Good morning, everybody, and welcome to Smartoptics Financial Presentation Q2 2025. Since we are in July, it's online only today. I hope that's acceptable. I'm here in Rome, and my CFO, Stefan Karlsson, is in Stockholm. He will participate in a while. We also have a moderator to take care of the questions that come in through the portal and from our analysts. Again, welcome. I will move straight into the first half of 2025 and quarter two. Of course, it is a remarkably strong quarter. I'm super happy with the results in this quarter. We have a lot of reasons to be very happy. We live in a mega trend, the ever-growing demand for bandwidth. We can see clearly that this mega trend has a new best buddy. It's called AI. We're clearly seeing AI starting to influence our business in several ways. That is something I will come back to and talk about later as we introduce our new strategic objectives for the company. It is the strongest quarter ever in the company and a record high growth as well. We're also seeing our underlying demand being super strong, and that's something that we measure on a day-to-day basis, looking at our order intake in the company. Now, order intake is not an audited number, and it is not a number that we are presenting in general, but I want to give you a flavor of what we have been looking at over the past three quarters. Order booking was above $19 million in Q4. It was above $18 million in Q1, and now it's above $20 million. That is, of course, super strong, and it indicates a really good momentum. I'm also very happy with the first half result with 29% growth. This is probably a better measure to look at the company over longer periods and a little bit of market education here. It is difficult for us to steer the revenue recognition into a particular quarter, and I have to say in this particular year, it could very well have been that Q1 was four or five points higher and Q2 four or five points lower because we did have revenue recognition very early in April. When analyzing Smartoptics, please use a little bit longer timeframes for your estimates. Overall, very good results, partly driven by the fact that we have a breakthrough in the company. We have won and been selected and received an order and delivered to a hyperscale organization. It is a data center interconnect application in California for a subsidiary of the hyperscaler. Now, to clarify a little bit around this, the purchase order and the agreements, such as purchasing terms and conditions and the code of conduct and things of that nature, is with the mother organization. The application is within the subsidiary. This is, of course, a proof point and a very strong sign that Smartoptics can be relevant for the largest and most demanding customers that we have in our business. It is way too early to say what does this mean in terms of future revenues and our possibilities to get into the main applications of the hyperscaler in question. We haven't even started to work on that. Priority is right now to have a very satisfied customer and to deliver above expectations. We will start working on scaling this business. We will come back to that at some point in the future. It's a good proof point, and it's a very good sign that we have achieved this in the quarter. This is affecting U.S. revenue, of course, in a very positive way. The order is around $2.4 million. A sizable order, but not unique for the company. We have had several orders in the past of that size, and we are working on many opportunities of that size. In that sense, it's not unique. The U.S. is delivering all the way through the quarter, and we will come back to the details of that, but very, very strong momentum in the U.S. It is also our main investment areas that we have been investing in for the past 5, 6 years: optical solutions, software, and services that are driving the revenue in the quarter. That's very positive. That's very positive because I think that's where we will build future shareholder value to a large extent in the company. The increased revenue is also driving an increase, a rebound in EBITDA, EBITDA, and EBIT margins. This is despite an impact, a negative impact by tariffs in the U.S. It's around 2% on all of our margins that you see here. Stefan will come back to the details later. In the middle of summer, we feel it's a very good timing for us now to start looking ahead, to lift our eyes above the current horizon and our $100 million revenue target and start looking at what are we working on on a day-to-day basis and what are we planning for in this company for the next period, which is 2026- 2030. The reason why we are talking about this now is that we have come out of our annual strategy update where we have redefined and introduced a number of new growth areas, potential growth areas for the company. We want to start talking about them. I think also, I have to admit that given where we are, given the momentum in the company, and given what I just said specifically around order booking, I would say that although we're going to reach our $100 million target, it is no longer a mea ningful way to run the company. It is simply a too low target to take any effective decisions and investments on. We have to look ahead, and that is why we're introducing new targets today. I will come back to that. I will break down the revenue. There we go. The normal deep dive into the revenue numbers, starting with geography. Plus 80% in Americas, where a part of that was the large project that we delivered in the quarter. Below that, it's obvious that Americas is delivering in every aspect this quarter. Whatever fears we had in the beginning of April when we presented our Q1 results related to U.S. trade policy, those are really, those uncertainties are really reduced at this time. We will not talk more about that in any detail in this quarter presentation. I think we have learned over the past months here that it is really quite meaningless to try to stipulate and guess what is going to happen next. It's also quite obvious to us that whatever tariffs are there, the underlying demand for bandwidth, the growth in AI, and the demand to renew and renovate networks to cope with future traffic demands is much stronger. Hence, the demand is there and things will continue. EMEA, a little bit up. Not a strong quarter in EMEA. There are two things to say about EMEA. I think EMEA has changed a little bit where we have moved from being very dependent on many smaller deals, enterprise, etc. We still have them. They go up and down between the quarters, mainly up in the past couple of years, of course, as you have seen. We're also seeing a new phenomenon in EMEA where we have a similar situation to Americas and the U.S., where we have lined up a number of really large accounts that we are now in the final phases of business development and sales processes. That's new, and that's very, very promising for EMEA that we can see also large account traction becoming a reality in EMEA. We're also seeing new revenues from new parts of Europe, Middle East, and Africa, namely Africa, and I will come back to that a bit later. The other thing I want to say is that my European sales team was instrumental and deeply involved in closing the large project in the quarter, the hyperscaler account. Kudos to my EMEA team. Really, really good work there, guys. Yes. APAC, still, although a little bit down, I've said over the past quarters here that we are seeing meaningful revenues coming out of APAC. We have traction in APAC driven from certain geographies and to a large extent associated with hyperscale investments and data center growth in the region where we are becoming a very attractive alternative to Chinese vendors, which are generally not welcome in that environment. This is not hyperscalers buying from us in Asia. This is our customers connecting huge bandwidths into the cloud environments, driving a business for us. APAC is there, and it seems to be there to stay, and it seems to be worth investing more in, is the conclusion that we have come to in our strategy work. I will talk a little bit more about that shortly. Looking at products, as I said, remarkable growth in business areas, solution, software, and services. Those of you who have followed us over the years know that these business areas are tightly associated with each other. When we sell solutions, we sell software, and we sell service. If we don't sell solutions, we rarely sell software and service other than renewals and repeat business, of course, which is an instrumental part of this. On the software and service, we're seeing new phenomena in the company. Our SoSmart software platform is now contributing in a very meaningful way to our revenue. It is great because it's increasing the recurring revenue in the company, but it's also a new phenomenon out there when we are winning business because of the quality and the features and the look and feel of the SoSmart platform. This has not been the case in previous years. The main reason for Smartoptics to win a deal or win a new account has always been that we are a very cost-effective, lean company that can solve huge bandwidth problems at a lower cost than competition. From now, it is cost efficiency, and it is features and the look and feel and the general design of our software platforms that makes customers choose Smartoptics. That's very, very nice, a very, very nice position for us to be in. It's an investment area that you will see we will increase our efforts in in the future. On optical devices, which we have pinpointed as an area that we want to grow a little bit faster going forward, it's an area where we did not, I would say that we have probably underinvested in over the years. We have started off our investments about 6 months ago. It's a long punch list of actions that will be implemented over time here. We are not quite there yet to see all of the results of that. For sure, there will be more coming out of business area optical devices. Having said that, we're seeing growth. It's the best quarter of the five quarters that we are presenting here. It's a very stable revenue stream and a stable business. It's also a business that we use for other purposes such as cross-selling and upselling solutions, software, and services. A very valuable business for us that we intend to grow faster going forward. I will hand over to CFO Stefan Karlsson to take you through the financial details. Working now. Yeah. Thank you, Magnus. Happy to see you all here. I'm happy to share this great report with you. Revenue increased by 43.7% to $18.7 million compared to $13.0 million, which, as Magnus mentioned, is strongly driven by Americas growth to $12.3 million over $6.9 million last year. Gross margin 48.6% compared to 47.3% last year, despite the impact we have from U.S. tariffs. In Q2, we in revenue have some compensation for tariffs in Q2 compared to in Q1, where we didn't have that much compensation since we had old orders that executed on in Q1. The EBITDA is $2.6 million compared to $1.0 million, and it's an increase by $1.6 million, of which $2.9 million is related to revenue increase and a slight margin increase. $1.3 million is an increased cost of employee benefit expenses and other operating expenses. The increase is 27% to $6.5 million compared to $5.2 million. That is driven by organizational growth, annual salary increase, and FX impact mainly. Full-time equivalents grow with 11% from 119 in Q2 last year to 132 in Q2 this year. Costs per employee grow by 14% from Q2 to 24. That is mainly then related to annual salary review of 4% and FX impact of 4% and increased sales commission. The FX exposure in employee benefit expenses and other operating expenses is mainly 70% based in SEK and NOK, 20% in dollars, while we have revenue and COGS predominantly U.S.-based. The EBITDA margin is then 13.7% in the quarter compared to 7.8% last year. Operating cash flow from operations in the quarter was -$0.5 million compared to -$1.9 million. We see a net increase of trade receivables in Q2 of $1.5 million. The inventory has increased with 1.9% from Q1 2025 to a large extent driven by an FX impact in the revaluation of the inventory and that we have additional product parts to support our tariff situation. Trade payables based on high purchases consequently increased by 0.8% in Q2. Over to the balance sheet, we have an equity ratio of about 53% compared to 61% last year. We see it shrink when the company balance sheet is growing together with the company. Non-current assets is $8.8 million compared to $7.0 million last year and consists of capitalized development expenses, tangible assets, leases, and deferred tax assets. We have part of it is a new ERP system of 0.6%, which we will amortize from Q3 and over 5 years' time. Current assets is $38.1 million compared to $32.8 million, mainly inventory, that is $16.8 million, and trade receivables of $19.8 million. The cash is now $3.1 million compared to $5.1 million last year, and it's down $6.8 million from last quarter. That is mainly related to a dividend of 5.7%. We have available credit facilities of $7.4 million, and we are comfortable with the current cash levels we have. The non-current liabilities is 0.4% compared to 1.5%, of which lease liabilities is 0.3% and borrowings 0.1%. Current liabilities, excluding deferred revenue, is 12.5%, and it's mainly trade payables, tax liabilities, and personnel-related liabilities. We have a deferred revenue of 10.7% compared to 6.8% last year. The working capital amounts to $15.7 million compared to $17.3 million last year. The inventory has increased to $16.8 million from $14.6 million and was $14.9 million in the last quarter. As I mentioned, we see an FX impact here of around 5% and the additional product parts we have to support the tariffs situation. We have an ambition, of course, to keep the inventory on a low and stable level, and we are not satisfied with the current levels, but are as usual monitoring and working with the levels. Despite the high levels, we see a very low risk with the inventory we have on hand. Trade receivables increased to $19.8 million compared to $17.2 million, up from $18.4 million last quarter. We have had good collections in Q2 and high sales end of the quarter. The trade payables increased to $7.7 million over $3.1 million last year and is related to high purchases late in the quarter. We have the 60-day payment terms in general while we build up these levels. Net other short-term liabilities increased to 13.2% over 11.5%, mainly related to increase in deferred revenue. We have a small portion of tax liabilities of 0.2%. Thank you. Back to Magnus. Thank you very much, Stefan. Okay. As I mentioned in the introduction, today we have been working as we normally do in the spring, renewing our strategy, our strategic ambitions. What is different this year from previous years is that we have started to model out what this will look like in the next slightly longer period, 2026-2030. You will see here that we have a number of new, very, very interesting new growth drivers that we want to introduce as a day-to-day priority in the company to continue this journey going forward. Of course, we are going to focus on our core business and expand our core business very much in the same way that we have been working with that over the past years. This is related to a focus on our traditional network and data center operators, government and defense, and enterprises becoming more and more relevant there, increasing our traction. The applications remain data center to data center communication and metro and regional networks. Primarily in the business area optical devices side, we are now starting to look at new and scalable go-to-market models. We have a palette of alternatives in front of us that I think will be very positive. The first part of the new strategy on business area devices was mainly related to looking inwards. How can we improve how we deliver products to customers and what products we are delivering, etc., etc.? Now it's time to start looking at how we can scale revenue through more scalable go-to-market models. There is an element of strengthening and expanding the core of what we do. What we have identified this year is really a number of new growth drivers where three of them have come a very long way, and we already have a focus on those. Those are committing to the majors. I talked in Q1 about us dipping our toes in the Tier 1 segment. We're now seeing that we can win business with even the largest accounts on the planet in the quarter with the order from a hyperscale organization. In parallel, we are also working with a couple of new, very, very large accounts looking at how we can meet and exceed their expectations. This is related to our products, but it's also related to the company as such, how we conduct our business, what certifications we have. There is a lot of work to be done here. I think to name one area that I believe is going to be instrumental in any business we do going forward is, of course, cybersecurity. We have a good and solid cybersecurity framework in the company. However, we have to certify ourselves towards ISO standards and other standards to prove this to customers. It's typically such an area where we have a little bit of work to do, but there are other areas too. Really committing, preparing the company, preparing ourselves, preparing our products to be a relevant player for the largest customers of optical transport equipment, data centers, hyperscalers, and network operators is a work that I'm really looking forward to leading the team through, and I have very good hopes that we can do it. If we go to the right there, leverage software automation and AI, this is probably the most important piece of our 2025 strategy work. AI is many things to us. It is a massive contributor to the underlying demand for the company's products and the demand for bandwidth. We're seeing that that will only increase as we go forward. That's number one. Number two, it is an opportunity for us to create new revenue streams in the company. That's within the SoSmart platform, and it's outside the SoSmart platform. These are new softwares and new ways to deal with data that ultimately helps our customers to optimize their OpEx. They are prepared to pay for that to us for those types of tools and that type of data. That's number two. Number three is, of course, the internal efficiency that we can do as a company to drive profitability and to become a leading player here. I'm not talking about creating a small AI team of architects working in their corner with their things. I'm talking about creating an AI-driven company across all functions, across everything we do, and quite frankly, across all the people in the company will be affected by this. I think this opportunity has never been there before. I'm sure many of you have heard other CEOs talking about requirements going up as you approach, as for instance, $100 million. You need this. You need that. I'm confident that by using these types of tools, becoming more data-driven, we can avoid falling into any OpEx rat hole that we would have seen in front of us several years ago. The potential is really large. We are a company that can do this. Not every company will be able to do this because you do need skills. You do need to have the right software people in the company who can lead this transition. Smartoptics is very well positioned with the competence we have within the company. My belief in this is rock solid for the future. The third area that I talked about a little bit earlier is expanding into new geographies and really expanding our efforts in certain geographies. I have talked about Asia, how we have seen traction in certain markets and where we are now talking to larger and larger accounts about more and more projects and deals. Africa is also interesting. We have, in the first half of 2025, delivered networks in South Africa, Namibia, and Kenya. There is a growing demand for internet services, for data centers. We're seeing peers in the market, internet exchanges and operators putting huge efforts into certain parts of Africa to capture that growth. We are going to do the same. I will remind you that as the world is to a large extent driven by hyperscalers building data centers, the alternative to build networks with Chinese equipment is way, way smaller today than it was 3, 4, 5 years ago. Smartoptics can be there as a really interesting alternative to African customers to scale their networks to meet the demands. That's interesting. South America is another market where we have seen a lot of traction in geographies like Mexico, Colombia, and a few others. South America is a big market, and the same type of phenomena is happening there, which puts us in a much better position to capture new revenue and new business today compared to only a few years ago. On all those three, we are well on the way. We have started initiatives in all of those areas, and we will continue to invest and to work hard to materialize that. The last one, M&A, to explore M&A as a vehicle for additional growth and accelerated growth, that's an area. I've learned that when a CEO talks about exploring M&As, the expectation is that you have candidates lined up and that an M&A is imminent. That is not the case in Smartoptics. We will do that in the same way that we do everything in Smartoptics, namely create a plan, scrutinize the plan, improve the plan, and then execute on the plan. This will take a little bit of time. The difference in mindset now compared to a year ago where we said that nearly everything in our business plan is related to organic growth is huge. We want to start looking actively at this as an opportunity for the future. All in all, this is all about gaining market share and creating new revenue streams for the company. We are setting new targets on ourselves to double to triple our market share in relevant markets. We are, as you know, addressing a next-generation optical networking market consisting of metro optical networking and IP over DWM. It's about a $6 billion market. When we work a little bit with those numbers and remove the things that we believe are out of scope, it is still a very big market that is growing at a very healthy pace. We want to double to triple our market share in the relevant markets. Right now, here and now, when we look at this, it means roughly somewhere taking 2025 revenue and probably a bit more than doubling it and a bit more than tripling it. That's the sort of numbers that we come to when we do our mathematics. We also want to maintain our EBIT target going forward to measure ourselves against mainly EBIT margin. We want to stay with our 13%-16% EBIT margin goal. This is, of course, driven by the scale of the company to a large extent. As you see, for instance, in this quarter, when the revenues come, we are also more profitable. It's also related to building a completely different company in the sense of using data, using automation, and using AI as key tools to drive profitability in the company going forward. I'm very enthusiastic about that opportunity. We will talk more about this as time goes by and hopefully clarify the arguments and explain more in a deeper way and better what we're doing in all these areas. Stay tuned for that. It's going to be a story that will develop from now on into the future. With that, I would like to hand over to Mr. Per Burman if there are any questions. Yes. We have our analysts on the call. If we start with Christoffer Wang Bjørnsen f rom DNB Carnegie, if you can unmute yourself and ask your questions. Yes. Good morning. Thanks for taking my question. A couple here. You said the tariffs at the 2% point impact on the gross margin in the quarter. I think you said in the past that you would take it now and then you would kind of make it into the price going forward. Does that mean we should kind of see an incremental at the size of the gross margin percentage points into Q3 and onwards? I would say potentially, yes. We started that journey early in this quarter or rather late in Q1 to build in compensation for tariffs. As you know, we're doing it in a couple of different ways by changing prices, changing discount levels, and so on and so forth, even charging for tariffs in some cases. I think, yes, you will see an increasing effect of those efforts going forward. Two quick ones on the OpEx side. You highlighted the exposure to the SEK and the NOK versus the USD and stuff. I'm just like your average headcount was up 10% year-over-year, but your OpEx was up almost 27%. Is that just the currency effect movement, or have there been any other kind of non-underlying or non-recurring elements driving the OpEx level up a lot more than the headcount growth in the quarter? I can comment on that. As I said, we have 11% is growth-related. 14% is average cost per employee-related. Those 14% we can break down into 4% salary increase, annual salary increase, 4% is FX-related, and the main driver is the sales commission part there as well. In this quarter, we also had more marketing expenses than we had in Q2 last year. Last year, we had some hits of marketing in Q3 instead, which I foresee was the top in Q2 now. All right. Thanks. One final quick one for me on the hyperscale win. Congrats on that. It's exciting. Can you add a bit on what kind of made you call out this being kind of a part of the organization or like a subsidiary of the hyperscaler? I understand that this is kind of a it's coming. The order is coming from hyperscaler. Is this kind of not part of their public cloud offering and more something internal? What makes this kind of different? What kind of growth do you say that this is related to a subsidiary, so to say? Yeah. No. The application is, as I said, a bunch of data centers and a lot of data center interconnect using our most modern products and 400 gig in our software and service offering. It is a software product that they are delivering. It is not the main cloud infrastructure of the hyperscaler. As you point out, the order is coming from that organization, meaning we have gone through agreeing on the terms and conditions, code of conduct, etc., with the hyperscaler procurement organization. In theory, we are now, or in practice, we are now a supplier. We shall see what this means going forward. As you know, Christoffer, the hyperscalers are very large companies owning a lot of related businesses. I'm sure there is opportunity there. All right. Thanks. I'll jump to the back. Thank you. Perfect. Thank you very much. We have questions from Markus Heiberg at SEB as well. Thank you. I appreciate the longer-term perspective on the new targets. Of course, it was quite short-term in nature, 2026, but that's a year ahead of us. Has your confidence changed on 2026 over the past few months? Should we still think of $100 million by 2026 as a target? How has your confidence changed? No, it hasn't changed at all. I will repeat what I've said over the years. The reason why we haven't changed it is that we feel that the opportunity to reach it is there. The opportunities are out there. It's a question of speed and execution more than anything else. If I may go back to what I said about the last three quarters and particularly the order intake that we have seen, you can see that, okay, we are not there. Absolutely not. We're kind of closing in on it in a very solid way, in my opinion. No, we haven't changed at all. Of course, we did have the four bad quarters from Q4 2023 through to Q3 2024. That has, of course, added some time onto this. We remain confident that we will reach this target. I mean, internally, of course, we have it as a near-term target. That's good to hear. Yeah. Thank you. Moving on to your new target, I think you mentioned that if we 2-3x your 2025 revenues and a bit more than that, then we will sort of get to the number that you are aiming for if the market develops as you think. You also mentioned here in your slides that Cignal AI expects 6% annual growth. Obviously, if it 2-3x something that's growing 6% per year, I would get to a higher number. How do you reconcile that? Does it mean that your relevant markets are expected to be more flattish than the overall market? How should I think about this? Yeah. When we do our mathematics here, we look at a little bit more details. I'm sure we will continue to develop our thoughts here and come with more and better data. The main difference is if you look at the growth in our market, there is a large element of hyperscalers growing their internal networks. I think in that business, there are things that are not addressable to us. For instance, in theory, we can very well sell our line systems into a hyperscale organization. We feel we have products that should be relevant for them, if not now, then in a couple of years. It is more questionable, as an example, whether they will buy optics from us. They probably won't. It's a completely different business model where even some hyperscalers are talking about building their own optics. The same goes for software, certain parts of the software that is a no-brainer for a Tier 2 data center to use, but not necessarily in the bigger hyperscale environment. That is the reason, I think, why we need to be a little bit more into the details here. As I said, I promise we will come back with an updated view of this. We just want to set the scene here and now that the end goal of Smartoptics is not $100 million. For that matter, the end goal of Smartoptics is not two, three times the market share. It's higher than that. We have to do something in the midterm here to have something to steer against and to take our decisions upon. Thank you. A short follow-up on that, because if Tier 1 hyperscalers seem to be a bit out of scope, you announced now a global hyperscaler. Is it fair to assume that this is a Tier 1 hyperscaler, but with a Tier 2 application? Is that the right way to think about this win? I have never thought about that in that particular way. I mean, we have products that can be relevant for a hyperscaler, but it's not all our products for sure. Yeah. That makes sense. The final one for me is just on how we should think about the rest of the year here. Of course, the seasonality, typically Q2 is a very good quarter. It should be a bit slower maybe into Q3, or rather that we are in now a recovery phase, that Q3 could actually be better than Q2. After we think about the seasonality, it's the final one for me. Generally, Q3 is a weaker quarter than Q2. There have been some exceptions over the years, but I think you should expect, I mean, Q2 and Q4 are the big quarters typically. We are very early into Q3 now, so it's very difficult to make any good estimates even for us. What we can say is that compared to 1 year ago, and given what I said about order backlog, of course, we have a much better, sorry, order booking, we have a much better backlog now than we had a year ago. This is also a number that we typically don't talk about, but it is significantly better. It feels good, but it's too early to give details. Thank you. Okay. We have received questions on the portal. We have four questions from Øystein Spetalen. The first one is about M&A. When evaluating M&A opportunities to accelerate scale, what are the quantitative criteria for an acquisition specifically in terms of revenue, profitability, technology synergy, and market share? How will you mitigate integration risk to ensure that an acquisition actually contributes to shareholder value, given that many M&A transactions historically fail to create value? Thank you for the questions. Those are extremely relevant and probably two questions that have kind of led us in the past not to think so much about M&A. I'm confident we can do it. We need to do a plan. We need to thoroughly make up our mind on what is it that we really want. The first question was kind of indicating to me that we would just go and buy a competitor. That's not necessarily the case. We will look broader at M&A. We will look at bolt-on technologies and other segments, as for instance, in the software area to continue our efforts in AI automation and so on. I think those questions are precisely what we are going to work on now for a while and then start to talk about. Good. The next question also from Øystein is, you pushed $100 million targets forward by 1 year. What has fundamentally changed in the market since you last gave this forecast that we should now trust you to revise ambition to multiply market share 2-3x and aim for a 13%-16% EBIT margin? What specific risk factors from the past have you eliminated, and what is the actual detailed roadmap to achieve these new targets, especially given a market CAGR of only 6%? I think what has changed, if we start there, it is really very obvious that we had a period from Q4 2023 through to Q3 2024 where we saw clearly that no large investments were happening in our industry. That affected us, I would have to say, in a minor way compared to the peers in the market, especially if you look at the smaller peers in the market. They declined much more than we did. It was a market phenomenon related to macroeconomics, things like higher interest rates and inflation and so on and so forth. We have since three quarters now seen a return to growth roughly at the same level as we have had in the company for well over 5 years ahead of that bad period. That is the reason. When we look at what has changed in a positive way, I think then we have to to Smartoptics and look at the customer dialogues that we are conducting right now, the customer traction that we have had over the past years, including this quarter with the major win that we have just discussed. I can assure you, if you knock on the doors in Silicon Valley at the hyperscalers and similar organizations, and assuming that you meet the right people who are involved in this type of business, they will who Smartoptics is, and they will know what we do, which was not necessarily the case when we set this target. Please also remember that this target was formulated in 2021. Actually, it was formulated a few years before that, and we called it our [BHAG] at the time. On the negative side, what made it take a little bit longer, I would say a period in the history with low growth in the industry and in our market. On the positive side, Smartoptics traction and also the vast broadening of our product portfolio making us relevant for way more applications in bigger and more advanced networks. That is what you see on the positive side. When it comes to why should we grow to these numbers in a market that is only growing by 6% per year, I think I will also refer to the past 6 years. If you look at our average growth versus the market, we have clearly gained market share over a very long time. Let's see now when the market share numbers come out for 2025. We typically report this once per year because one quarter is a little bit too bouncy to talk about. I'm confident that we'll continue. That is really my strong proof points. Our traction in the market, the way we are known today versus a few years ago, and the products that we offer. Good. We have a tariff question. You claim the tariffs are impacting margins by approximately 1% in Q1 and 2% in Q2. This is a significant negative impact. What concrete measures have been implemented beyond passive absorption to reduce this tariff burden? What is the expected residual tariff impact on margins in the second half of 2025 and 2026? The measures that we have taken, the big one is that we have transferred, and this is related to the optical device side now that I'm talking about, the 18% of our revenue where we have had a significant part of the portfolio being made in China. We have transferred that out of China. We're not quite done with that yet, but we are very, very close to having an alternative set of products that are made in Malaysia, Thailand, or Vietnam. I think that initiative is more important than the tariffs because eventually, it doesn't really matter what tariffs are put on these types of products. They are needed. They have a growing demand for bandwidth. It It will not go away. I think the bigger geopolitical hesitation from our customers in the U.S., in Australia, in parts of Europe, and in places like India to buy non-made in China is much stronger than the tariffs. This makes sense for the long term to use other geographies for production of the optical devices. There is no doubt on that. That's a big one. The other big ones are simply increasing our prices. We have different ways to do that. We have the discount sandbox that our salespeople are allowed to operate within. We have elements of new pricing, of course, as a result of this, new list prices. We have situations where we are charging tariffs as a line item to certain customers. The idea is that we should go towards zero fairly quickly here, impact of the tariffs. I'm sure that will not happen in Q3, but certainly in the slightly longer run, we should see this coming down to zero. It's a little bit difficult to measure also because in Q1, we had very little compensation. All of the actions that I talked about were negligible in Q1. In Q2, we had come quite a long way with the tariff compensations. It's harder to measure the tariff compensations than it is to measure the increased cost of the actual tariff. It's a little bit difficult to track. Okay. We have the final question from Øystein Spetalen. It's about AI. You praise AI for efficiency and new revenue. Given AI's history of significant investments in both capital, expense, and time to reach maturity, what is the concrete ROI calculation for the AI effort? Detail down to which line in the P&L the AI benefit will actually appear and when. What existing resources are being allocated away from other areas to fund AI? How do you ensure that this does not just become a new unsatisfactory cost item before real value is created for shareholders? Okay. I will start with the second part where this initiative started about 1 year ago when we formed our AI architecture team. It was very small at the time. It was really one person that we moved out of the regular R&D to focus 100% on the broader question of AI in the company. What we have done since then is a series of workshops involving about 20 very influential people in the company to build a roadmap for internal tools, external tools, monetization of AI, and a few other areas. Remember, an important part of AI is to have control over your data and also to produce, in our case, the data that is required to have any benefit from AI. This is how our products are streaming telemetry information to the users as an example. The next step for us is to take this broader group of people, first of all, to use our architecture group, which is bigger now, to create the frameworks for us on how do we develop our AI tools, backend, frontend, and UX, and then to distribute that among a much broader set of users and developers in the company. Where are you going to see the shareholder benefit of AI? I would say in two places primarily. Number one is going to be our ability to grow OpEx slower than revenue and, yeah, to grow OpEx slower than revenue going forward. That's number one. Number two, you will see the share of software and service revenue growing in the future versus solutions and devices. Thank you. We have two questions from George Leaasjø] The first one, it's a little bit long too, regarding midterm targets, do you have an explicit gross margin target baked into your corresponding EBIT margin? Regarding geography, is it always large variation in revenue from quarter-to-quarter? Should we see the lower growth in regions outside Americas as any consequence of your internal prioritization of revenues? Did the sales outside Americas simply reflect the market and your underlying business activity and normal lumpiness? When you talk about record order intake, how was that distributed between customer groups and geographies? Okay, can you repeat the first part of the question there, please? Regarding midterm targets, do you have an explicit gross margin target baked into your corresponding EBIT margin? Okay. Thank you. No, we don't. We will move over to measuring EBIT and reporting EBIT slowly now. Of course, we will report our gross margin. We have not set any new expectations on gross margin, but we have our old efforts and continuous work to keep gross margin high. Having said that, we also have an ambition to win larger and larger and logging deals. We want to have a little bit of flexibility on the gross margin side to do that, to be aggressive, and to act as the challenger in the market. Therefore, we are a little bit cautious with setting targets on that. We understand that it's very, very important, and we put an awful lot of focus on it, and we will continue to do so. The second part of the question, I think, was related to... Per, remind me, please. Yeah, regarding geographies, there's always large variation in revenues between geographies. Yes, we have had large variation. This is, of course, the largest variation we've had over the years. Yes, on both there, I would say there is always an element of where we prioritize our work and where we choose to focus deliveries, etc. We always have an element of that in every quarter. It is also where are the big projects at the moment and where are the projects happening at any given time. That goes a little bit up and down, as you have seen over a very long time. We have both of those elements affecting us. Good. The final question on the portal. Where do you see the number of FTEs developing the coming 1-2 years? I'm sure we will grow in FTEs. We're going to do that with an ambition to be considerably lower than the revenue growth. What we have learned as we have worked through our strategy is that it really makes sense to take every OpEx decision and measure that against efficiency improvements, how we can use automation, how we can use agentic AI tools, and really be careful about and thorough in that investigation. Going forward, every new recruit will be measured against other initiatives that can increase efficiency in the company. Way more attention to that question. As I said, I'm sure we will grow. There is also an element that when people appear on the market that we are very interested in, we may strategically choose to take them on board because it brings us value. Perfect. That was the last question from the portal. Thank you very much. I wish you all a great summer and see you again in a quarter. Thank you. Thank you. Take care.