Joining me today is the CEO of Gapwaves, Jonas Ehinger. Welcome, Jonas. Thank you, Jonathan. It's great to meet you. To start things off, I was thinking that you could briefly describe what Gapwaves do. Gapwaves is an innovative antenna technology company. It's based on research conducted at Chalmers University of Technology. The company was formed 12 years ago. Right now, our main focus is in automotive radar. The application as such can be used in other areas also. I'm sure we'll talk more about that later in our conversation. Yeah. What makes your technology unique in this context? Yeah, it's a different form of a waveguide antenna, and it maintains the performance, very high performance of waveguide antennas. In comparison with traditional waveguide antennas, it also has advantages in terms of simpler mechanical construction or requirements on the mechanical construction, which is especially suitable for high-volume production. We can also utilize more cost-effective materials and assembly methods, so it's easier to use a waveguide antenna, but still have the performance of a waveguide antenna. Okay. Why would you say is the technology needed today? Which trends are driving the development, so to speak? Yeah, there are some very strong trends, especially in the automotive segment. In automotive, for instance, personal cars, the market for automotive radar is growing close to 30% a year right now and will do so in the foreseeable future also. Of course, automotive radars, each radar sensor needs an antenna to work. With the promise of waveguide antennas in terms of performance, but also size and cost benefits, this is a very strong area and focus for Gapwaves now, of course. Mm-hmm. I also want to add that we often talk about automotive, but that is not necessarily only personal cars. It can be pretty much any type of vehicle that moves around, in various types of environments, on roads, public environments, et cetera, but also on non-public environments and other types of vehicles that transport or lift things, trucks, what have you. Eventually, also flying vehicles, which I'm thinking of, in terms of last mile delivery or drones, et cetera. I'm sure we've all heard about that on the news. Yeah. Yeah, you're talking about that in your latest report, that end-to-end radar system in mobility is something that is expected to grow and where there is a lot of money to be made also from your end. Yeah, because those systems, they need perception of their environments, and to accomplish that perception, they need sensors. There's a range of different sensor technologies, but these sensor technologies must be used in parallel because they complement each other. There's a lot of promise in various market segments. Now, you mentioned mobility, but we also have static segments, where radar sensors can be used for monitoring traffic or monitoring presence around a building or at a certain facility. It can be used for surveillance, for instance. Even at railroad crossings, you can replace cameras with radar sensors, with the advantage of radar sensors being almost not sensitive or very much less sensitive to optical conditions, meaning weather or dirt on the lens or sunshine that disturbs the camera function, for instance. There's a lot of very interesting and highly potential, or market segments with high potential. Talking about trends, I guess your growth and your future growth is somewhat dependent on the rollout of 5G here. Could you just comment on that? What happens in that area and where you stand in that respect? Yeah. Thank you. It's a question we often get, and I would say that the automotive segment and the segments I just described, where radar sensors can be utilized, is actually of higher relevance, higher volume, and much stronger growth than the 5G represents for us currently. The reason is that 5G is still utilizing low-frequency bands, and a vast majority of 5G that we have available worldwide is on lower frequency bands, typically in a range of 3 – 6 GHz, and that's not a millimeter wave range. Which means that waveguide antennas doesn't really, you know, add any benefit compared to traditional PCB-based antenna technology, for instance. There's a few kind of small networks in North America and South Korea with higher frequency bands, but they are really small. The industry, the telecom industry, has really solved or been able to address the telecom users' needs for capacity and bandwidth and data speeds, et cetera, with current technology or kind of upgrading current technology, and have not needed to invest in brand new equipment and new base stations, et cetera, utilizing new antenna technology. I'm sure we will see that in the future. Maybe not even with 5G. Maybe it will be called 6G then, but certainly it will happen. It's a question of when. The most important market for Gapwaves is really the radar segment and antenna technology utilized in the radar segment for various types of applications, as I mentioned. The markets you're addressing here, they are huge markets, of course, with great potential, but that also means typically that there is a lot of competition. Where do you see competition today? Yeah, we have one competitor, I would say, which is kind of out in the market competing with us. It's a Swiss company. They are. They don't come from the technology side. They're more of a producer who have learned to produce waveguide antennas. We have some advantages, and we also have equal amounts of engineering as they probably do, and they come from more traditional antennas. In Gapwaves, we have very strong knowledge of waveguide antennas and gap waveguide antennas. The trend in the market is really to move to higher resolution radar sensors, and that means more complex antennas and bigger antennas, and I think we will have a very strong advantage compared to our competitor and other competitors as the market moves to bigger antennas for higher resolution. Higher resolution in a radar sensor means that it can either see longer or, and/or with greater detail. That's really required from the industry when it comes to automotive to deliver the autonomous functions of self-driving, if you want. Also in these other segments, you know, a truck in a harbor or a last-mile delivery, kind of delivery pod or whatever you wanna call it, will have to distinguish very small and static things in its environment. For instance, the edge of a sidewalk or, somebody left a small, you know, bicycle, on the side of the road, that little pod needs to be able to detect that. That means high-resolution radar sensors. The entire market is moving towards that in the coming few years. This is also why we wanted to be ahead of the curve and made that investment in Sensrad, which was announced a couple of weeks ago. Sensrad is totally focused on imaging radar sensors or very high-resolution radar sensors, utilizing our antenna technology, of course. In terms of protection, how can you protect your technology from being competed with? That's also a very good and important question. We are spending a lot of time, and also money, on our IP and patent portfolio, and not only developing new patents but also assessing the patent portfolio and the patents we have versus potential competition and other patents that we see coming up and also versus other technologies. We've also expanded our patent work and intellectual property work from not only technology as such, but also to the production and manufacturability of our products. We protect not only the antenna construction in itself but also how to produce it and with what materials and what equipment can you use when you produce the antennas. Those things will be more and more important. Like we said in the beginning, this is a big market, and it's growing a lot. That means, per definition, there will be more competition, so we are quite vigilant about this and want to stay on top of our patent portfolio, but also others. I wanted to dive in also into your business model because you have a number of key agreements and partnerships with major players like Veoneer, Hella, and Bosch. How will the revenue model look like in the future for these relationships? Yeah, currently, the revenues have been project-based. We design and develop antennas for our partners, and then successively, as the project moves forward, that antenna ends up in a production. The first large volume antenna production will start next year together with Hella for a design that we have developed for them. Same will be for Bosch. We have three types of revenues, essentially. One is, of course, license and on our patents. There is a technology, you know, fee to utilize our technologies, of course. We also, the design and the development work together with prototypes that we deliver. The big revenues will come when the antennas are being put into production. Lately, Gapwaves has steered towards becoming or being the supplier of antenna, not just delivering technologies and design work, et cetera. But we have a model where our partners or customers, they buy the antennas from us, and we either produce them ourselves or use external production partners, and probably a combination thereof depending on volume and type of antenna. As a client, you can choose to either work with you as a supplier of the entire antenna, so to speak, or using your technology within your integrated that into your own production? Yeah. Is that correct? Correct. I was thinking here, going forward, what do you see as the major milestones for Gapwaves and for investors to, well, to look at? I think as an investor, you should keep your eyes on the automotive market, traditional automotive, which means personal cars, essentially. There you have the super big volumes. There's like 100 million cars being produced every year, and each of those cars will have a number of radar sensors. You do the math, you end up with great volume. Market share in that segment is really important, and that translates into the number of tier one suppliers that we work with. That's a quite important metric. Now, there is another dimension in that because these suppliers have several generations of radar sensors going in the market at the same time. They have legacy systems, they have current systems, and they're already developing next generation systems. We're working in both dimensions. It's important with the number of tier one suppliers that we work with, but also for what and when these antennas come into production. In the other segments, outside of traditional automotive, I think it's really relevant for investors to know about the contracts that we can win there and for what segments, because those segments will move quicker than the traditional automotive. What do you see as the major challenges for you going forward? Scaling up is a major challenge. It is a challenge to win the contracts in the automotive, the timelines are quite long. We're talking about three to five years, you know, from concept to an antenna being put into production. Once you're in production, you know that you have a good number of years with very high volumes, and it's not likely that the supplier will change producer or partner for that antenna. There's both good and bad. You mentioned your acquisition of Sensrad, or your minority stake there. Should one expect to see more acquisitions going forward, or how do you look upon that? Possibly. Right now, we want to make sure that Sensrad, which we have identified as the entity with the most potential in the high-resolution radar sensor market, being able to address segments outside automotive. I think we'll focus on that, getting our antenna technology into that, and win contracts and partnerships in those other segments outside of automotive. It's also good to balance Gapwaves a bit, so we're not only reliant on the traditional automotive. We need some other segments with different cycles and different objectives, and often, a different price picture, if you want, also. A final question. three reasons to invest in Gapwaves, what do you say? Gapwaves has a very big potential, and we've now also entered into other segments than just automotive. Our antenna technology is unique, and it can be applied in various areas. Right now, radar sensors for automotive is really a focus, but there are, as I mentioned, other areas, and also our dear telecom segment, which many investors or shareholders ask about. That's truly a future opportunity. Once the market moves there, that's also an opportunity. But I think in the coming years, there's tremendous opportunity for growth with the current business. Jonas, thank you very much for taking the time, and good luck here going forward. Thank you. Thank you. It was nice talking to you.