around that customer journey, around that in-store processes, we also started to redesign the- ... capacity of our HCPs, which is a scarce resource, as we heard, and we make it a scalable process. Around that customer journey, around that in-store processes, we also started to redesign. After two years in the pilot stores, we're up 10% of the available time for sales appointments, right? You can argue cost, you can argue that's an opportunity from growth because it's a scarce resource. You look on predictability in product launches, the consumer hearing business, now two years with us on their journey, they were always three to four months delayed. Last year, we hit all developments on time. One was a couple of months ahead, you know. If you go to continuous improvement, Ludger, on the manufacturing side, will share the labor productivity on time delivery. We also deployed the working capital, significant improvements in DSO, in particular, payables. You can see in the last three years we've increased our payables, which is a good thing for us, by 75%. And then on the talent side, I said it's partially the training, but it's also partially improvement of the processes in particular in the world. Now, on the flip side, if we have a good lead time and we're sticking to our customer request date, we are driving customer happiness and satisfaction, and therefore, the Net Promoter Score is directly influenced by that one. We reached the improvement so far by, first of all, all our parts which we have, which we are stocking up, where we have our standard parts, by having a plan for every part in terms of stocking model, which is demand and supply, always checking and make sure that we have the right level there and always in our distribution centers, all around the globe. Daily management. Daily management is something you will see later on when... For the ones which have signed up for the factory tour, this is something where we are daily checking on... First of all, over the day, we are checking that we are really fulfilling all the needs which we have for the day, but if we can't make it, the next day, we are checking on why couldn't we, and what do we have to change so that this one is not happening again, and then the optimization of the replenishment. While most of the systems, the computer systems, are based on forecast, whatever forecast is in the system, we say we do an automatic replenishment. Whatever gets sold, get automatically replenished in a so-called Kanban system, in a min-max. I mean, there's a lot of pull systems with which you can think about, so that there's an automatic replenishment behind. Now, let's go to the second example. Second example is productivity. Arnd already talked about the 12%. The 12% is an average, and then we will see it on the next slide, and how it was going on the different years, but the scale has changed over the years as well. How do we do that one versus... Or how could we be able to drive 12% in average productivity? It's really about focusing on the non-value add versus the value add. By the value form model, for example, is something that's really thinking about what can we do on the value add. But the value adds, and there are a lot of statistics out there, is really only 5%-10% of what we are doing in the available hours. The... The 5%-10%. If you improve on the 5%-10%, even 10%, you only have a 1% improvement for the company. There's far more in if you concentrate on the non-value add, and there's two types of non-value add. One is about the necessary. I'll give you an example on the necessary one. That's about the reporting, maintaining a quality management system. That's all stuff which you have to do, but it's not really something which is valued by the customer. The customer really cares about every time you are adding something to the product, then or the service, whatever you or whatever they have ordered. The non-value add, but necessary, we try to minimize and optimize and automate, but there's a lot of stuff, the majority, which is non-value add, which is not really needed. It's like overprocessing, it's waiting for material, it's waiting for tools, it's searching for... It's like searching for documents. There's a lot of stuff which is wasted, where by optimizing walkways, by optimizing the way on how you place the material, on how you place the tools. I mean, by the way, in the office or on the shop floor, it doesn't matter. That's where you get a lot of savings through on the product and a lot of productivity improvements by thinking through the process on what is really necessary and what is not, and how and how do I serve the the this workplace the best. How do I find that all? How do I find the improvement? I go there where the work is happening. We call it go to Gemba. Go to Gemba is wherever the work takes place. Go there, observe, see, ask questions, talk to the individuals and involve them. When you involve them, they come up with a lot of ideas. They tell you, "Well, I don't know why I do it. Can you ask? Can you see who is..." And then if you just stop it, what happens? So it's like a. It's a lot of things which you can do together with the employees, which are working in the process here. And of course, you need to visualize because people don't see it. People don't see it if before you don't put it on the wall, you say, "Well, this is a workflow. This is what we are doing, and why do we do it this way?" And then most of the time people say, "Well, you know, it was always there, this way." I said, "Okay, good. Let's do it in a new way and to see how we can do it smarter?" What has been achieved so far? In the first two years, we really focused on the shop floor. The first year we took some. We took three pilot factories, and from there, in year two, we scaled up and took all the factories, and then we took the next, you know, generation after this one onto adding all the support groups in terms of logistics, in terms of order handling, all the ones which are supporting the manufacturing into scope. Where, and always when we scaled up, we could still drive the same amount, more or less the same amount of improvement on the productivity side. The last one, the last big change was we did not focus so much about driving the amount of Kaizen, of activities, by thinking about what are the ones which we have to drive to have a bigger impact and make. And we need to get more. We have to have more impact in terms of driving the, the sustainment to make sure that it's sustained over time. So I hope I give you. I gave you a little bit of an example and insight on what we did so far in our, so with our Sonova Excellence on the shop floor. From here, I would hand over to my colleague, Lilika, which gives you a little bit of insight on what we did in the AC side. Perfect. Thank you. Thank you, Ludger. Good afternoon, everyone. My name is Lilika Beck. I am the Global Vice President for the Consumer Hearing Business. This is the first time we're meeting, so I thought, like Ludger and Oliver, I would do a little introduction as well. I am just coming up to the first 90 days in this very exciting role and also as a management board member with Sonova. But I've been with Sonova for 15 years, and I started my journey down under in Australia as a commercial director with our brand, Unitron, and then was invited to travel up to what we call the Great North in Canada, and lead the global Unitron business as their VP of Marketing. And it was in this role I had a very cool opportunity to lead a group of product managers and developers and work very closely with the R&D team in creating our product portfolio and innovation. So when you saw that sparkle in Oliver Frank's eyes when he talks about innovation, that's exactly what we were doing there, building the Unitron innovation. After that, I moved to the audiological care business in Canada. We operate there under the brand name Connect Hearing, and this gave me the opportunity to see how the innovation we had been creating is now being experienced by people with hearing loss every single day. That's a daily business. We diagnose, treat hearing loss, and provide solutions. So I spent four years there, and that's actually where my exposure to Sonova X and my experience with Sonova X grew exponentially. I'd like to take you through an example of how we use Sonova X at Connect Hearing, to unlock value in the business, to improve productivity, and honestly, to resolve one of the biggest challenges we faced in that business. Firstly, before I get there, just a little bit about Connect Hearing in Canada, because it's not a business that gets profiled a lot, but thank you for sharing the data earlier around the market growth. We have 175 clinics there across the country, and we're among the top three providers of audiological care services. It's a good quality, mid-size market, about 650,000 hearing instruments per year, and a healthy growth rate of somewhere between 3.5% and 4%. More recently, I can see mid- to high-single digits. We have, comparatively to other markets, a good hearing aid penetration rate, partially because a lot of our, a lot of people with hearing loss can access some level of reimbursement there, and it's highly regulated, both by region and by profession. So whether you're an audiologist or a hearing instrument specialist, and in, depending on which province or state you're in, you belong to a different regulatory body. Now, here comes one of the biggest challenges we had in that market, and it's actually something Oliver spoke to. He called it audiologist scarcity. In Canada, we have 100, approximately 120 hearing care professionals graduate each year. That's a lower number than the number retiring, and every year, that's declining, those number of graduates. So our clinical capacity to serve consumers in this growing market is becoming a challenge. And we do a lot of the good things that Oliver talked about, supporting and certifying people to go through the program. We have good recruitment and competitive recruitment policies. We leverage immigration as well, and of course, retention is key. But nevertheless, we started to get very, very curious about how we manage the capacity we have in our clinics. Are we doing that well? Is it optimized? So to understand that and unlock any value there, we used Sonova X. And there were three things that we did. I like things in threes, they're easy to remember. The first is we deployed or completed a Kaizen. Ludger or Arm took you through what a Kaizen is, a cross-functional Kaizen, where we invited team members from across the business, particularly those at Gemba, so the frontline, the hearing care professionals, the admin staff. And what we learned at that Kaizen is our clinic calendars, although they look similar across the clinics in terms of the type of activities, there was actually a very low level of standardized work. Every clinical calendar was very customized to the way that hearing care professional liked to work, their style of working, their appointment lengths, the type of appointments they wanna have. And as a consequence, it was also very reliant on their ability or capability on how to manage their time effectively. So one of the key outcomes was to create a standardized calendar. Now, what does standardized mean? It certainly doesn't mean one size fits all. I respect the different profiles of people and hearing care professionals we have. So we did a level of segmentation, and if you think about it, you've got hearing care professionals who are graduates, who need more time for a hearing test, and then you've got those who are very tenured, maybe running an established clinic, who can diagnose and prescribe within sixty minutes. So we created four different calendar templates and deployed them. After deploying this, we needed to empower our teams with a way to manage what we've deployed, to measure themselves against their goals. So we gave our clinical teams and their managers a daily dashboard, where they could see how time was being used across different clinics and different regions. And this really informed some very good quality business decisions, particularly around workforce planning. Do I need to amp up capacity here? Does this clinic maybe need to go part-time over a period of time? So, the managers now were empowered to use this data to make business decisions. And finally, there was. This data was very useful for our marketing team, and this was the first time this had happened at Audiological Care. So our marketing team could now see in real time which clinics had free capacity, and in a country like Canada, where a lot of our leads come through digital marketing, they were able to power up their investment or power down by region, in order to drive leads where we had capacity. So this standardized calendar management really was an enabler for growth. Now, outside of understanding how do we use our time and use it well, we also were very interested in acquiring capacity. In Canada, M&A is a big part of the strategy for many good reasons, including a large footprint of independent but maturing clinics. But we also know when you acquire a clinic, you acquire a customer database, and you acquire a trained hearing care professional, and in this market, that was very, very important or is very important. So just a little highlight around our M&A, particularly in a city called Toronto. The project was called Project Raptor, which at the time, if you're a basketball fan, was named after the basketball team who had just won the NBA. And Toronto is a very interesting region because it has good population growth, above average selling prices, and is a pretty competitive market in terms of recruitment. So together, that focus on how do we optimize our time, how do we acquire capacity, contributed to a pretty good picture over the four years that I was there at Connect Hearing. We grew our market share to 10%. We had best-in-class capacity management amongst Audiological Care. Oliver will, I'm sure, back me up when he looks at the list. Canada was right up there with how we optimized our time in clinic. Our average selling price grew at a 4% CAGR, and importantly, we had a lot of focus on retention and engagement of our team members, so our voluntary turnover came down to a very low 4%. Super important for us to be able to serve our consumers and our people with hearing loss, and very important to me, because as you know, people with hearing loss take a number of years to make the decision to see someone about it, and ultimately, we were extending that by 20-25 days by not having the right capability, capacity in clinic to serve them. So, what's next? This work then went into a couple of other markets, including Belgium and the Netherlands, with very good results, and continues to expand across audiological care. Thank you so much. Arnd? Thank you, Lilika. I have two takeaway charts while I'll ask Lilika, Oliver, and Ludger to come for the Q&A. So just briefly on the Sonova X, I hope it was worthwhile to go thirty minutes deeper. I'll apologize for the one who wasn't that interesting, but I wanted to share it once while we always talk about it. But it's clearly broader distributed by now in the different businesses and the major functions. Ludger said it, it's at the end, it's the enablement of the people, it's the culture, it's the knowledge on how you improve your processes, and then the commitment to go do it with the time you have to allocate. We made good progress on many different fronts. There's other areas where we haven't even started. The good news about continuous improvement, it never ends. So in that regard, I would say there's also enormous potential. I'll flip up the key takeaways for today before we go to the question, because it may trigger the one other question on your mind. I think we talked at the front around implementing the strategy to drive profitable growth, being on the journey. Particular focus is obviously coming from the lead innovation side, where a company which tries to bring the breakthroughs when they're required for the industry and the customer, real-time AI being, for us, the big next thing, and not just for this launch, but for the years to come as a platform technology. The broadest launch, as you could tell from the images, also a big, let's say, signal into the marketplace from the launch activities. And then the deeper dive on the consumer access, as well as the Sonova X. With that, I want to lead over to the Q&A for the second half of the day, but also other ones which are still open from the beginning of today. So, we start the second Q&A session while we wait for a few people on the phone, and for those of you who are joining the webcast and want to ask a question over the phone, please dial in now. But I would suggest we start with one or two questions from the room before we move to the phone. Oliver. Thank you. It's Graham Doyle from UBS. Just again, on the manufacturing, and obviously relates to a lot of the work you're doing here. As you scale, where do you think you are now in terms of your ability to meet demand for the next year, given presumably you can meet the demand that's in your implied guidance for both products, Infinio and Infinio Sphere? And again, just to understand, how difficult or not is it to produce the Infinio Sphere relative to the Infinio with the extra chip, just to contextualize that for us? Well... Can you hear me? Yeah. Yeah. Okay, good. So, the complexity of manufacturing is not very different to the ones which we have before. I mean, there's one step extra which we have to do. I mean, there's more components which have to be added. There's a little bit more work, but it's not that it's a complete new process on how we are manufacturing them. The scaling up is, well, we have room for scaling up, but, I mean, at a certain point when it's exceeding the volumes, then we, of course, have to have a step change and have to do a lot of investment, but that's what we are looking in right now. And it's really dependent on how much is the Infinio versus the Sphere. We said in the beginning, and I mean, we had different assumption that we had some 70% Infinio, 30% Sphere. Now, what we see now with the U.S., it's completely opposite. So that's where we have to flip from one to the other, which is a different, there's a difference in electronics. So one has a one chip more, we can't just shift from one to the other. So there's a little bit of delay, and that's why we are running a little bit behind. But in principle, we have enough capacity right now to fulfill this year for sure. And then I hope there's far more growth coming into next year, and then we think about that one when doing the budget phase and what we have to invest to go forward. So the last sentence is the hope of every operations leader in the world. So that's to translate it on timeline, I think the first couple of weeks are not easy, given the shift mix, mix shifts and also the ramp up. But for the guidance and some on top, we have clear line of sight on the capacity side. We have a few people waiting to ask question over the phone. So, operator, why don't you put in the first question, please? The first question comes from Robert Davies from Morgan Stanley. Please go ahead. Yes, thanks for taking my questions. I had a few. One was just on the slowdown you called out in the managed care segment. I just wondered if you could give us a bit more color in terms of what's going on there, in terms of sort of price and volume dynamics. That was my first one. The second question was on the comments you made in terms of the size issue on the new hearing aid product, and actually, it not really being much of a pushback in the U.S. markets. Which regions or countries do you expect that to be more of a problem? And then the final one was just on that mix issue between the Infinio and the Sphere. How is that... What's the sort of price differential? Just, you don't have to give us the numbers, obviously, but just in terms of sort of magnitude, is it sort of a 10% difference, a 50% difference? Just can you give us some sense of where the two would sit on the value chain? Thank you. So the first question was, I think on the- Managed care. The managed care. Pricing and volume trend. Yeah. I think on the managed care, there's no clear indication why there is some slowdown more than in the private. I would personally believe managed care was very busy to get access to the different Medicare Advantage plans over the last couple of years. If you looked at their growth rates, they were easily in the 15, 20, 25, and for me, that was a signal that they were making the service available to more and more patients who didn't have access yet. And I think we're now getting into the world where most of these managed care Advantage plans, Medicare Advantage plans are penetrated, and then, with it, the curve will become more normal to the regular growth rate. So that. I think that's the magic there. I wouldn't read too much into it from different strategies of different manufacturers. I don't think that moves the needle significantly, there. I think from the size perspective, I think at the end, I think we go currently by what we see out of the ITE market, because we have yet not launched Infinio and Infinio Sphere in Europe. But in general, we know that the ITE penetration in the US, as a percent of the total, is higher, and there's far more people are willing to take an ITE, even if they have a high hearing loss, which then ultimately leads to it being very visible on the ear with a face plate. While in Europe, we see people pushing very hard for smaller devices, and the ones who are severe to profound, at the end, choose to not take an ITE. So this is really a secondary effect. We need to see what that all means, but it would lead to the thesis that you're probably... If there is a pushback, we don't know in Europe on size, or in general, it would be probably more pronounced in Europe versus US. Yeah. I think otherwise, the other one on the pricing differential, we don't give an exact number, but certainly not the second number you were putting out, probably more in the direction of the first number, direction. Keep in mind, this comes on top of the Infinio premium. Thank you. Could I just ask one follow-up just on the Infinio? I wasn't really clear. In terms of the sort of technological differences between that and the Lumity, what are the key kind of USP benefits of that over Lumity? So, from a chip technology, that may have gotten a little lost. It has a complete new chip on the connectivity side, which in combination with the DSP gives a lot of benefits with regard to the more safe connectivity, the larger reach for faster switchover from one to the other mode. I think we've made significant progress on first time fit by optimizing the algorithms further, and so I think I would put it into this: this is similar to an upgrade on capability for the consumer we would have done from Marvel to Paradise, as an example. But there is a new chip technology in there, which I think is the right next step with regard to anything we wanna go do from a connectivity. We also shared it is Auracast ready for the ones who worry about that, you know. We don't worry short term. Longer term, I think it's good to have the technology on board. Mm-hmm. That's great. Thank you. I suggest we take another question from the line then. The next question comes from Veronica Dubajova from Citi. Please go ahead. Excellent. Good afternoon, guys, and thank you for taking my questions. Hope you can hear me okay. I have three as well, please. The first one is just, I'm trying to think a little bit through the positioning of Sphere, Arnd. And is this, you think, a RIC or a BT type of a product? And is it more aimed at the severe, you know, serious, kind of moderate to severe user, or is it more aimed at your mild to moderate? Just, just trying to understand as you kind of think about it, I think it was alluded in the morning session, as you think about kind of what consumer or customer is ideally suited to this product, where do you think that benefit lies, and how broad or narrow is that customer group? That would be my first question. My second question is just maybe a little bit of color on the approach to the launch and some of the follow-on launch activities that you've had. This is obviously the biggest launch I've seen Sonova do in my fifteen years of covering the company. Frankly, it seems like the biggest launch I've seen anyone in the industry do. I just would love to understand kind of your rationale for that, and how is this different, and as you think about the sort of breadth and depth of the launch, does that translate into different ramp-up, into different customer feedback, into more discounting or less discounting as you start selling the product? If you could just talk through that, and I guess very unusually related to that, for you to be running out of product already. I think there was a video earlier this week saying there are some shortages of the Sphere, so would love to get your thoughts on that, and then my final question, and apologies, I know they're all quite long, but my final question is more on Birgit, and your thoughts on the first half versus the second half. spread in terms of profitability, you know, are we looking at forty-five, fifty-five? Are we looking at forty, sixty? Kind of what are your thoughts on how much smaller first half might be this year versus history, given some of the headwinds you mentioned in your prepared remarks? Thank you. Thank you, Veronica, and thanks for jumping in here. I think on the positioning RIC versus BTE, it's clearly a RIC as a form factor, but I think ultimately also from the usage. Keep in mind, we have increased the power of the RIC every time we come out with one, so over time, the RIC takes more and more of the BTE share. Now, between the mild to moderate, to severe to profound, we need to see. Clearly, severe to profound has an overproportional benefit because they struggle in more noisy environments. But on the other hand, even a mild to moderate has the interest to, A, understand pristine. They also struggle in noisy environment, only not just that much. And then, last but not least, I think the matter of fatigue is also an important one. So I think probably skewed a little bit more to the severe to profound, but I would not be surprised if we see also lots of mild to moderates picking up the Sphere. On the launch strategy here with regard to the events we've chosen and what follows afterwards, I think when we were sitting there and saying, we wanna reach many people to convince them, not just on the loyal side, but even on the competitive side, having a strong starting point with a very strong positive reiteration of our messages in the audiology environment, that's helpful. I would say we also felt in the Lumity, and you heard us say that over the last year, we were a little bit too much in the stealth environment, so we're pushing in the other direction. I think it's also credit to just the sheer size of difference I think we're making, and then I think people do recognize your marketing efforts to a degree, support your claims. Some people go the other way around. We are not that kind of a people, so we think it's really making that clear and loud. On the follow-up, I think in Europe we have events. They're also larger than our normal set of events, but probably not by the factor of five with the participants as we had in the Sphere. Keep in mind, when you choose Sphere, you better use it, right? There's a fixed cost component to the discussion, right? But in all other places, I think we have very significant launch events, and then we have to do what we always have to do. We have to visit all of the customers who were not at the event, because very few audiologists just buy different product on word of mouth. They wanna have it on the ear, right? So at the end of the day, yes, we kickstart the curve. We get a little bit more orders at the beginning, but I think what we're aiming for is a wider, faster recognition, more of a word of mouth amongst the audiologists, and at the end, with that, driving the whole curve up. Yeah. On the availability side, I think it's less a component question at this stage. I think it's what mix, what colors. There's a couple of the challenges we have with some changing in patterns and then needing to go back to customers on what we had in the original batch manufactured. And so I would put it right now more in the order handling. We think we will get through that in a matter of weeks. It's not a fundamental availability issue at the current level, even if we're higher than we thought, relative to our at least initial plan. But it, but it's really when the mixes change significantly, you have to kind of skew the customer to where you have built the first product and other people holding back until they kind of can get what they wanted. I think the third one was on the- First half. First half, second half. I'm looking to Birgit because, but I think your question was on revenue, or? More on profit. More profit. Birgit gets the microphone. She will... Hi. Hi, Veronica. As we already mentioned earlier, the first half has a different profile versus the second half. We said that already at our year-end results. Then, this first half, what we see is, of course, much higher launch costs, marketing expenses, et cetera, but also late-cycle ASP. Now with the initial success of the new launches, I mean, there is even more kind of weighting, so and also more pressure on that front. Then we also have the ramp up on the production costs, et cetera, also related to the success of the new launches. I mean, that's actually the same as what we said before, and then, I guess, Veronica, you can do the math, that there is a significant difference first half, second half. Thank you. I would suggest we take one more question from the call and then go back to the room. The next question comes from Nils Leth from Carnegie. Please go ahead. Good afternoon. Thank you for taking my question. A question for Oliver. Looking at your audiological care business. You talk about how you restructured the German business and went down to one brand. ... How about the big U.S. market, where you are running many different brands? And then just a follow-up to Arnd on the Infinio Sphere. I didn't really understand or get your answer as to if the Sphere version is available in managed care. Thank you. Am I switched on? Should be on. Can you hear me? Okay. Thank you for the question. It's a very good question, actually, and the situation is a bit comparable to where we were in Germany a couple of years back. Due to also a string of acquisitions that we did in the U.S. over the last couple of years, we even ended up with more brands compared to what I showed you, earlier today, but we're also further down on the learning curve out of what I just showed you earlier today. So the process that we're in the U.S. is actually to learn from those experiences, and we are aligning brand also in the U.S. under one brand. The U.S. business will be called AudioNova. That's the brand that we are using for all the markets where we do not have a very strong brand recognition already in the marketplace. And this will also come with, of course, an executional timeline in the remaining rest of this fiscal year and into the next fiscal year. We started to pilot that in 16 stores already. After the summer break, we will follow through into the rest of the organization. And on the managed care- Arnd, do I understand? Go ahead. So do I understand you correctly, that all US stores will be rebranded to AudioNova in this fiscal year? In this remaining fiscal year, we will start that exercise, and that will, most likely go in terms of timeline into the next fiscal year. But yes, eventually, they will all be called AudioNova. Great, thank you. Yeah, and I think the speed you need to balance with the CapEx investment, and because you have to renew stores either way, we don't necessarily do that in a big bang, but we really do that over a certain period of time, and start with the stores who need the most uplift. On the Infinio Sphere with regard to managed care, and what I said is, it's not as black and white as are you in managed care, yes, no? I think, by the way, managed care is not one thing. I think if you go to the different contracts, some people are very high in what they pay for hearing aids and the fitting fee, and that's normally the private pay, insured people and an audiologist, and we make normal money there, right? And then, there's other very skinny contracts, right? Now, it's not on us to decide in which contract this shows up. I think it's on the other side. By the way, it's also very different by managed care providers, so you may see us being in some more than in others. At the end of today, we provide product at a certain price. And yes, as you heard us say, we think the Sphere should have a premium over the Infinio, and then ultimately, they need to make sense. Does it make sense in their particular type of contract, yes, no? But in that regard, yes, there will be Sphere in certain managed care contracts, but most likely not in all. Okay, I want to give a chance- Okay, great. Thank you. Let's give a chance for the people in the room, since we only have about five minutes left. Great. Thanks for taking my question. One, Arnd, you've been talking about the AC business. You've highlighted what you're doing, you know, improvements, but you've also highlighted the issue that you're having with the staff shortages and something that is unlikely to improve significantly. So I was trying to understand, how do we square your investments into AC acquisitions with the fact that it's not gonna get easier to get people to work for you? So are you working on more remote fitting solutions? Is that what, you know, what ultimately the plan is gonna be when there is a more pronounced shortage in staff, or how are you thinking about that? Thank you. So I don't think remote's the answer, because the remote pickup rate, based on the consumer interest, still below 5%, so hasn't changed a lot. Yes, some of the audiologists like it more. In New Zealand, we make better experiences because we can't even staff the store, which is more remote. But the remote is really not what the consumer actually prefers, and ultimately, we have to serve the consumer. The two answers is, A, when we talked about process improvement to improve the number of visits I can manage and higher conversion rate. The other one is what Oliver had on the chart. You did see the Geers Academy, what he had on the bottom. We train by now 500 people a year. If you would go back five years ago, it was probably 200 or 150. I think the answer at the end for us, as well as other scaled retailers, is you need to train yourself, as some market participants would do. A Fielmann or a Costco train their hearing care professionals, right? And I think it's on us to figure out what's the right number versus the productivity we can achieve. But training ourselves has many advantages. One of them is they're more loyal, staying longer with you. They're trained to the model you have, right? In that regard, if you look at a great retailer, at the end, they train from within, and that's the journey we're on. We have to scale it up. Okay. Julien Ouaddour from BofA again. Two questions. The first one on phasing, if I'm correct, Arnd, at the full year results, you said that the hearing instrument could see a sort of high single digit sequential acceleration in terms of sales with product launch between H one and H two. Does market softness in Q1, higher adoption of Sphere versus Infinio, are two reasons which can imply an even higher sequential acceleration in H2? I mean, basically, could we see positive growth in H1 for hearing instruments? And the second question, a business we haven't discussed, the consumer hearing. We've seen your Comtech GN like we decided to wind down its consumer business or the Comtech GN trying to find a buyer for the headset business, too. Could it be a potential scenario for Sonova and its consumer hearing business as well? And especially as this business was acquired for OTC, if I'm correct, and we don't really see, I mean, a big traction so far. Between the first and the second half, I think the jury is out with regard to what is the growth in the second half year. We feel good about the sum of the parts towards the guidance, you know? I think, yes, what I said, I think the digit is in the room of possibilities between the difference in growth rates. Could be a little bit above, it could be a little bit below, depending on what the demand on the Sphere. But keep in mind, always relative to we feel good about the guidance for the full year, yeah. So this is no change, despite the somewhat more headwinds in the market in Q1. With regard to the consumer hearing business, we like the business in two ways. We still believe early entry devices, short or long term, are relevant. I do believe that consumers, over time, change behavior, and we do see people who like to self-fit just because that's the right model for them. I think we're all struggling with how do you make that work in today's world with the lead generation cost and return rates, you know? But we're still using our products and testing how we can optimize that. We have certain synergies other people don't have. This is not regard to our hearing care competitors, but at least from a product development, it's pretty much the same product. Yeah. The other one, I think on the Sennheiser side, I think we see the potential we did see two years ago to drive growth and to drive profitability there, to make the asset ultimately more valuable and better performing. Sonova X plays a role. It's unfortunate that the market in the last one or two years was not a friend of ours on the consumer electronics side, but I think that's, relative to market, we're doing fine from a market share gain perspective. For me, that's an important metric, because if that wouldn't be in place, then I would start to worry if we have the right asset. But no change on strategy at this point of time. We have one more question from the phone, and then unfortunately, we will have to stop, so operator, can you give us the last question, please? Dhrubanjoy Dasgupta from HSBC, please go ahead. Hi, thanks for taking my question. So I just have a question on the timeline for the new product launches. So I think initially, the launch for Infinio and Sphere was to be towards the end of August in Europe and APAC market. So with more demand you're seeing in US for these products, so how does the inventory levels look like, and what is the launch timeline in UK and other markets? The launch times for the Infinio Sphere have not significantly changed. Europe in the September, the markets are slightly different. And I think right now we're putting the 70 and the 90 on the Infinio and Sphere out. But in that regard, no change on timing, and we should see the product starting to be available, and that's how also the launch events are lined up in the September timeframe in Europe, which includes the UK. So with this, we conclude the Q&A session. Arnd, do you wanna have any closing words? Thank you for coming. I could sense some excitement on the excitement we have, so I hope we did a good job also explaining why we're excited. Not just in regard to the words and the videos, but in the facts and the data we were able to share. Hopefully, you had a chance to listen in. I think, as you know, in our industry, many things are important, but innovation is very important. So in that regard, I think we feel we're at a good place. You heard us talk about the H1, H2, but at the end of today, I think we're building an organization with four different businesses. Sonova X helps on the way, and the breakthrough innovation in our most important business will be a good guide for the next couple of years. Thank you for your attention. There is more to do on the way out now with regard to factory tour and more product demos. Otherwise, travel home safely. Thanks for coming.