Good afternoon, and welcome to poLight's Q2 post-quarter Q&A. We have already had a Q&A after the quarterly presentation. But in our experience, there is always a lot of questions. The same goes today. We have so far received over 50 questions. After reviewed them, we see that some of them are quite similar. If you do not recognize the exact wording of your question, it might be that we have consolidated several into one. With me, as always, and very necessary, is our dear CEO, Øyvind Isaksen. Thank you. What we will do today is go through the questions. You will be able to send in questions as we go along, but we will close for that in 30 minutes. Then we have a hard stop of the Q&A in 45 minutes. Kicking off, Øyvind, there are lots of questions regarding the design-in that we announced earlier. I will just get going and start on a few of those. Regarding the design-in, you mentioned that there have been three POs for mass production. Could you please explain the term mass production and why it is used? Is it from a unit price perspective, or is it that the customer is building up for mass production? How would the margin be for, say, a mass production? Good question. Those three POs are all material for which the customer plan to use in a commercial product. It is also at a price which is kind of connected to exactly that. That margined aspect, we do not want to comment on the margin, but we have been saying before that we typically, at the moment in the consumer space, we are selling TLens for around $2 +. Great. You now classify one consumer AR/MR case as design-in with expected product release in 2026. Could you give more color on what remains technically and commercially before this reaches design win status? If that consumer product launches as planned, how should we think about the difference between current development phase average sales price and volume average sales price? What order magnitude would signal the transition from qualification to production quantities? Long question. The last three POs, as you probably have seen, is that the first one was bigger than the two following ones. We typically have tried to get as big POs as possible. At the same time, the customer would like to minimize inventory, so they basically like us to keep the inventory, or suppliers. But the first PO was bigger, which is forced by us, and the two following is the POs they would like to kind of standardize on size, also in the future deployment. There was a question related to price, and I am sure I got it. But as I said, in the early development stage, when they order more like, say, samples for the development phase, then they paid a different price, multiple, say 2x, 3x, 4 x the mass production price. But those three POs are mass production prices. Those price level are triggered by that they are going to use those samples for commercial product. Good. The last part of that question was if we could say anything about the order magnitude. So what size of an order means that we consider it to be for production rather than from qualification? Yeah. So that varies. As I said, those three POs are all for mass production, but the first one was bigger than the two following. So that is basically a negotiation. The customer would like to place as small POs and as often as possible, whereas we would like to have as high visibility and a big PO as possible. So that is it. It is not an exact answer to that. The leading OEM that is registered for design-in was called a big guy in the February presentation when a PO came for this project. When poLight uses terms like leading OEM and big guy, does this mean that the project we are designed into is actually with a major consumer player? This case is with a, I would say, a big company and a major player in the ecosystem. That is all what we can say. Yes. With that answer, we can skip quite many questions— Yeah. Mm-hmm. —trying to identify this customer. I have to say, I can fully understand the eagerness to understand who it is. I have no problems understanding that. I just need to stress, which I mentioned in several other questions before, is that the important thing for poLight now is that this is the first design-in and hopefully design win in a consumer AR/MR space, in the AR/MR space. A space, a market segment we have defined as the absolutely most important for poLight. Finally, also in the consumer segment. So that is the important thing. Whether it's A, B, C, or D is, of course, interesting, but it's not the important thing. The important thing is that we are putting our poLight flag in the AR/MR consumer space with a high-end solution, which will be a fundamental platform for future growth. Good specification. With that, you also directly answered another question we have here. Can we say anything about why this customer has chosen TLens in their product, and how they are satisfied with TLens compared to other technologies that they have tried? The unique selling points that was— Yeah. —important to them. Yeah. I think in the first slide when we described poLight's technology platform, compactness, speed, constant field of view, power consumption, are the critical things many players are looking at. Many are the same. All the characteristic they need in an AR/MR application, we score extremely high on the evaluation chart, and that's same for this customer. Of course, they do consider our other options. They consider not using AF, which many do and many will still do. If they compare us to anything, I think from a technology perspective, if we perform as a company, I think we will rank really high on that list, and maybe highest. Then, of course, as I mentioned several times, we will potentially be more expensive. Not only on component level, but also on a camera module level. That is then, in a way, the value in using our technology, which is flipping it into our technology and our platform. Speed, power consumption, constant field of view, compactness, to mention a few. Do we know if this design-in, will it be launched at an event, or do we know anything about that at all? No comment. We've had this question directly for this design-in, but also in general. There are several who are wondering if we are designed into or have a design win also, we'll make this general, for one set of glasses for the consumer glasses. Is that typically our expectation that we will be used in other generations of the same glass or different versions, sort of a product portfolio? Or, do we see ourselves as more of a one-trick pony in that product portfolio? No. It's a very good question, actually. For many years when we've been around in the market, we have been emphasizing a lot on that poLight is a future-proof company, and that we can be with customer for a long time in many generation. That is definitely the hope we have. Also that's what customer want. For the customer to take a new technology and design it into their product is a huge investment. When they invest in this kind of new technology platform, they're not going to do that for one case. So they also hope that they can reuse the competence they learn because it's very different for a camera module system engineer in a company to design this autofocus functionality based on TLens compared to, say, a VCM. They have a very steep learning, really steep learning, costing them a lot, both man-hours, and also related to prototyping and what have you. So they also want to have something which as a platform perspective can last for several generation. So that's definitely the aim we have, and actually also the aim the customer have. Good. Now a question more about our communication. We have had this before, but this is quite clear question. poLight has used terms such as OEM, leading OEM, and top-tier OEM when discussing consumer and AR/MR projects. Could you clarify what poLight means by top tier or leading in this context? Does it refer to the company's overall size and global position in consumer electronics, or does it specifically talk about its position within AR/MR wearables, smartphones, computers, or related markets? I can agree that this is a little bit confusing. In general, we are using Tier 1, Tier 2, Tier 3, leading, major. We use these Tier 1 or leading, meaning that it is a very sizable company. It is a worldwide known company. Yes, when we talk about consumer, of course, it is in the consumer space. So it is big companies, which many people will know. Then leading Tier 1, these are, should I say, we have been confusing you by design. Also the customer we are talking with and working with, they also really are nervous that the way we express and what we say and how we say it, is leading people to understand who it is, and that they do not want. Anyway, the cases which you have been following us closely and the press releases are, I would say, companies which are big companies in the consumer space. I cannot be more specific. No. This, I believe, is the last question about the design -in, because one person here is asking if this is something that is about the distribution. Do we know anything about the distribution? Because they are asking, could I buy this in Norway when it launches? Do we know? Sorry, Joakim. What the question was? Can this be bought in Norway when it is launched? Do we know? That we do not know, but what we know that normally they do not launch worldwide day one. Do not worry, that is a general comment. But we do not know. Could the same OEM have two design-ins in the same year, so in this year? That is possible. If you talk about this particular design-in customer, we are already engaging with that customer on other cases. I do not believe those will develop as quick as becoming a design-in this year, but we are already engaging with them with new opportunities. Based on poLight's communication over the last year, my understanding is that three of the most significant current TLens consumer projects are: one, consumer AR/MR design-in project that has been talked about; two, the Q Tech qualification program; and three, the AR camera program. Is that understanding correct? Can you confirm if these are three different end customers? Those are three of the cases we have been mentioning in press releases. We have others you have not seen. Yeah. Those three are different, but there are more. Yeah. Here is a question directly about another one, though. A couple of years ago, poLight was mentioned by SHARP at their Tech- Day. Can you tell us something about how the work with SHARP is progressing? Yeah. Now, of course, we are in dialogue with SHARP. We know them very well. They know us very well. I do not have any comment on any details on that relationship. Looking at the 20 active consumer AR/MR PoC projects, how many of these OEM cases have progressed past the initial optical qualification stage to reach system-level validation, positioning them to transition into design-ins late in 2026 or early in 2027? I think that most of those PoCs are. There are some of these PoCs which in addition to the design-in we talked about last quarter. There are some other PoC which are getting more and more mature. Also, some of them you would not have seen in being referred to in a press release. I do not want to go into the details of how many, how big part of it, but are quite a few, which is also starting to be quite mature. The current AR/MR growth story is anchored to one consumer OEM design-in and its follow-on purchase orders. I swear this question is not about that. Is there an active strategy to land a second AR/MR design-in with a different OEM in parallel, or is management's near-term focus deliberately concentrated on proving out this first one before diversifying the customer base? No, not at all. We are extremely active with many cases. You can say too many, because we are killing the organization. But we are very active and we have many cases we are working on. You've seen from many of the PoCs, it's getting more mature. So no, there's definitely a kind of an interesting pipeline maturing, and definitely much more than the design-in. In keeping with that pipeline, the fact that there is a design-in now, could the progress in that program help accelerate the other more mature programs? Will it have an effect, do you think? Yeah, good question. I think that when the market starts to see things coming out and hopefully getting good feedback, I think that will help. As it helped when we got those design wins in the enterprise AR/MR, remember? Then actually many of the consumer guys bought those product, tested it as a part of the evaluation. Of course, if it's now coming out a consumer product with our products inside, exactly the same will happen. Many others would like to have the kind of same or similar or better performance. So I think yes. Good. Then we will close that category and move on to more questions now relating to TWedge. Which sample number is TWedge on now, and how many more sample upgrades do you think are yet to be done before it is ready for a customer for mass production? Yet another very good question. We are TS5, fifth -generation sample. We have the next revision on the drawing table. We are hoping that next revision will be very close to what will go into a program for aiming a mass production product. As we have talked about many times before, we are really trying to go very hand in hand with some leading customers to make sure that we have a component which is fitting on the system level for customers. We will try to avoid to move along without having that close interaction. This TWedge integrated into the light engine is a very complicated system, which needs to be carefully thought through and needs to be designed. The TWedge need to be adapted, and the system needs to be adapted to TWedge. This is really something we need to do together closely with the customer. Also, our hope is to somehow get some financial support over and above selling samples. That, as we have said in the quarterly report, is that that is a complex thing because then you end very often up in discussion what rights do they get while giving us financial support. That is why that is a relatively complex dialogue, and we do not know the outcome of that. What I can say is that the feedback we have also from latest meetings is extremely encouraging when it comes to the need for TWedge. What I see today is that there is a need for this product. It is more the matter of fact what kind of risk-taking are we willing to take, and what kind of financial contribution do we need to have to kick it off. We are relatively ready to kick off. As I said, we have a revised design on the table and on the paper, and we are ready to move, but we would like to try to get as much commitment as possible. Yes. We have communicated about this before. We have a couple of questions about the timeline, because at one point, I think we indicated that it could happen in Q2. Since we are now in Q3, I guess that just reflects the complexity as you just mentioned. Correct. Correct. It is difficult to say when. It is being worked on. It's being definitely worked on, yes. Is the design-in customer currently also evaluating TWedge for their next-generation display architectures, or are the TWedge PoC evaluations driven by a completely separate group of OEMs? You can answer that in more general context, I think. I can say that many of the people we work and qualify over TLens is also qualifying the TWedge. Okay. TWedge has been flagged as strategically important for several years, but still has not attracted customer funding as we've established. If that doesn't change within the next 12 months, what is then the plan? Would poLight fund commercialization itself, put it on the shelf, or look at licensing it out? Yeah, good question. I would not say that we have not got any financial support. We have been selling samples for several million NOKs. I do not have the total number on the top of my head, but it is not few millions we have been selling. We are selling unit price samples in several thousands of U.S. dollar per small TWedge. We know that there are key customers which is spending a lot of money in planning their designs using TWedge. So, it would be wrong to say that there has not been any kind of support and willingness. It has been a huge support and willingness. But what we would like to have, which is a little bit unusual to be honest in that industry, I am coming from telecom and oil industry where it is more, at least in the oil industry, more usual to have this joint industry project where we ask for developing support for the development program. So not only selling samples, but for the development program. That is a little bit unusual, especially when I do not give them any rights. So that is why it is complicated. If we find out in six months from now that the customer is saying, "Maybe not money, but we can give you promises for a project in two years from now if you have the component we need." There may be a kind of promises or commitment, which we value and trust so much that we kick off without financial support. But my role is, of course, to protect cash, protect shareholder value. That is why I want to get as good deal as possible. Good. Then we close the questions of TWedge and move on to more supply chain type questions. p oLight has a large inventory of wafers that have been purchased. These are written down in value in the accounts every quarter, and that has a negative impact on EBITDA, gross margin, and then EBITDA. Is it true that the quality of the wafers does not really deteriorate corresponding to the write-down, and that these wafers can be included in future production? Yeah. There are two sides of that. There is a mechanics which you, Joakim, using when writing down that inventory. That is only mechanics and nothing to do with the quality of the inventory. Meaning that we are taking some whatever percent write-down due to just mechanics and doesn't relate to anything about having less quality. Then, of course, there are some elements. I would say smaller elements that we have seen through a manufacturing process, assembly process, test process. That some of this inventory is not good. It can be something went wrong in the manufacturing. Then, it's a write-off of more factual than cannot be used type write-down. But I would say those are smaller part of it. The inventory which is there is regarded as good inventory, but to be prudent, we write down due to the age. In the 2025 Q3 presentation, you stated that installed capacity was around 200,000 per month. Test installed capacity was around 400,000 - 500,000 per month with a ramp-up plan in place for 1 million per month in the Philippines. Can you say anything about what those numbers are expected to be at the end of Q3 and end of Q4 in 2026? What will happen in that timeframe is, of course, that we will have two lines, including the Q Tech, which will have a similar capacity. That's a doubling. Then we also have order a new final test machine, which will double the test capacity at Tongxing. That's what's going to happen. When it comes to the long lead items for increasing capacity further, it is the final test machine, which is critical. That's kind of allocated capacity or more standard equipment, which is today at Tongxing at 200,000 can easily be changed because those are standard machinery which easily can allocate more to us. I think also in terms of capacity. When we talk about this, it is not only about increasing capacity so we can do more a week, but also that we can do different variants of a TLens simultaneously. So we can ship to different customers and then decrease the lead time per customer. That is also good to know. The Q Tech line was reportedly built around the expected volumes of one OEM. If that OEM does not proceed, who will bear the cost of the idle capacity? Is it Q Tech or poLight? Just to rephrase that or to comment on that question, because it was not really built for the capacity of that OEM. It was Q Tech's need to prove the ability to produce. The capacity they need for that particular customer, we would expect will be much higher. Good. So moving on to more industrial segment and MLens. About MLens and PoCs. MLens is a more complete package than a bare TLens. Does that translate into quicker PoCs and less intensive customer support, or are MLens PoCs invisible from your point of view, and what do you see are mainly MLens sales? So missing that, but I think it is about is it shortening the time- to- market? That's correct. We believe that the MLens will be an easier way for a customer to implement our technology. A little bit like plug and play. If the same customer were to go from scratch and design a system based on their own whatever lens stack and then TLens, it will take them much, much longer time and cost them much, much more. Having that standard MLens will enable that to move much quicker and much cheaper. That's exactly that seen from the customer side. From our side also, of course, but for our side also, we suddenly have moved from selling a TLens, one TLens to some dollars, to selling something which includes two TLenses to much many more dollars. Mm-hmm. What is the feedback from customers on the samples that have been sent out? It's still early, I would say. It shouldn't be too, what should I say? I cannot be too concrete on it, but what I'm hearing is positive. But we still remain to and we have sold samples. I think that has been received well, but we haven't really yet any kind of design-in on that concept. But we have a lot of interest. Robotics seems to be the new big thing that investors are interested in now. Have you been following that vertical, and do you see AR/MR vision as a gateway also into that market? Yeah. I think that's an interesting market. I think that potentially is an interesting market, and we are somehow a little bit involved in that. Yes, I think that could be an interesting market also for us. But again, I think that there are so many interesting markets. We also need to, as a company, we also need to dare to focus, and we need to dare to have laser focus. If you look at the pipeline in the consumer AR/MR space, which we present on a quarterly basis, it's massive. It's really, really massive. I don't know if it comes true, but we are sitting on so many opportunities in that space. That space really, really needs our technology. Both on the display side and on the camera side. We must not dilute our effort in really performing in that market segment. It will be instrumental to be successful for building shareholder value in that market segment. That's why we cannot spend so much resources on other market segments. I would love to do it in a way, but also, I've been a CEO in tech companies in my whole adult life. I also see that the recipe of disaster is not to focus. We have to be laser- focused. At least what we see now, with all the opportunities, we need to make sure we take care of them in the AR/MR space. Good. Then moving on to financials. Some of these questions I can answer, too. But this one, with Q Tech being both your largest shareholder and a camera module manufacturer, how do you ensure that gross margins remain with poLight on the TLens component rather than shift to the finished module level in Q Tech's favor? Mm-hmm. The fact is that when we work with a OEM, it is the OEM, which I've just said many times, who is kind of the big boss. The big boss, he is negotiating all key components. It's we talking to the OEM and agreeing on the price, and the common module guy will be informed. Then we have a question. Oh, sorry. [inaudible] in our hands. We have a question here. I will not read the whole question, but it refers to the Analyst Group's commissioned research report. Their latest one that has a bull case which models revenues, and also an average sales price with sort of assumptions about volumes. I think in general, this is their analysis. They have built it based on market data they find available, publicly available information from us. We have no input, and we do not pull the plug on any of their forecasts. This is their work entirely. I think it is quite prudent for us also then to not comment on those numbers. I think any analysis of any company will be one company's interpretation of how that company could go. If we had several analysis, it might show different scenarios. I think that is the extent to which we will comment on that. Yeah. Gross margin was approximately 50% this quarter, but a meaningful part of Q2 revenues came from NRE, tied to AR/MR rather than a steady state product shipment. As NRE gives more way to recurring TLens shipments at volume, is it management's expectations that margin holds near 50%, improves with scale, or comes under pressure from mass production pricing dynamics? I think that's also a good question. I think that we need to expect that increased volume from customers will dictate and put the pressure on price. Then, of course, we will work hard to also make sure that we are able to improve cost efficiency in the supply chain. But I think it will not be, for me, surprising if the gross margin goes down. But our analysis is showing that it can go down, yes, but also that still on the bottom line, we will be at higher volume, a very profitable company. You referred to current revenue as positioning revenue tied to qualification work and inventory building rather than actual product demand. At this point, do you have a sense of which quarter might be the first where revenue is genuinely pulled by end product sales rather than qualification activity? I think we can say we have an internal forecast that we work on and keep constantly updated, b ut that is also an internal forecast. We do not disclose and share that information with the market. I think that's all we can say about that. Yeah. But maybe just adding, if you allow me, Joakim, to say that it is not true that it is only positioning revenue in the quarter figures. There are commercial sales to other market segments, industrial. There are also, if you look at these three POs from the design-in, that is TLens, which will be in a product on the market. Very true. At the current burn rate and hiring plan, how many quarters does the NOK 243.7 million cash balance cover? I think that is also a part of a financial forecast that we will not answer. We have commented this on several occasions and what we have said before, and we will repeat again, is that in certain scenarios, we have sufficient cash. In other scenarios, we do not. That is the nature of being a company in the stage that we are in. This next question is about the same thing. Moving on to more general technology and product development. Now a question about patents. With the earliest core patents from 2006 set to expire starting this September, how has poLight prepared strategically for this transition? What do you expect the net financial impact on your IP- budget to be, weighing saving from lapsed maintenance fees against potential increased spend on monitoring and enforcement? Complex question. You can guess who it's from. Yeah. I don't know if I have a good answer to that, at least the last part. I can say that the strategy we have had for many years is that even though the core patent is starting to get old, we have continuously tried to build around that patent to extend the protection somehow by different other patents being important for having a tail end with that performance we have. That's how we've done it. We feel still relatively confident in how we are protected due to that. Then as I've been saying many, many times, being able to produce at quality what we have, it's extremely difficult. Sitting on the inside, I've been here now for 12 years. When I joined the company, my instruction was that to commercialize the company and do an IPO. Because the product was ready. Well, the product was not ready. It was not that it was not kind of developed. It was developed, but it was a hell of a job to get it in production, to make sure it passed all the qualification criteria typical customer would have. I would like to see that company, even though they have the ability to use whatever patent to do that, before we are installed in a big way in the market with a much higher performance device than anybody else can ever do. I'm not very concerned. We have quite a few additional questions, but we are also at quarter to 7:00 AM, which we said would be our hard stop. I have tried to see if I could find one sort of concluding question that [inaudible]. We can keep an eye for you, Joakim. I can pick this question. This is completely unrelated to everything else that has been talked about. But how is recruiting going? Do you manage to find and attract the staff you need? That is really difficult, to be honest. We still have some open positions around the world, also actually in the headquarter. So it is difficult. We have done, I do not know, 10 +, Joakim, this year. We still kind of have, say five, six, seven, eight open positions. They are difficult to find. They are really difficult to find. We are recruiting in China, we are recruiting in U.S., we are recruiting in headquarter, looking for people with experience we need from the ecosystem. Highly educated mechanical engineer, Double E's, customer support. They are difficult because we are also a difficult company to work with, and we do expect a lot from the people we employ. But we have built a fantastic team. I just had an interview with a new employer, and the way we screen and we are extremely selective. That is also, so we are a little bit picky. I am saying that we need extraordinary performance people to achieve the extraordinary result we are set up to do. That is why we are also a little bit picky, and we have to be picky. But yes, it is difficult, but we are getting there. We have also recruited in the Philippines this year. Yeah, absolutely. Yes. Actually a lot. Yes, you are right. But we are not looking actively at the moment for more in the— No. —in the Philippines. We are looking for more in China, we are looking for more in headquarter, we are looking for more in U.S. Yeah. Just for everyone who sent in a question that has not been answered, we appreciate your questions. We will transition them to the ir.polight.com page, where we will have them as written questions. We will answer them in written form. So you will have your questions answered even though we did not have time for it during this Q&A. We are very fortunate to have such an interested shareholder base that continues to follow us and ask us and drill down on the things that we say. It is truly a blessing and it is absolutely fantastic to participate in these Q&As and receive this kind of interest. So thanks a lot. We are not at all ungrateful because we do not answer your question. We will, but just not right now. Thank you a lot. Have a great evening and we will see you next time. Remember, look out for the Capital Market Day on the 30th of October. We hope to see a lot of you there.