Good day and thank you for standing by. Welcome to VusionGroup's H1 2025 sales conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, you will need to press one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Olivier Gernandt, VusionGroup's Investor Relations Officer. Please go ahead. Thank you very much, Sandra. Ladies and gentlemen, good afternoon, good morning and welcome to our 2025 first half sales presentation. With me today are Thierry Gadou, our Chairman and Chief Executive Officer, as well as Thierry Lemaitre, our Deputy CEO. Corporate and Finance Thierry Gadou will make some remarks on the Group's business performance and financial performance as well as its full year outlook. After these remarks we will be happy to take your questions. As a reminder, some of the information to be discussed on our call today is forward looking and subject to important risks and uncertainties that could cause actual results to differ materially. For these, I refer you to the Safe Harbor statement included in our press release and on slide three of this presentation. This evening's release was issued a short while ago and is available in French and in English on VusionGroup's website, vusion.com. The slides of this presentation can also be found on our website in the regulated information section. A replay and a transcript will also be available on our website after the call. With this, it is my pleasure to hand you over to Thierry Gadou for his opening remarks. Thank you, Olivier. Good afternoon everyone. Thanks for joining our conference call. Very happy to present our sales figures for the first half. First, in a nutshell, VusionGroup achieved an excellent first semester ahead of our guidance with 50% growth in adjusted sales at EUR 648 million. Order entries for the first half reached EUR 873 million, up 22% versus last year. VAS revenues doubled year on year at EUR 90 million, with strong growth in both recurring and non-recurring VAS. Finally, we reiterate our full year outlook of 40% adjusted sales growth and improved profitability. Let's now go into more detail. The Group's IFRS revenue reached EUR 613 million in the first half and EUR 648 million on an adjusted basis. Both are up 50% compared to H1 2024. This is above the guidance, as I was saying, the guidance communicated during the presentation of the 2024 annual results. By the way, it's also our best semester ever and Q2 our best quarter ever. In terms of geography, growth was driven by the Americas and Asia-Pacific region. In this region, adjusted sales reached EUR 452 million, up 134% compared to H1 2024. This performance was driven by the rapid expansion in the U.S., our first market, and particularly the deployment of Walmart U.S. which is entering an accelerated phase with the ramp up of new capacity. For your information, we passed 1,000 stores now installed and live and fully operational at the end of Q2 in Walmart U.S. The fluctuating tariff situation has not at all slowed down existing rollout plans as was anticipated and mentioned during our previous conference call. Even though we do see a bit of wait and see approach from those retailers who have not yet made decisions about ESLs, this doesn't impact our strong growth forecast for the year. In Europe we achieved adjusted sales of EUR 196 million, down -17.7% compared to first half of 2024. As previously mentioned, despite the sequential growth between Q2 and Q1 of 18% and a two-digit growth in order entries in H1 in Europe, the business in Europe is not yet fully benefiting from the contracts signed over the last six to nine months due to normal manufacturing lead times. Also, the general economic situation is sometimes slowing down retailers' investment decisions. Nevertheless, our backlog and pipeline are strong in the region and we do expect EMEA to return to growth during the course of H2 and beyond, although it is a little later than initially expected. If we now look at order entries, H1 was a very strong semester with new orders increasing by 22% year on year at EUR 873 million over the last 12 months. That represents EUR 1.8 billion, a 56% increase over last year at the same period and this record figure is in large part explained by the recent Walmart contract extension. However, both regions had a double-digit growth rate in H1. In Europe, for instance, we announced several rollout contracts in H1, one of the top U.K. retailers, Co-op, involving the digitization of 2,400 stores, one of the largest Spanish retailers, Eroski, and one of the two largest European pharmacy groups, Dr. Max, after signing Phoenix in 2H2024, actually the first largest European pharmacy group. Pharmaceuticals is really becoming a very significant vertical and many opportunities even beyond ESL in this vertical. We also announced at VivaTech a partnership with Carrefour Group, one of the top retailers in the world, to launch a new generation of connected stores based on EdgeSense, vCloud, VusionOX, and Captana. Carrefour is the first major food retailer in Europe to adopt EdgeSense. These technologies are piloted in a large hypermarket with 7,000 EdgeSense smart rails, 70,000 digital shelf labels, and 500 cameras. Shelf cameras and a new store will be installed soon to test another format in supermarket. The partnership covers multiple performance improvement drivers, perfect merchandising compliance enabled by EdgeSense combined with automated visual shelf monitoring, better on-shelf product availability through automatic stockout detection, automated price and label compliance, precise product geolocation, and mobile navigation to improve customer experience and associate productivity, particularly when the in-store fulfillment of e-commerce order. It's a very large scope of use cases fully leveraging the spectrum of our solutions, a large range of solutions to turn stores into high-value assets. We also have in the Carrefour project in-store retail media together with performance with EdgeSense. Stores are becoming intelligent media platforms capable of interacting with customers in real time during the shopper journey. A lot of VAS in such a partnership. It's a perfect transition to talk about VAS now. Revenue from software services and non-ESL solution reached EUR 90 million in the first six months of the year, up sharply by 105% compared to H1 last year. Both recurring and non-recurring revenues grew strongly, recurring revenues EUR 35 million up 34% year on year driven by our cloud platform and other solutions, and non-recurring revenue strongly increased notably thanks to the good momentum in software sales from our new IoT operating system VusionOX, which we have been mentioning many times over the past 18 months and the revenues are scaling. Our cloud install base for your information doubled in a year between H1 last year and this year from 110 million to 220 million cloud-managed ESLs to date or at the end of June in H1. We have continued also our strategic development to accelerate our VAS business and I want to particularly underline here that we have announced a strategic alliance with NielsenIQ to create value for retailers and brands by combining point of sale, trading data, shelf data, consumer insights to optimize at store level assortment, merchandising, promotion, pricing, supply chain efficiency. This partnership is a major opportunity to accelerate the adoption of Captana through a collaborative model between brands and retailers and to expand internationally. Our data solution through joint solutions with the combined services will soon be available in the U.S. front, Italy first, and then aiming at penetration of further retail markets. We have also accelerated the synergies between our various value-added services entities by creating the Vusion Data Division, which includes Memory, Captana, and Retail Media, which is led by Jerome Hamrit, originally from Memory, and the perfect example of such synergy is the launch of Vusion Live, the combined data analytics and AI layer of the Fusion platform, which brings together for the first time multiple data sets and IoT signals and delivers at the fingertips of store employees and store managers the most important alerts and tasks across many operational dimensions. The first stores are already using this version of Fusion Live and more features will be developed in H2 and will be launched at NRF in January. That's for H1 now. For the rest of the year, our outlook remains unchanged with 40% growth for the full year of 2025 and 100- 200 basis points increase in our EBITDA margin. With an excellent order book and pipeline, and despite a persistently challenging economy and still some uncertainty about the tariff environment, VusionGroup has a strong level of visibility and confidence. We confirm targeting an annual adjusted revenue of EUR 1.4 billion for the year. We confirm our objective to grow value-added services revenue twice faster than the top line at around 80% compared to 2024 with strong growth expected both for recurring and non-recurring value-added services. Finally, we confirm an improvement of our adjusted EBITDA margin by 1 points- 2 points in 2025 and a positive free cash flow generation. VusionGroup's commercial momentum supports the outlook for continued solid growth in 2026 and we will now come back on all this in more detail on September 15 when we publish our full H1 financial results. Also, just to finish, for those who are interested, here are a few major industry events that VusionGroup will be attending in the next few months. There is for the first time NRF Europe in Paris in mid-September and we are the prime sponsor of the event and we showcase all our newest solutions including Vusion Live and later developments on EdgeSense and Captana. The Grocery Shop event in Las Vegas at the end of September. Also, during the summer, we will integrate our new Customer Experience Centers in Cologne, London, and soon in New York. With this, Thierry and I are happy to take questions. Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Please stand by. We will compile the Q&A roster. Thank you. We will now take the first question. One moment, please. We will now take the first question from the line of Ben Thielman from Berenberg. Please go ahead. Yeah. Hey, good evening everybody. This is Ben from Bernberg. Thank you for taking my questions. I would have three if I may. First, one would be on order intake in Q2. H1 orders looked pretty strong year over year. If I carve out Q1, it looks like Q2 orders declined double digit, 23% to be precise, year over year. I was wondering if you could give some color. Was that the challenging environment you are seeing in the U.S.? Was that Europe struggling? Any color on what exactly drove orders in Q2 would be helpful. Thank you. Yes, you're right, the Q2 is less important. When I think we mentioned that the tariff situation indeed is creating a bit of wait and see approach by those who have not launched their rollouts already or at least made their decisions. It's been already quite clear in April that we mentioned that and we see that. I think I repeated that. There is this element in Europe, even though we had double-digit growth in H1, we see also an economic environment where there is a bit of, I would say, investment decisions that can be a bit slowed down. It's not wrong. On the other hand, you have to take into account also the comparable basis because when you manage very, very large contract and they happen with obviously contracts like Walmart creates also comparable basis which are sometimes a bit tricky. In our business I think that looking too carefully at quarter by quarter, when we are making such peaks, sometimes in other entries it can be a bit misleading. I would say it's a kind of balanced answer on we're very confident on the structural potential growth and the growth of the market because the demand is there. I think the market has evolved quite favorably in a sense. At the same time, when you look at very short-term situation, there can be also some slowdown in decision, some wait and see. It happens. Let's keep in mind the comparable basis and let's keep in mind that on the 12 months, which is probably a little more relevant period to assess, you know, we're still 56% growth in other entries. Maybe a follow up on that. Thank you. Thierry, you had roughly EUR 530 million order intake in Q1. Was there somewhat of a front loading in terms of orders in Q1 from Walmart? Last year it was EUR 440 million in Q2. I'm wondering what share roughly. I know you don't report on a customer specific basis, but of the EUR 340 million that we have seen in Q2, were these less Walmart orders that were recognized in Q2 than in Q1 this year? No, there is no front loading at all. The Walmart orders follow the rollout plans and, you know, as soon as the stores are decided and planned and decided individually, there is 4,600 of them. You know that gets in our order entries and it is following the flow. As you know, we had a EUR 1 billion extension contract at the end of December. It is flowing through the year as announced. It is not front loading, but it is true that those are very, very big numbers. Sometimes it creates ups and downs in the numbers and ups and downs on a comparable basis. I think obviously dealing with a retailer of that size is always, let's say, making all the comparisons always a bit difficult. This year there is going to be this additional EUR 1 billion over the year that is going to be booked in the order entry. It is going to be. No, nothing special about that. Again, bear in mind that the market, I sometimes repeat it, we are just talking about the ESL market and I am not even mentioning the VAS market, which has a very strong potential. The market today is about EUR 10 billion. ESL is really the potential target addressable market. We have at best 12% penetration right now. The most advanced region is around 30%- 35% penetration. We think that in the next five years all regions of North America and Europe will probably be between 40% and 50% penetration. That is a market growth anyway that is going to happen. Now the quarterly comparisons are. Not. Always completely relevant in a market like that, especially when you have still very, very large deals and smaller deals. I would focus on the analysis on the structural sort of growth potential. That’s why we are quite, you know, we have strong growth ambitions, and even though there is a short term uncertain environment, especially on areas that is creating some kind of wait and see, at the end of the day we're quite confident on our guidance for the year and our growth for next year. Maybe one follow up if I may, is it fair to assume that as a percentage of group order intake in this quarter that Walmart accounted for roughly the same size with the same share as they accounted for in your Q1 orders? You know, we don't give specific customer numbers, but for sure what you would be able to assess at the end of the year is that out of the total, it will be EUR 1 billion in the total of our order entries, because that list is disclosed. Okay. Maybe one last question and then I go back into the queue on recurring VAS revenues. They seem to be up quite a bit year over year, and you touched on that briefly already in your presentation. I was wondering if you could reconcile a little bit where the EUR 39 million in Q2 were coming from. Q1 was roughly EUR 16 million, which is quite a sequential improvement quarter over quarter. Any color on whether these were one-off effects we shouldn't expect to see coming in Q3 and Q4 as well? Anything on that would be helpful. What do you mean? I'm sorry, I don't really. I think I mentioned that the growth, the growth of our recurring revenues is essentially going with the growth of our installed base of first the cloud platform and then the penetration on a number of VAS solutions. That's the contribution to the increase. It's not necessarily exactly the same pace on a quarterly basis because it depends on the activation of services and the speed at which the stores delivered are installed and activated. There can be some changes, but it's going up rather, you know, gradually. This year it's, I mean, this for the semester, it's 34% in the first quarter. 35%. All this is relatively consistent and we see that continuing as we grow the Vision Cloud revenues and increase the penetration of other services. Sorry, Thierry, I meant the non-recurring VAS, because if I look at Q1 non-recurring, it was at EUR 16 million. If you have EUR 55 million in H1, there must have been a doubling in non-recurring VAS revenues between Q1 this year and Q2 this year. I was wondering where that is coming from. As I said, we have, you know, our new operating system is also scaling. The Bluetooth-based IoT operating system, VusionOX, is scaling. That's something that I wouldn't consider a one-off because it's growing and accelerating. There are, obviously, with the growth of a number of other services, especially other services and managed services, we do have an increase that's going with the top line because there's lots of stores installed. I wouldn't say there is a specific one-off. Again, we are confirming a growth of 80% for the full year, which means that we're anticipating, you know, I think it's quite explicit what we can anticipate based on that for the full, I mean, for the H2. If there was a one-off, we might be expected some kind of decline. We would not confirm our 80% growth for the full year. It basically means if you sell EdgeSense to a client, it means that the electronic shelf labels on the EdgeSense rail, they go into, in terms of revenue recognition, in your electronic shelf labels division. Sure. If you connect those to the cloud, that goes into recurring value-added services revenues. VusionOX, which is EdgeSense specific, would then go into non-recurring value-added services revenues. You got two types of, in IoT world, you've got two types of software. You've got the software that is embedded, the software that is embedded on the solution. It's not necessarily only EdgeSense because if they are using the new Bluetooth protocol, they are also equipped with VusionOX embedded. It's related with the new protocol. It can be either on the standalone ESL too, provided they are the new Bluetooth protocol. You have embedded software and then you have the recurring software on vCloud. Basically, IoT works with embedded software connected to cloud and you've got two components of that. What we are seeing now is a ramp up of our new protocol which drives both recurring revenues on the cloud and one-time software revenues on the embedded software. Okay. You will continue to see this trend as we grow the penetration of Vision Cloud. Okay. Of course, thank you. Thank you. Another question. We will now take the next question from the line of Aurelien Sivignon from Odo BHF. Please go ahead. Hi, good evening and congratulations, Semester. I have only one question. I was just wondering if you could. Provide some color on the EUR 50 million. Bit in H1 versus the EUR 600 million more or less guidance. Would you say this could bring. Some further upside on the full year? On the full year target? Thank you. It could, but we are still in a moment where we have to. You have a number of things that are not stabilized yet. I think of the tariff, I think of the dollar. You always need to be. I think we're confirming our guidance. It doesn't mean that there is no upside. I think we're already very happy to be confident on the 40% growth this year. We're slightly ahead of our guidance for the first half, so we're safe for our guidance. That's already a very comfortable position to be in a market like that. Thank you very much, Sir. Thank you. We will now take the next question from the line of Flavien Bordemont from Bernstein. Please go ahead. Hello gentlemen. I have two questions on my side. The first one being, can you maybe give us a little bit more color on your deal pipeline? What is the current market sentiment and did you see any slight improvements in the U.S.? My second question is on the recurring VAS, is it possible to have some color on your recurring VAS revenue growth excluding what you generated with Walmart? Thank you. Generally speaking, I think the current situation is a bit different from the question of the pipeline. I think the pipeline is quite strong. Again, we are in a situation where we see penetration continue to go up in all our key markets. It will go up. It's a fundamental need. The most advanced markets are only at 30%- 35%. Again, as I mentioned earlier, the U.S. is obviously very, very much below that. There is going to be an acceleration. The pipeline is logically extremely big both in Europe and the U.S. The question is more the timing given the situation. I think we're trying to have an approach which is slightly a bit longer term than your questions. We know there is a big pipeline, we know there is growth ahead. We give, I think, as careful as possible guidance. We are quite confident on the way forward because structurally there is no way retailers are not going to digitize and optimize their stores. They have to for multiple reasons. Right now in the U.S. they are, I think, waiting a little bit to see what's going to be the cost of this technology, given all the situation on tariffs, etc. We're getting, I think, close to the end of the suspense. Right now it has been the situation, a little bit careful. Those who had already launched rollout have certainly not slowed them down because they know for sure the return on investment, etc. They were more in the acceleration than the slowdown. In Europe, there is a bit of carefulness in terms of the decisions and the timing. The pipeline is big. I think we said the order entries have been growing two digit. We see a rebound. There was essentially a comparable basis with a movement where we had a very large rollout. We will see that coming back to growth during the course of H2 and beyond. The market perspective and then the VAS market is, because all the digitization of stores is driving a lot of needs in computer vision, data analytics and the retail media is only at the beginning. All this is going to be a very strong, strongly growing market. We're quite optimistic, you know, about it. At the same time, the profile of VusionGroup is increasingly unique because we have all this scope of solutions. The partnerships that we build with customers are multidimensional now, certainly not just ESL centric. I think we're quite excited now. You know, we also face the bumps in the road like, you know, the tariffs and things like that. We're very happy to be able to say that tariffs to date at least are not expected to impact our revenue guidance and our profitability guidance. Okay, great. Thank you. Thank you. We will now take the next question on the line of Hugo Paternoster from Kepler Cheuvreux. Please go ahead. Yes, good evening, can you hear me well? Yes, good evening. Yes, yes. My first question would be a follow up on Flavian and I just would like to have a little bit of more color. If you can elaborate on the momentum that you are currently building in Europe. I'm not sure you can comment by customer, but would it be possible to comment a little bit in terms of verticals, whether it's more in the grocery. In pharmacies and this kind of thing. My second question would be on the deal that you managed to have with Co-op. I just wanted to have a bit more detail in terms of value-added services in which this client was interested and if you can comment on that. The last one would be more a question, broadly speaking, on the traction that you manage to have in terms of value-added services. Overall, mainly interested in Captana, Memory, and Engage. In terms of all the pilots that you are currently rolling out. How. Is it received by client? How is it taking traction? Is it according to your own estimate? Are you pleased with that? Any comment on that would be useful, Yes. Regarding the first question on Europe, I think the various verticals have been definitely one of the drivers of the growth in Europe because since there is a higher level of penetration in the whole market because it started much long time ago, there is already 30%- 35% penetration. Obviously, there is a significant contribution to further growth in penetrating other verticals. Beauty, DIY, I mean beauty and cosmetics, DIY, pharmacy, obviously consumer electronics, although there is already a high penetration in consumer electronics. All these. There would be also automotive retailing that is starting to loom on the horizon with a few projects that are quite promising, all kinds of retailing. We have also specialty retailing, like we have a number of very advanced with multiple store pilots on eyewear, you know, glasses retailing. Actually, there's been a lot of, and every time there is some kind of specialty developments around the solutions. For instance, in eyewear, it's a very specific product where you have location, inventory, but also, you know, obviously pricing and a number of other factors. We're working on all these verticals and that's why we see growth coming from that. However, there are still many, many grocery retailers that have not yet and will sort of made the decision. There is still a lot of growth. I think about, for instance, in Germany, in the U.K., most of the retailers will adopt digital solutions in store and particularly ESLs or let's say digital shelf systems in the coming one or two years. There is still a lot to do in grocery and Co-op. Because you asked a question about Co-op, it's part of that sort of momentum in the U.K., 2,400 stores. It's a relatively fast and bold decision, quick. It shows the need, it shows how tense the situation is right now. There is high velocity of price, high cost of labor, high need for automation. Yes, there are many value-added services associated to the sale of ESL because first it's fully cloud operated. There is cloud platform. There are a few pilots now going to start on Captana and also on data analytics that we also are starting. Usually it starts with the first deployment of, let's say, the basic infrastructure of electronic shelf labels, and then you have all the other services coming up. Grocery tends to grow to 40%, 50% penetration. The market will drive growth in Europe as we already have. Don't forget that over the long run, if I look at our growth rate on average since 2020, we have above 20% growth on average in Europe, and it will continue. I think your last question was about traction in VAS. The VAS and Captana, particularly, you asked. We work with many clients now on very, very significant and large-scale, I would say really large-scale, pre-rollout pilots. We mentioned, I think publicly, even in two keynotes, major keynotes, the project with Carrefour, for instance, which has already 35 hypermarkets live. The project is extremely promising. We see that our solution is delivering a lot of things that are required, and many others are the same. The pipeline is strong, consistent with our high ambitions in this area. As I speak, we are, as of now, completely convinced of two things. One, that computer vision is going to be a must-have in the market like electronic shelf labels. It will be a very big market. It's the next wave. There will be an eye on every shelf in the future because it's so important to optimize a number of dimensions of the operational execution that there will be an eye on every shelf. Computer vision is going to be a big market. The second point, this is really a conviction, and frankly, all the projects on which we work are very promising. The second thing is that our strategy is the right one because we come from a strategy that is twofold. One is 360 shelf digitization, which means that we have computer vision embedded in digital shelf systems and, for instance, soon embedded in EdgeSense, which means computer vision works better. It's combining multiple sources of information which deliver unique accuracy. It's really high performance. We think that is going to be a very, very winning strategy in the future to have CV as part of a digital shelf system. In the future, it's like a smartphone. Would you buy a smartphone without a camera? No. That will be the same with a digital shelf system if we have an eye as well as automating display. The other side of our strategy is the collaborative model with brands, and our NielsenIQ partnership will be a strong asset in the future. I think based on our pipeline, we clearly believe we can achieve our ambitious target on Captana. You will see computer vision is going to be a must for retailers now. It takes a bit of time, it's true, but we're quite happy with the results of the current stage. Okay, just one follow up if I may, on Co-op with the signature of Co-op. Do you notice, I don't know, any reinforced interest from Co-op peers in the U.K. in terms of discussion with your client? I think in the U.K. there are probably very, very few retailers with whom we are not actively speaking or even in active pilots. I think it's a market that will catch up. It was lagging behind, to be frank. In fact, Co-op is really the first large rollout, large scale rollout and nationwide rollout. Yes, it's obviously triggering a wave that will continue. Same as Walmart in the U.S. is triggering a wave that will also continue. Okay, got it, very clear. Thank you very much. Thank you. We will now take the next question from the line of Adam Gildea from Bank of America. Please go ahead. Hi, thanks so much for taking my questions. I have two, please. First, you mentioned over 1,000 Walmart stores are now equipped. Is there any more color you can give around the cadence of that rollout through the 2027 target to roll out across all 4,600 stores? Should we be expecting another 500 or so stores in H2, or is this progressively accelerating in H2 and then 2026 as more of these production lines go live? Second, just a quick one on the guidance for European growth this year. When you say return to growth during H2, are you thinking of H2 as a whole being positive year over year, or like the exit rate in Q4 being positive for EMEA growth? Thanks so much. No, we think we see H2 as a whole being back to growth, probably more towards, you know, the second half of the semester, but overall growing, and what we see is that it should be able to compensate, let's say, the dip in H1, so that roughly we should be around stable. I think that's what we mentioned in 2025 as a whole. Regarding, sorry I started with the last question, but coming back on Walmart, yes, we're entering a phase of acceleration because, you know, there is a ramp up of capacity that's been described already several times. We are ramping up and putting in production more capacity as was sort of ordered. Now it's stepping up. We should see a continued acceleration, and for sure, you know, the full rollout, the full fleet will be rolled out, you know, before 2027. The only thing is that here I'm talking about, you need to be always thinking about store installed and store that's produced and sold and shipped because sometimes the installation phase can be not dependent necessarily on us. In terms of our revenue, it follows the production, but sometimes the installation is done more by Walmart. If there is, for instance, holiday season during the, you know, the end of the year, it can be. I can't give you any numbers of installed stores because we control, let's say, the production and the delivery but not necessarily the speed at which the stores are installed, especially towards the two last months of the year, which are very, very intense months in terms of the revenue and the activity stores. Sometimes they can slow down a little bit the installation. We don't control that. I can't give you a number on this, but for sure we are asked to deliver at high pace because the project is delivering very satisfactory results for the customer. That's super clear. Thanks so much. Thank you. We will now take the next question from the line of Valentin- Paul Jahan from Stifel. Please go ahead. Good evening, everybody. Doing me well? Yes, we do. Perfect. Thanks. I have three questions. The first one will be on. Vision OX operating system. My question is do you pay license. Fees to Qualcomm or for the communication. Protocol for the IP or not. Related services as you worked a lot with them in the recent past too. Develop it and therefore does the gross margin on Vision Cloud is accretive compared. With the gross margin on SaaS subscriptions such as Memory or not? This would be my first question. Yeah. The answer is yes. Did you say accretive you mean or. Yeah, yeah, yeah. It's obviously software sales, so it's accretive and there is a small rev share with Qualcomm. You're right. Regardless, I mean, in spite of that it's accretive, like, you know, like a software revenue. Can we say it is the most profitable solution in your portfolio? Generally speaking, software is the most profitable solution. I think Vision Cloud is also. I mean, all of Vision Cloud and VisionOX today is profitable, but Captana is also a profitable solution. Generally speaking, maybe. Thierry, you want to add a comment here, but I think it's a. I fully agree with you. I think that we don't enter into the details of the profitability of all the VAS lines, but roughly I would suggest that the Cloud and Vision Cloud are really very profitable, among the most profitable line of services that we are selling, and Captana for the recurring part as well. Everything which is really globally pure SaaS is very accretive for the group. I mean they are, let's say, in the standard. I mean there is nothing, I mean they are in the standard of the software company. It's just very classic, more profitable than the hardware, as I think it's been always explained, and is also a general, I would say, pattern of business. Yeah, my question was more profitable than Memory or Captana, but I understand that you don't want to answer it. Maybe my second question, it's kind of a follow up about growth prospect beyond 2025 actually, because your order book already gives you. Visibility through 2026, and because you mentioned solid goals for 2026 in your pro series, given the current development of your order book and current discussion with your customer, do you think you will be able to achieve more or less 20% growth in 2026, which is the figure that will put you on track for. Your 2027 targets, or does the current. Economic environment could lead to softer growth. In 2026 than this threshold? Yes, I mean. It's maybe early to already discuss the guidance for 2026, and we're only disclosing H1 2025. You may want to slightly elaborate on that here, but I think it's a bit early to already give a good visibility or an element of visibility on 2026. Otherwise, we don't need to see each other for the next 12 months. We need to keep a bit of—no, I agree with you, Thierry. Absolutely. I was going to say that, especially if we are talking about numbers. Like we said, solid growth because we see growth, because Americas will continue to grow and Europe would be back to growth. As a whole, we see, yeah, we see solid growth. Now, saying if it's what number, we need to wait probably until the end of the year to give you again, as usual, a guidance with 2026, especially since, as you can observe. Okay. Okay, so my last question would be around the working capital including upfront payments. The comparison base would be demanding with a significant upfront payment you collected from Walmart in 2024 and 2025, and before significant revenue with Walmart in 2025 and 2026. Should we expect a slight. Cash consumption in 2026 due to this working capital unwinding effect on this big contract or not? You seem to be learning still in 2026 rather than 2025. 2025 is not completed yet. Let's already focus on what needs to get completed. 2025 we said that we would generate positive free cash flow. 2026 we will see depending the pace of the rollout for the last doors of Walmart because as you know, we're going to reverse the positive impact on the cash due to the down payments paid by Walmart. I'm a bit more, I would say, cautious currently on 2026, but definitely 2025 would be a positive cash flow generation now. Okay, thank you. Thank you. We will now take the next question from the line of Johannes Ries from Apus Capital. Please go ahead. Yes, good afternoon, both. Here's from Frankfurt. Three short questions from my side. How is the pipeline about maybe further upgrade deals with existing customers like you have published with Carrefour? That's the first question. Other existing customers, you have other customers which are for years ago installed the ESL now ready also to move up the value chain and adopt more value-added services solutions? Yes, absolutely. In fact, we don't talk very often because we talk about new deals and new. You know, in the order entries, there are a lot of retailers that are customers for sometimes more than 10 years and who renew. Every time they renew, we renew, we migrate to cloud, we add some other solutions, some other features, we expand the scope of. It's also going on everywhere. We have customers who are renewing, et cetera. It's part of the momentum and the dynamic of the market. It's very positive because as we innovate a lot, we always have a lot to do with our existing customers. When I say 10 years, sometimes I mean we have customers that are generating permanent significant revenue for two decades. Yes, you are right to mention that we are often too always speaking about the new logos, but we have a lot of hundreds of existing logos, sometimes for more than a decade, and the churn is quite low. Another question, Johannes, it's a long time since you have been on this call actually, or you were too shy to ask questions. I was wondering where you have been. No, I think very often there had been many other questions that had too late in the row, but not a problem at all. Maybe second question regarding the impact of the dollar only maybe on your guidance. Compare that the dollar has weakened further in the last quarter and you stick to your guidance. The guidance is not constant currency. Therefore maybe help me, does the underlying growth higher or has you already been a little bit more cautious by setting up the guidance only to get it right? The bottom line, if I have it right in my head, is you are now nearly natural hedge, therefore the impact is limited, but more only on the absolute euro figures. Why you stick maybe, or you could stick with it despite this much weaker dollar and you have this negative translation effect. Yes, you're right, Johannes. We consider that currently the impact of the dollar is something that you can absorb on the revenue side. We can still deliver the revenue guidance despite a weaker dollar. You're right that on the profitability side the impact is quite limited because you get almost a natural hedge. The revenues that you collect in dollars and the cost that you pay out in dollars are quite similar. It has a very limited impact on the profitability. Great, thanks. Finally, maybe a clarification more general, not on special figures to the question from the colleague asked before. If I got it right, despite a lot has happened in the world in the meantime since you had the Capital Markets Day two years ago, you are still confident to achieve your 2027 ambition? Yes, absolutely, we are. You know, we set ourselves, you know, an ambition at the end of 2022 for 2027. We are halfway on the plan. We have delivered, you know, we have already doubled the size of the company since then. We have done in H1 more revenue than in the total year of 2022, which was when we launched the plan. We are halfway. We are, we're quite excited now. Is the 2027 target a stretching and an ambitious one? Absolutely it is. Otherwise it would not be stretching the company and putting us and everybody in the company on their toes. It's a stretching, but we have a pipeline that makes it very possible. We are definitely willing to deliver. I think halfway we're really good. Yes, it's not 100% sure. Otherwise it would not be a very, you know, it would not be a very good target. It's difficult. Have we already delivered ambitious target in the past? You know that. Yes, we did. Really halfway, we think it's quite a good, quite a good position to be. Yes. Sounds very good. That's all my questions. Thanks a lot. Good luck. Up to next time. In three months we get the full figures. Yeah, the full figures is on the 15th of September. I wish you in the meantime a great summer. Me too. Same to you. Thanks a lot. Thank you. Thank you. We will now take the last question from the line of Gilles Crespel from Alizés. Please go ahead. Good evening, gentlemen. Thank you very much for taking my question. Congratulations for the level of activity, especially in North America. I had, if I may, two. One is. After those trends, I see two which are little improving. One is the growth in EU. You already discussed that. When we look at it, the Q2 is even below the Q1 growth. Without entering into the details on a. Quarter to quarter basis, does your order. Book now give you some confidence on having a positive EU over the full year? That would be my first question. The second trend where I'm seeing little progress is a VAS percentage of revenues which is not growing. At this stage we are about 5%- 6%, whereas you set yourself a target of about 30%, if I remember well. I wondered what could trigger there an actual takeoff for this VAS as percentage of revenue. Thank you very much. Yes, thank you, Gilles, for the question regarding Q1 and Q2. There is sequential growth between Q1 and Q2. I think Q2 is 18% above Q1. It's clearly starting to show. Basically, the revenue follows order entries, and we have started coming back to growth in order entries in the last part of 2024. It's coming now in the delivery. We have a sequential growth between Q1 and Q2 in Europe, as I mentioned, and we see this growth continuing and being back in Europe to growth in H2. I think we mentioned during the call and actually in the press release that we expect H2 to be back to growth and the year to be roughly stable versus last year, thanks to the—because some of the growth is coming later in the year. H2, we see it back to growth and full year roughly stable, compensating the dip in H1. It's what I already answered. The second, which is also in the press release and regarding your second question, I think the growth in VAS is significant. 80%. It's 100% actually in H1. It's growing. It's not linear, and particularly the percentage because the percentage comes with a significant part of your installed base that has a penetration. We are in a network effect. Every time you have a network effect, you have a cumulative increase in the percentage because you need to have every year you are accumulating the revenues of your installed base that have penetration on cloud, on Captana, et cetera. It is something that's mechanically not linear. We have a target of EUR 600+ million in 2027, and our pipeline is completely consistent with this target. We are definitely thinking we can achieve these targets. The 30% VAS, well, revenue percentage in 2027. This being part recurring, part non-recurring, correct? Yes, part recurring, part non-recurring. We are targeting an absolute number because, of course, if we are doing more hardware sales or more ESL sales in 2027 or less, it can be different in terms of the percentage. Roughly, what we are targeting for 2027 is around EUR 600 million in all, VAS revenues. I think it's EUR 650 million actually. Thierry, correct me if I'm misrepresenting the Fusion 2027 plan. Today, it's not linear because the penetration in Captana will grow, like vCloud has a growth curve which is not at all linear. Now it's growing very fast, and VusionOX is growing very fast. Those things are not linear at all. Innovation is never linear. In fact, the penetration of ESL in the world is not linear, it's just accelerating. I think you realize that. You need to have a certain level of penetration to reach the moment where it's scaling much faster. That's how it is always in innovation. Yeah. Part of it is adoption of services, and that can be. I'm not expecting a perfectly linear trend, but I didn't see over the last quarters an increase on the percentage of those VAS, the recurring part of it, against the revenues. We'll see over the next quarters for sure. You have already the answer. We are expecting an 80% growth this year on VAS, so I think the answer is already there. We're expecting. I mean, you know, it's. Just. Look at our guidance. It'll be no surprise for 2025. Okay. Thank you very much. Thank you. I would now like to turn the conference back to Thierry Gadou for closing remarks. Thank you for your time tonight. I wish you a great afternoon or evening, and we will be happy to see you after the summer on September 15th for the full financial figures of this excellent first semester. Thank you very much. Bye bye. This concludes today's conference call. Thank you for participating. You may now disconnect.