Ladies and gentlemen, welcome to the SMA Solar Technology AG Financial Results 2025. I'm Moritz, the caller. I would like to remind you that all participants will be in a listen-only mode and the conference is being recorded. The presentation will be followed by a question and answer session. You can register for questions at any time by pressing your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Kaveh Rouhi, CFO. Please go ahead, sir. Thank you, operator, and welcome. We very much appreciate that you're taking the time for this investor and analyst call on our first half-year 2025 results. With me today in the call is my colleague and SMA CEO, Jürgen Reinert. Welcome to the call, Jürgen. This conference call is scheduled for up to 30 minutes and will be recorded. After the management presentation, we will be happy to answer your questions. Today's presentation is available on our Investor Relations website. The presentation will also be available on the website for you. Our agenda for today: First, I will give a review of our first six months' figures, followed by an update on the restructuring and transformation program. Last, we'll have a look at the order backlog as well as our outlook for the year 2025. I expect the presentation part to last about 30 minutes. After the presentation, we are happy to answer your questions. Refer to our disclaimer on page two. To page four, financial highlights for the first half-year 2025. Group sales reached EUR 685 million and were below last year's EUR 759 million in the first half of 2024. In the Large Scale and Project Solutions division, sales improved compared to the previous year. The Home and Business Solutions division declined year on year. Operating EBITDA before one-offs was positive EUR 55 million. Performance in our Large Scale divisions was more than offsetting for low sales and the resulting lower fixed costs regression in the HBS division. Reported group [audio distortion] came in at EUR 9 million after reaching EUR 81 million in Q4. This was mainly due to one-time effects such as write-offs on inventories and provisions for purchase obligations. I will provide more insights on the individual division in a moment. Free cash flow reached about EUR 66 million after - EUR 203 million the year before, mainly resulting from ongoing measures to reduce net working capital, which achieved good results in the first half of 2025. Total order backlog stood at EUR 1 million at the end of June. Now let's go to page five, sales by region and by segment. On the left-hand side, you can see that EMEA is our biggest region with 49% compared to 50% in 2024 due to the soft sales development in HBS, which has the majority of its sales in the EMEA markets. Americas' revenue share decreased from 41% to 33% as H1 2024 was very strong for the Large Scale division, so that there is a decline in H1 2025 despite solid revenues. The APAC shares region increased from 9% to 19%. Here, we are showing very strong development in the Large Scale business again. The main markets for the SMA group in the first half were Germany, U.S., U.K., and Australia. Now let me walk you through the sales per division on the right side of the slide. Sales development in the division Home and Business Solutions was affected by lower demand as well as high competitive and price pressure and therefore decreased by 48% from EUR 223 million in the first half of 2024 to EUR 60 million this year. Home Business contributed EUR 54 million and C&I contributed EUR 62 million in H1 this year. The division's share of total sales came down compared to 29% in the first half of 2024. EMEA remained the biggest region for the division. Large Scale again showed a strong revenue development from EUR 536 million last year to EUR 569 million in the first half of 2025. Compared to last year, where Americas was the strongest region, EMEA was now the strongest region with 41% of the segment sales, slightly higher than the Americas region reaching 37%. Now let me provide you with more information on the profitability. Operating group EBITDA came in with EUR 55 million compared to EUR 62 million in the first six months of last year. Including one-offs, reported group EBITDA reached EUR 9 million. As mentioned at the beginning of the presentation, one-offs include write-offs on inventories and provisions for purchase obligations, about EUR 50 million in total, as well as provisions for doubtful receivables of EUR 7.5 million due to the insolvency filing of a customer in the U.S. These one-time effects significantly impacted our H1 results this year. In addition, please note that this year's EBITDA includes a positive one-time effect from a claim settlement of EUR 10 million, while last year's results included a positive one-time effect on the sale of SMA's Elexon signals for EUR 2 million. If you exclude all these effects, our operating EBITDA was very solid with EUR 55 million in H1 of this year and reflects the positive contributions from savings related. EBITDA margin reached 1.3% compared to 10.6% in the first half last year. If we exclude the noted one-time effects, our operating margin of EBITDA was about 8%. With about EUR 28 million, depreciation in the first six months was slightly above the level of last year with EUR 24 million. Now let's have a look at the segments in detail. This Large Scale segment again showed an earnings improvement in EUR 113 million compared to EUR 101 million in 2024. Reasons were the higher level of sales and fixed cost degression. Factors that contributed to this included increasing revenue, especially in the field of battery storage projects, the profitable product mix, and the reversal of provisions for legal disputes in connection with a settlement of an O&M across Americas in the mid-single digits million euro range. On the other hand, inventory provisions of EUR 1.1 million had an adverse effect on profitability. EBIT for HBS amounted to -EUR 129 million compared to -EUR 67 million in the first half of 2024 due to the price and volume-related sales decline, as well as the one-off effects from inventory provisions of about EUR 47 million. Excluding the one-offs, HBS's profitability was approximately EUR 10 million below last year's level, despite more than EUR 100 million less sales. Hence, the saving efforts are contributing strongly here, but the market terms and related one-time effects were too significant to compensate for. If the business prospects for HBS deteriorate further in the course of the current fiscal year, additional write-offs on inventories may be necessary. The overall reported EBIT margin here for the SMA Group amounted to - 3% compared to 7% last year. Now I will move on to the balance sheet and net working capital on the next slide. Net working capital, which is shown on the left of the page, decreased to EUR 283 million compared to the 2024 year-end figure of EUR 473 million. This leads to a net working capital ratio of 9%, which is significantly improved compared to the ratio at the end of last year, but also includes a reduction related to inventory provisions and write-down of receivables already mentioned. Let me explain the net working capital. At the end of the first half year, we're at EUR 530 million compared to EUR 564 million at the end of 2024. The decrease is related to the inventory write-downs of EUR 47 million, as well as an additional decrease of physical inventories in our HBS divisions of EUR 50 million, which was offset by a buildup of inventories of EUR 67 million related to projects in our Large Scale division. Trade receivables decreased as a result of lower revenues compared to Q4 2024, as well as ongoing measures to ensure timely customer payments and reduction of overdue payments and the one-time effects from a provision for doubtful receivables. Trade payables increased in the first half of this year, mainly related to timing of supplier payments. Advance payments received from our customers slightly increased since the end of 2023, in line with our solid large-scale project pipeline. Net cash increased by over EUR 50 million- EUR 135 million at the end of H1, mainly driven by the net working capital improvement I just explained. The most significant improvements on inventory management and accounts receivable collection have already been achieved in H1. However, our liquidity protection measures remain ongoing. For example, we carefully review and analyze any inflow of inventories. Now let's have a look at the group balance sheet on the right side of this page, and as I've already explained, the changes in the net working capital positions. I will now focus on the major changes in the other balance sheet positions. As I just explained the change in net cash, I will start with the changes in total cash and financing liabilities. As we need to ensure that we have sufficient cash for our business operations, we continue to use our revolving credit facility with a utilization of about EUR 70 million per end of June. You will find this under financial liabilities in our balance sheet. Our total cash is hence EUR 205 million at the end of June. Regarding the other balance sheet items, non-current assets have increased as a result of an additional IFRS 16 asset related to our new GIGAWATT FACTORY building lease. Other assets increased to EUR 106 million, mainly explained by IFRS 15 contract assets related to projects in our Altenso business, part of Large Scale division, and receivables from currency derivatives related to our currency hedging positions. Shareholder equity decreased to EUR 505 million at the end of June as a result of the negative result. Provisions decreased to EUR 179 million at the end of H1, mainly driven by a settlement agreement and payments made relative to an exit agreement in our O&M business, as well as initial severance payments as part of our restructuring program. Other liabilities increased to EUR 526 million, mainly related to additional leasing liabilities for the new production facility. This is the corresponding liability to the IFRS 16 asset. That concludes my explanation of the balance sheet. Let's now have a look at our summary of cash flows on the next slide. In the reporting period, our cash flow from operating activities was EUR 90 million as compared to -EUR 174 million in the first half of 2024. The strong turnaround on cash is driven by the significant decrease of net working capital in the first half of this year, as explained earlier. Net CapEx amounted to EUR 24 million in the first half of 2025, below the level of last year, as we are managing our cash spending very closely and currently focusing investments mainly on our new large-scale platform. Considering our cash flows from operating and investing activities in total, our free cash flow was positive with EUR 66 million in the first half of this year and much better compared to last year with -EUR 203 million. Please note that we had cash outflows from the restructuring program in Q2, and further payments will also be made in Q3. Let's move to the next page, order backlog. Looking at the left side of the slide, you see that our order backlog remained on a level of about EUR 1.2 billion at the end of June, and product order backlog stood at EUR 848 million. On the right-hand side of the page, you can see that our large-scale product order backlog remains strong with EUR 802 million and HBS with EUR 46 million. For the total group in total, order intake in Q2 for the Home and Business Solutions division was on the same level like Q1, while order intake for the Large Scale and Project Solutions division was lower than the last quarters due to the uncertainties from the OBBB and U.S. tariff situation. I would now like to hand over to Jürgen, who will briefly give an update on our restructuring and transformation program, as well as new products and solutions. Thanks, Kaveh. As you know, we have defined an ambitious cost-saving target with an EBIT improvement of EUR 150-EUR 200 million. We are well on track to achieve more than half of our original EBIT improvement ambition already this year, which is above our plan. The cost savings at the end of June resulting from our key measures for decreasing material costs and operational expenditures are better than originally planned. The savings for personnel costs, which is the biggest lever, are also well underway. In total, we are confident that we will achieve our ambitious savings target. Go to the next slide. I would like to mention that alongside the successful implementation of our restructuring program, we have during the first half of 2025 also launched new products and solutions to meet evolving customer demands, especially in the field of storage and grid stability. The new Sunny Island X is extremely versatile and ideal for both on-grid and off-grid installations. It allows us to adjust the AC power and battery capacity of the system to meet customer-specific needs. Thanks to the integrated DC-DC converter, the Sunny Island X is compatible with a wide range of batteries, offering great flexibility in energy storage. For large-scale customers, we introduced the Sunny Central Storage UP- S, and this one is featuring silicon carbide MOSFET technology, and it offers superior power conversion efficiency and grid forming capabilities. The silicon carbide technology of the powered silicon buses can switch faster with lower losses than conventional silicon technology. Last but not least, we are continuing to provide solutions that allow seamless integration of renewable energies worldwide, like in Chile, where one of the largest battery storage projects in South America is being built in the Atacama Desert. It complements an existing 220 MW power plant, providing a capacity of 918 MWh battery storage. At the heart of the project are 67 SMA battery systems. These innovative offerings make us look into the future with confidence. This is it from my side, and I'll hand back to you, Kaveh. Thank you, Jürgen. Let's turn to the last page, our guidance for 2025. As already said in our Q1 call in May, the market environment is currently very difficult due to macroeconomic deterioration, the declining expansion rates in the residential and commercial sectors, as well as the increased uncertainties caused by the volatile tariff policy and the potential direct and indirect effects on SMA's business. The so-called One Big Beautiful Bill Act, which was signed on July 1, adds another factor of uncertainty that, in our opinion, will weigh on the prospects of the development of the PV market in the U.S. in the short to mid term. Due to the ongoing planning uncertainty, our guidance does not account for potential financial effects of tariffs and other trade restrictions, as well as the gradual phasing out of tax incentives from the Inflation Reduction Act under the OBBB. For the individual divisions, we expect sales in the Large Scale and Project Solutions division to be slightly above the high level of the previous year. For the Home and Business Solutions division, sales are expected to be well below the previous year's level. Group EBITDA and EBIT will be positively impacted by cost reductions and efficiency improvements as part of the restructuring and transformation program. On the other hand, earnings in Q2 have already been negatively impacted by declining demand, including the EUR 46 million one-offs, mainly from inventory write-downs in the first half and in some cases still existing inventories at distributors and changing customer requirements in the Home and Business Solutions division. Despite these one-time effects, our guidance from May, sales and EBITDA in the lower third of the guidance range of EUR 1,500-EUR 1,650 million and EUR 70 -EUR 110 million is currently still valid. However, if the business outlook for the HBS division continues to deteriorate in the course of the current financial year, additional write-downs and one-off effects could arise. The next few months and the concrete impact of the OBBB will be crucial to assess further developments. Regardless of this, we are currently evaluating various options for action in order to be able to be well prepared and react quickly in the event of a further deterioration in the business development in the HBS division. In particular, further measures and efforts to optimize costs and cost structures are being examined. Last but not least, a note on our upcoming events. The first nine months 2025 financial results will be published on November 13, combined with an analyst and investor call. With this, I conclude the presentation, and we are now happy to take your questions. Thank you again for your interest, and please do not hesitate to contact us with further questions. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to disable the loudspeaker mode while asking a question. In the interest of time, please limit yourself to two questions and then rejoin the queue. Anyone who has a question may press star and one at this time. One moment for the first question, please. The first question comes from Constantin Hesse from Jefferies. Please go ahead. Sorry, I was on mute. Good afternoon. Thank you so much for taking my questions. I'm going to take it one by one. I'm wondering if we could talk a little bit about the dynamics of the different businesses. Specifically talking about Large Scale. It goes without saying that the execution here is going extremely well. Profitability is coming through really strongly. Order intake has of course been quite weak. It's gone weaker again relative to Q1. When we look at the development of that order intake into Q3, into Q4, I'm just trying to have an idea of how the backlog could actually develop until the end of the year. If you believe that the Large Scale business could in fact still be a EUR 1 billion business as we go into 2026 because of the lack of orders potentially in the second half, and if that's the case, how should we think about the profitability of that business once sub a billion? That's my first question. Thanks. Okay, I can take this one. As mentioned in the presentation, the big question is how the U.S. market will react, right? We have seen the high uncertainties in the last months in our order intakes, as you've also observed. I think crucial is what will happen in the next two, three months. What I can give as feedback is that the discussions we have with customers are quite promising. You know there might be a catch-up effect in terms of the safe harbor requirements for the OBBB. Talking to customers, we are quite optimistic that we have a good chance of making up for some of the order intakes we kind of lost against last year. Going into next year, we could be looking at a sales figure of around EUR 1 billion. It's too early now to promise that, let's say. I would like still to be cautious, but I would say the signs are positive. Maybe, Constantin, to just add on that, fully agree with Kaveh, of course, but on the profitability, we can also not give it in full detail, of course, as we move along and looking at the order intake. On the other hand, we now know probably with a little bit higher certainty of the taxes towards the U.S. at least. We are more comfortable now than we might have been just some months ago due to the fact that we then didn't know what is going to happen. Now probably a little bit more security. There might be changes in regard to our investments, et cetera. When it comes to the profitability from the orders we take right now, we are quite confident. That's good. Thanks. Maybe just to push back a little bit, Kaveh, I mean, what kind of an order backlog do you need to have in Large Scale to be comfortable with EUR 1 billion? Because even if I model for another EUR 400 million or even EUR 500 million in order intake in the second half, I don't even get to EUR 700 million in backlog by the end of the year. I wonder, given the timeframe of delivery of these projects, what kind of a backlog would you be comfortable in order to deliver that potential EUR 1 billion in 2026? I think what is important is that the backlog, or let's say the time between order intake and sales, has decreased over the year, over the last year. We're not talking about a 12-month period to convert order intake into net sales. We talk more about six months in the European area, and I would say around six to nine months or nine months in the U.S. business. Even if we don't have a full billion at year end this year, we can still make up for that if we have a strong order intake in Q1. I think that's how I would like to answer the question without committing to a certain figure now. I hope you understand that. No, absolutely. That makes total sense. If we quickly jump over to HBS, it goes without saying the environment here continues to be quite tough. If we look at the current development going forward, is the EUR 150 million-EUR 200 million in savings enough to take you to break even, assuming no improvement in the environment? If we continue to stay at this level of around EUR 300 million in and maybe a little bit below EUR 300 million in revenues, is that level enough to take you to break even, or would you have to take additional action? Yeah, I think this is a totally valid question. As you can imagine, that's something we're analyzing back and forth. In the presentation, I was talking about additional measures that we're preparing in case we see that we don't have an uplift. A EUR 300 million revenue base case is not enough to keep HBS profitable or even break even. We need a higher level. On the other hand, we can still do things in our cost phase. With both things, I would say more improved revenue base, but also even further cost measures that we're currently preparing and looking into, we can then reach break even. That's exactly what we're currently doing. Okay, fair enough. Maybe just lastly on HBS, I mean, obviously it's a bit of a tough one because distributors still have relatively higher inventories. I mean, competition is back quite aggressively. If we look at a potential recovery curve, and I've been trying to speak to some industry experts about this too, it's been hard because apparently there are no European countries currently discussing any kind of potential subsidies. Is there anything that you're seeing that could give you any glimpse of hope of a, even if it's a small recovery in the European market in Home and Business Solutions, or at the moment it's just going to stay as is? Yeah, Constantin, good question. That is really why we, as Kaveh was answering already, will look at both parts. If the revenue does not go up, and as you can imagine right now, if we get an order, we are able to deliver rather quickly, of course. If we don't see it going up substantially, then we will need to go into further cost cutting, which we are preparing, as Kaveh said. You're right. We don't see glimpses right now that are very positive. In fact, if we look at the smaller powers, and you know I've been referring to the Marktstammdatenregister, meaning what is being implemented in Germany, then we see from zero or one to 10 kW that we are nearly on half of the volume implemented in Germany in the first half year of 2025 towards last year's first half year. It's a big decline, and we see that in not only Germany, but also in other countries. Right now, we don't see any real big change in that due to normative changes or changes on subsidies, as you said, etc. What we do see is three things. One is, as you also mentioned, the restocking will continue, and that will put us in a better position. We are, of course, working on new products that we will be releasing. That's the second one. The third one is, if we see changes in the positive direction, that would be more on battery applications and charging applications, but they are not of the same magnitude. This is where we see that we have probably come to the bottom with the number you said, which is not a bad estimation for this year. We would see a smaller increase probably next year, but not a substantial one. That is how we look at it right now. That's why we say we will look at it very carefully in the quarter three months and then decide from there. That sounds good. Thank you so much. The next question comes from Lasse Stüben from Berenberg. Please go ahead. Hi, good afternoon. I just wanted to ask a follow-up on HBS. You mentioned that when you are getting orders, you can deliver very quickly. I'm just a bit curious to know what is pricing like given the environment? I'm guessing it's reasonably poor, but I'm just wondering what is the incremental margin when you are getting those orders in? I guess a bit longer term, is there a point where you potentially reassess your position in the home or the resident commercial markets, just given, as you said, there's not much near-term sort of hope for a recovery? I'm just wondering how you're thinking about how much cost you can really take out before you maybe decide to either divest or do something else with that business. Thank you. Yeah, I mean, if we look at the prices, I think we have to differentiate a bit the different regions, right? If you look at the European markets, I would say the pricing remains very tough. We, of course, with the current product range we have, are more the premium player, so we have higher prices than competition. However, we see that the market volumes are not much sensitive currently, at least to the pricing. That's currently, I think, what we do and what we want to do going forward. That's what I mentioned with the HBS cost structure that we're looking into to make a big step in terms of reducing the pricing that we can offer to customers. We will do things there. However, we will always be the more expensive premium player compared to the others. When it comes to the U.S., I think there the price levels are much different. The profitability is even higher. There we are also pretty much in line with what's happening in the market due to the lack of the Chinese competitors. Maybe to just add a little bit onto that, first looking at Europe or mainly looking at Europe, of course, we do see, if we look at the market, sometimes our products are considerably below our sales price because they are sold from the distribution at a cost reduction or at a price reduction. We have seen over the months to be up to 30% or something. We do tend to see an increase there, meaning that our products are now in average being sold more again at our prices that we delivered them for. The other part is that we do have, of course, differences when it comes to the application. If it's a PV-only product, then typically it's going to be very difficult with the price, especially also due to the fact that the Chinese competition is pushing in quite a lot into Europe, focusing more on Europe instead of the U.S.A. and other markets. As Kaveh said, we are on a comparatively low level and thereby have a customer base, which is continuing to use our products, and thereby we do see a rather stable momentum going forward once this destocking has taken place. Of course, we account for cost reductions every year, price reductions every year, but they are definitely in the single-digit range where we also anticipate it to continue for our base of customers. Of course, not the whole range. We are not in the low-cost niche or low-cost area. Okay, thank you. The next question comes from Jeff Osborne from TD Cowen. Please go ahead. Hey, great. Good afternoon. Just a few on my side. I was wondering on the destocking, if the volumes didn't change in the HBS segment in the second half, how long do you think that would take to have the channel cleared? Yeah, I think destocking is one of my favorite topics. We've been analyzing that as well quite a lot in the last month, looking at the run rates. I think it's fair to say that for certain products, the destocking has happened. There is not much more on stock. Basically, what's on stock now is just the baseline that you need to have to just make sure you have products available on the shelf when you want to distribute to customers. We have products which still have a high stock level. If I want to give you some details here, I think it's fair to say that when it comes to high-end products, to hybrid inverters, when it comes to battery solutions, these kinds of things, they are mostly out of stock, let's say, or destocked. Maybe that's the right word, not out of stock, but destocked. When it comes to smaller units, PV-only units, there the destocking still needs to take place. The main driver now is what is actually the consumption rate on the customer side and not anymore, is that too much on stock. I think if the market would have been on a similar run rate as early 2024 or even mid-2024, we would see much higher sales revenues already. I would say the destocking is not our biggest problem now in HBS. It's more is the sales picking up on it. Got it. Just very quickly on that topic, is it about a 50-50 split of hybrid demand versus PV only for you, just more broadly across Western Europe? I think we see a shift from PV only more to hybrids. Not sure if it's 50-50, but the shift is clear. I think the other topic I just wanted to mention again, I said it in the presentation. When we look at our inventories in HBS, we reduced, if you disregard all the write-downs and write-offs, whatever, we really reduced inventories in our end at about EUR 60 million, right? There you see that there is a product outflow. Got it. Very quickly, if we could switch gears to the U.S., can you quantify the impact of tariffs for you financially? Can you give us an update on any plans potentially to manufacture in the U.S.? Okay, I think that's a tricky one, obviously. Let me start with the easy piece. The easy piece is what did the 10% tariffs do to us? Basically nothing, because when we look at our Large Scale business, we have change of law clauses, and we could pass on for all customers the tariffs one-to-one. The margin that we make now looks a bit worse, but the EBIT is neutral to that because we basically pass it on. That's one effect. When we now talk about 15%, I think we're quite confident that whether it's now 10% or 15% will not make a big difference. This should be okay. The question is more, what happens with Chinese imports and what do the Chinese and the U.S. agree on tariffs? The modules are still imported to a large extent from China. If they are twice as much as expensive, this would obviously hit the project profitability from our project customers' perspective because modules make out around half of the total cost of the construction of the site, right? This is basically where we have still the uncertainty. From the European tariffs part, I think we are okay. What we still do though is that we work with our partners on increasing the local share of our products. The inverters that we currently produce here in Kassel, they will stay here, but the MVPS stations and Schaltanlage. Yeah, the switchgear and the transformer. Exactly, exactly, thanks. For those, we will move to the U.S. with our partners because we buy them, and then we would buy them in the U.S. and integrate them in the U.S. to the full station and then pass it on to our U.S. customers. With that, we would have a much higher share of local content and would reduce the tariff impact even more for our customers from the European. The big interesting part, of course, is the copper and the steel where the tariffs are higher. That's exactly the part where we then have the local content, at least in the next year. Perfect. I appreciate all the detail. Thank you. The next question comes from Guido Hoymann from Metzler. Please go ahead. Yeah, good afternoon, gentlemen. Two questions, please. The first one is actually a follow-up to a previous, I would call it the devil's advocate question. It is, should we actually ask ourselves the question if and whether it still makes sense to hold on to the HBS business? You know, given that it is shrinking that much, it might possibly fall below critical mass or critical size. That's the first one. Last time we discussed how the use of the inverters for batteries is growing and how this business could offset potential slowdowns in PV. The question is, what is the share roughly of battery inverters at group level at SMA? Yeah, Hoymann, two things on that. If I look a little bit longer in history, then we've had the situation quite often in SMA or even in our competition that it was wise to keep onto the different segments or divisions in our case. It's very difficult to predict long-term how it is going in the one or the other direction. We've had times when Large Scale was doing bad and HBS in our current nomenclature was doing very well. We are definitely going in to prepare that we reduce our cost, reduce our focus when it comes to countries, reduce our portfolio in order to focus on where we are earning money. This will continue this year. It might even be increased, as Kaveh pointed out earlier. This is ongoing, and this is what we will continue to do. We think that with an uptake, even a smaller uptake, and with maybe an additional adaptation of our cost structure and our focus areas and markets, we should be in a position then to get it back into a good profitability. I cannot say now when, but that will definitely be our case. If it should then completely differ or develop totally different than what I see right now and what we see right now, of course, we will always have to revisit our thoughts. This is at least for the time we are now, and it's what we are aiming for and where we also think that we're doing good in having at least some diversification within the company and continue to do so. When it comes to the inverters, actually, it's an interesting part because I would think you mainly refer to the big powers. We look at Large Scale and Project Solutions. We are at 50% or more on batteries. For the time being, when it comes to the OBBB, we do see that we have a safe harboring at least for the next 12 months to the middle of next year, and then even beyond that for PV and PV only. We do see that the chances for batteries will be longer. We don't foresee right now that we will reduce the share of battery inverters, rather on the contrary. Also, Europe is starting to focus more on battery applications than on PV-only applications due to the discussions here on Dunkelflaute and what have you, and needing more storage in the entire grid. I wouldn't see anything right now that the inverter part goes down, but rather still in the other direction of that it becomes more and more, and we are above 50% already. Okay. All right. Very clear. Thank you. Next question comes from Anis Zgaya fr om ODDO BHF. Please go ahead. Yes. Good afternoon, and thank you for taking my questions. I have two questions mainly on HBS business. The first one is on the strong sequential improvement in revenue in this business in Q2. I mean, versus Q1. It's almost 41% and around 15% increase in sequential order intakes. My question is, why do you seem to think that things are going to get worse in this segment? My second question is on market share. I just want to, because you spoke about Chinese competition, and my question is, are you losing a lot of market share in Europe to Chinese competition? Thank you. Maybe I'll take the first one on why we think it's worse. I think what we are looking at is the run rate, right? Of course, in Q2, the run rate was much better than in Q1. I think the other colleagues had the right question. Is that run rate enough to become profitable? We would say no, we need this run rate to go up in the next months, but also towards the end, especially the summer peak is for us an important seasonality. If we don't see that coming, this also then, of course, has an impact on the following years because then we have to revisit what is the baseline for our planning for our scenarios going forward. We don't expect the run rate to go down, to be clear, but we are asking ourselves, and I think also the other ones, is the run rate even going further up? That's maybe the answer to your question. The other thing is, are we losing market share in Europe? I think it depends on the countries that you're looking at. If you look at our core market in Germany, I would say we don't see that because the overall market is, as we mentioned, from the customer perspective, is not there, is not picking up. Hence, we more or less kept the market shares stable. If you go to low-cost countries, when you look at, I don't know, Brazil, if you go to the Far East, India, those kind of big markets, which are super price sensitive, I would say there we have lost significantly market share, but not only this year or last year, but over the last years. Yeah, this is roughly, I fully agree with everything that Kaveh said, of course. I think the market share did not drop for us, but that also is due to the fact that there's still some products of ours, as we've mentioned earlier, in the value chain behind us, meaning that we do see what is implemented into the market in Germany or in some other European countries. There we don't see that we lose any market share, rather 2%-3% up. That is partly also a product being sold under our price, as I said earlier. The interesting part will be how it develops once the restocking has taken, has fully come to an end on all products. What will everybody do then on the pricing? As I said earlier, we are not unconfident there that we can increase it again. Right now, the most important question is really what is the market going to do? As I said earlier, the market is still going down if we compare the last six months towards the last six months of the last year. That has to stop. The demand on the market needs to pick up independent of the restocking, et cetera. This is what we are closely monitoring the whole time. Okay, thank you very much. Thank you. We have another question coming from Constantin Hesse from Jefferies. Please go ahead. Thanks. Just a very quick follow-up. On the write-downs commentary, does the market, so in terms of the risk of further write-downs in the second half, do we have to see a worsening, or would stability in the market basically lead to potentially another write-down? First question. Second question, when it comes to the potential rush in demand in the U.S., following the guidance from the Treasury on safe harboring, would it make sense to see a rush into inverters, given that you can deliver so much quicker today and that inverters, I think, make up about 5% of the project cost? I'm just wondering where we could actually see this rush in terms of solar components specifically. Thanks. Those are my two questions. Yeah, let me take the first one again on the write-downs. Yes, we would need to see an uplift to avoid write-downs. Of course, it depends on how big the uplift is or how far it's not coming to then basically calculate potential write-offs, right? It's clear that we need to see that. When it comes to what was your second question? Delivery time. I would say, Constantin, the situation is, as we said earlier, the inverters are produced here. They still today, as I said, the integration and transformer are being localized in the U.S., but that is mainly from the end of this year and beginning of next year. Still today, we do the integration in Europe and then everything is sent. There's still some time left. It depends always on how much the companies who are building the projects have safe harbored on the modules or can get them from the local suppliers in the U.S., which we know, of course, the amount of roughly what is being able to produce in the U.S. Therefore, we did not see the real big uptake. As you've seen in quarter two, there was not the uptake on order intake. As we've also mentioned, now we see very promising discussions, which might lead to a good uptake there. With the timeline I've set with the integration still in Europe, it does take two to three months until everything is over. We do expect that the project implementation would pick up again for the time of next year and the next year. It could start rather soon with order intake uptake and then also with delivery starting maybe more in quarter four in the next year. I hope that answered it roughly. In next year, still the inverters will always come from Europe, but then the integration more and more in the U.S. Understood. Thank you. Just one more side note, Constantin. I think it was the first question of the call. I was still thinking about it when you said that the order backlog of Large Scale is not sufficient to reach the EUR 1 billion next year. When I checked, we had the same time last year, we had more or less the same order backlog in Large Scale. I'm not sure I could follow your analysis, but happy to have a short quick call after that. To me, it looks actually quite good. Yeah, same level as last year, absolutely. You had EUR 800 million in order intake in the second half in Large Scale, which basically hugely increased your backlog towards the end of 2024, right? Which was only EUR 100 million higher than now at year end. Fair enough. We're going to have a chat. Thank you. As a reminder, anyone who wishes to ask a question may press star and one at this time. It seems there are no further questions at this time, so I would now like to turn the conference back over to Kaveh Rouhi for any closing remarks. Thank you all. It's exciting times at SMA. It's interesting times, and it's quite a challenging time, let's say. We do have confidence in all the measures we've taken. At this point, I would just like to thank you for your interest and all the good questions that you raised. Please do not hesitate to contact us in case you have any further questions. Goodbye, and auf Wiedersehen. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.