Thank you everyone for coming, for joining this short Shelly presentation. That's my third time here in Las Vegas on this conference. Really happy to be here and I'm amazed how good this is organized here. Special thanks to Robert and the team. This is something where a lot of European conferences can learn a lot from. What is Shelly? For the newcomers, we are doing smart home devices. Building automation is the more modern world. It goes a bit wider than smart home, which is typically like switching on and off the light. This goes way beyond, and more and more energy management. Of course you can imagine as our home turf is Europe, energy management with the high energy prices is very important and essential, and we have a couple of really good solutions. How does this work? Very simple.
We have plug-and-play devices that everyone knows it. That's a simple plug that you put in the socket. You can connect whatever you want. You can switch on a heater or a light or whatever. It gives you an information about the energy consumption of this device. You can remotely switch on or off. You can connect this with a humidity sensor if you have a dehumidifier or a temperature sensor, and steer your heating system. We have devices that need wiring. These are the babies that you would typically install behind your wall switch. That means you take the wall switch out, you put such a device behind. This one is like $10, this one is $20, does more or less the same job. You connect the wires of your wall switch. You put everything back.
It connects directly to your Wi-Fi router, for $ 10, $15, $20, depending on what exactly you want to do there, this switch is smart. You can remote control it with your smartphone, with a remote control, physical remote control, with a motion sensor, a presence sensor, temperature sensor, whatever you want to do, and you can steer this remotely. We have, of course, quite popular in the U.S., wall displays that everyone here loves. In Europe, that's a product that is not that popular, but here everyone loves wall displays. We have three different sizes, a small one, a medium one, and a big one. That just started and is selling quite well. We have as well professional devices that you would install in a new build. If you build a new house, you would go in the central installation.
The others are more for renovations, we have more houses to renovate than the new builds, actually. That's a huge market for us. I already said our home turf is Europe. We do 90% of our revenue in Europe. We have a small subsidiary in the U.S. We get some visibility here. We are on Amazon, of course. We are close to signing with a big do-it-yourself chain. We had the talks already, we are finalizing the contract. That will give us more visibility in the U.S. Europe is where we are strong and where everyone who is in smart home business knows Shelly in all the countries. We are quite a popular brand. We are as well in China. Our factory is in China. We have an outsourced factory, not our own.
We have an office there that originally started to pay attention that the factory does everything right, China sourcing and all that stuff. They start to sell there, and our products are as well quite popular in China. End of Q1, we had our devices in more than 6 million households. We have sold a total of more than 35 million devices in total in the last year, since 2018 when we started the whole Shelly. Half of these users are using our cloud, and that's a big benefit of our devices, that they work with a cloud solution, with our cloud. They work with third-party clouds. They can connect to five clouds at the same time. They can work completely without any cloud connection.
If someone says, "I don't want to give my data to anyone," he's free to operate with his own cloud or without any cloud. Of course, you lose the remote control of your home from outside of your home. You can only steer everything in the home. All this works, and that's a big difference in architecture because the intelligent is to a big proportion built in this device. It's not in the cloud. It's not in a hub. You can install one device for $ 10, $20, make one room or one light smart, and then you can take it from there without big investments. No monthly payments or whatsoever. Having said that, no monthly payments, we start with a premium version of our app. We are doing this in a very careful way.
We expect EUR 2 million revenue from this this year, which is almost 100% profit. That gives more benefits to heavy users. Like you get the energy consumption on the minute exact. You get more scenes that you can create. You get more information about what's going on in your house, up to 100 different activations per day. We have all the data anyhow, so for us the cost is zero. We are very careful because paid versions of smart home applications are not very popular. For cameras, people are used to pay for storage and intelligence. For normal smart home, not. That's why we are very careful. We don't need to do that. You will see it in a minute. As smart home goes more in the mass market, and we are coming from the do-it-yourself business. We are 2018, we started as 100% do-it-yourself business.
People install that on their own. They are not afraid to touch wires. That's our typical customer. If we ask them today, 65%-70% of our customers say they do the installation themselves. 30%-35% growing use an installer because they don't feel comfortable doing that. That's why we started an onboarding of electricians, we have now trained in mainly in Europe, 6,700 electricians end of March. Currently, by yesterday, it was already 8,500. It's rapidly growing. That's people that are certified. They know how to install a Shelly. They come to your home. If they are asked anything about a smart home, they recommend Shellys. If we ask our do-it-yourself guys, "What is your knowledge? Why are you feeling comfortable to install it?" Most of them say, "We are engineers. We are electricians ourselves." That's the typically geeks, the early adapters.
Now the market moves in mass market. That's why we need more installation. Looking to the financial performance, we are growing. We are in a growing market. I come back to that in a minute. Last year, we ended with EUR 150 million revenue. We grew around 40%. We have an EBIT margin of around 25%. EBIT, not EBITDA. That's why I said as well, we are not depending on recurring revenues from the application. That's something that is on top that will be the icing on the cake for the future. If this doesn't work, we are in a very solid stage with 25%. The cash is our weak point, if you want, on the one hand side. On the other hand side, we have 90% equity ratio roundabout. We are net debt-free. We never paid attention on collecting our money.
We always have to prepay to the Chinese factories. We are quite generous with payment terms to our customers. That's a distributor that sells to a retailer. The retailer asks long payment terms. On top of this, we did not really pay attention. There's no risk in the receivables. Now we are paying more attention to get the money back, earlier back. You see already in the first quarter, first quarter we grew 26%. The planned growth rate for this year is a bit above 30%, and we announced from the very beginning that the main growth will come from the second half of the year. That has to do with the product roadmap, launches, country expansion, and a couple of other things. We already made a nice jump of 20% in cash in the first quarter.
We are checking the numbers now, we are calling customers, and some of them are surprised that someone calls and says, "What do you mean I have to pay?" That's quite an interesting thing. I will take that out. That's about the premium application. In the first quarter, we are on EUR 300,000 revenue. Once again, that's 100% EBIT, if you want. The target for this year is EUR 2 million. You see that we are growing nicely in number of subscribers, 44% Q1 to Q1. This is something we do very careful. We expect to have a good development for the future because we are adding cameras now. With adding cameras, that's what I said before, people are used to pay for AI functionality and storage. We expect that this continues going in a nice direction. We have an interesting network effect.
That means someone who has installed his first Shelly or his second or third Shelly, typically adds more Shellys every year. We are not a company where people buy 100 devices or ask their installer to install 100 devices in one shot. People start with a plug or with one of these babies. They try it out. The investment is limited because they don't need to buy a hub or have a heavy investment. They like it, and then they add an average two and a half devices per year. That means more or less, I already know that to our-- I only take the cloud users, to our 3 million cloud users, I will sell 6 million devices this year or a bit more. That's proven data from the last years.
We have as well, we have, of course, you can imagine, a lot of data from all our customers' energy consumption behavior and whatever you want. This is the product roadmap. In this year and in the coming years, we will add more product categories. I already mentioned the cameras. We have interesting things like the power strip. I have one at my booth. That's a very popular device. We will have one for data centers. That was a demand from one of our customers who said, "That's a great product. Why don't you make one that I can put in a DIN rail for my servers?" That's typical for us.
We made a voting on Facebook, asked our community, "Do you like that?" We said, "If you give us more than 1,000 likes until tonight, we will make a product." We had couple of thousand likes. That's like we've used our community as well for product development. We have a plug. This is a plug that is more an OEM product that we will offer to producers of washing machines and heaters. The Shelly solution is built in. It will be connected fixed with a cable of the device. A lot of manufacturers are obliged, at least in Europe, to deliver the energy consumption of their devices, and they have no idea how to do that. That's a cool solution for them. We started with locks, smart locks last year. Now we will have the entry versions, EUR 199 to EUR 99 selling price.
The current one is a bit more expensive. A lot of cool products to come. In the next years, it would take too long to go into details here. We will move a lot from our hardware platform to a software platform. We have finished our Fleet Manager. What is a Fleet Manager? With the current Shelly app, you can manage one house, one apartment. With the Fleet Manager, you can manage a hotel. A hotel with 100 rooms, where the hotel manager wants to see the energy consumption of the whole hotel, but as well the consumption by room, be able to remote control every room. Are the blinds open? Is the light on? What is the temperature in the room? At the same time, gives an application to his customer, to the guest, so that he's able to operate his room.
We have a good cooperation here with Alexa in a couple of hotels in Europe already installed, and we have some good projects to come because Alexa wants to put the Alexa in the hotel room. That's easy to order things. It's proven that more people order a burger to their room using Alexa than the telephone. That's quite interesting. What they found out is that they put in Alexa, the first thing the customer says is, "Alexa, switch the light." With this baby that is connected to Alexa, it switches the light, or it closes the blinds or opens the blind or steers the temperature. That's cool projects. Now with our Fleet Manager, we have an own solution, own software solution to do that. So far, we were depending on third parties that have this solution and connect to the Shelly devices.
We are doing a lot in energy management. We have one device that's an energy meter that you put in the central distribution box, and typically this is installed with a solar system in combination. What it does, it steers the energy flow of your solar system and the battery and the house, so that there is no waste of energy, there is no overproduction that you have to give back to the grid, and there is no under delivery, although it's a sunny day and your air condition consumes a lot of energy, but you have a fixed amount of energy that you give to the house, and the rest you have to buy from the grid. This device in seconds, in milliseconds, changes the behavior of the battery of the solar system and optimizes the output.
If you have more devices with an information that you have enough energy available, you can now switch on devices in your home, like the dishwasher, the washing machine, the air condition. Although you are not at home, you want to have it quite cold already in the evening without buying energy from the market. All this is possible. We are working. We made a first proof of concept end of last year in Germany, because we have all the information of our customers about energy consumption, and we know where they are, and we can offer tailor-made energy contracts to them. We did this with a partner, very low scale. Now we are thinking about, and we have a plan to do that, with a partner and to offer a Shelly energy contract to our 3 million customers.
We can tell them, "You would have saved X euros last year with your energy consumption behavior using this energy contract." Shelly X, that's the next level of development. We started the development of Shelly X in 2023, 2024. 2025 was the first proof of concept. 2026, we are more with European partners. What this does, it's basically the solution that is in here on a module, on a chip, that we offer to third parties to make their devices smart. We have third-party weather stations, we have heaters, we have car chargers, we have inverters, and now we go into garage motor producers. Hörmann, a German company, has a project with us. They want to make all their garage door motors smart and integrating that in the Shelly system. There are a lot of projects going on. That's a little bit, if you are familiar with Tuya.
Tuya is a Chinese company. They are doing nothing else than that. They have a chip that they offer to bulb manufacturers to make the bulb smart. The caveat here is that it's a Chinese company, a lot of governments, as well the EU thinks about, I know that, they want to ban Chinese communication chips because what does this mean? It's obvious that every Chinese company is obliged to deliver the data to China. This is illegal. In Europe, you are not allowed to do that. They say, "No, we are not doing that," of course they are doing that. Everyone knows that. That means that with one button pushed, China could switch off the whole energy production in Germany from solar systems, which is a big part. You can boot them again, but that would be a nice effect.
That is a lot of people. As well, American companies like Walmart, they start to ask about what is the chip communicating in this smart device? Is it Chinese? It's owned by Tuya, the market. They look for alternatives, we could be one of the alternatives. That's something that we see more in 2027, 2028, 2029 than now, it starts to prove that it's working, that is increasing our hardware platform, we can use this for selling our software services. Talking a little bit about the guidance and the future. We had a long-term guidance that we published at beginning of 2023 on the basis of 2022 numbers. EUR 48 million, we said in 2026, we will do EUR 200 million revenue and we will do EUR 50 million EBIT. A lot of people said, "You're crazy. Why are you doing that?
Such a long-term guidance. No one is doing that." Anyhow, you will not reach it. It's too ambitious. Now the same people say EUR 200 million is not ambitious anymore. You have to increase. We will not. We will make our EUR 200 million, we will make our EUR 50 million, now for the first time, we added free cash flow, the cash situation end of the year will be significantly improved versus the last years. Once again, we never had a focus on that. We always looked to the bank account. Do we have enough money to pay our invoices and the employees and everything fine? Whenever the money comes, it comes. There is no risk. We have an insurance for the receivables, now we are collecting faster and have an eye on that as well. I leave that out. What happens then?
How do we see the future? 2026, let's say the year is over, we did our EUR 200 million. We are in a market that is, I would say that now in this moment is mass market. It starts to be mass market. Yesterday it was not. Why is this for me the edge? IKEA, the furniture company, they started with smart devices. They are not our enemy. That's a market that is not reachable for us. They have smart bulbs. If you ask me, they will kill Philips Hue, because Philips Hue is five times more expensive than IKEA. We as well have a smart bulb, very small proportion of revenue, same price as IKEA, they are not our enemy. They are stimulating the market and that helps us. This is mass market now.
The market is supposed to grow in the next years, that's data from Statista, I always have problems to Statista. It's not 100% accurate. If you ask other market research companies, everyone says the same. The market is supposed to grow 10%-15%. We have tailwind from the market. We are not fighting an uphill battle. That will help. Let's say we do nothing. People in our headquarters, they've almost beat me for saying our do nothing scenario. If you stop working tomorrow, we will grow 10%-15%. Of course, that is not true. We have to renew our products. We have now generation 4. We will have generation 5 of the existing products in 2027. We are continuously ahead of the market with much more features than anyone else. We have a regional development.
I said that Europe is 90% of our revenue today, but 50% comes from the DACH region, Germany, Austria, Switzerland, and we are improving revenue in other countries. We have put teams on the ground now in a total of eight European countries. Four we added beginning of this year. Before that, we had four countries. In every major country we have people, and of course, having people there means we need to grow more than the market. Otherwise, why would we put people there? That doesn't make any sense, and we see that this pays back after a period of six to nine months. That means do nothing plus regional expansion is the revenue 2030, and I will not put a number there. That's what you can do. You can believe in 10%, 15%, 10% market.
You can believe that we grow and continue growing two times as fast as the market or three times as fast. Your job. You can imagine that the numbers, the development that you saw before, there's no reason why this should not continue. Beside this, you have seen a couple of new categories that are launching this year or that launched last year that are at the very beginning. We go massively in HVAC, heating and cooling solutions. We go in security products with cameras and locks, access control. We have smart circuit breakers. We are the 1st company with smart circuit breakers. That means the circuit breaker in the box that is a dummy product today will be intelligent tomorrow. Will deliver you the energy consumption and the status, and if there's a problem in the line, it will give you the feedback as well.
We have the software developments that I talked about, and that will deliver our 2030 numbers that, of course, we have an internal plan that is very detailed, but that we are not sharing. We will now come with year-over-year guidance and not three, four, five years anymore because people told us that we are stupid doing so. We will not do that anymore. That's my last chart. There are a couple of more in the appendix if you want to look in the presentation or just download from our website more data if you want. Do you have questions?
Can you talk a little more about what you think you're going to do in the camera space that's going to be-
Yeah
-interesting?
That is a very good question.
Yeah.
You could say, "Why do we need one more camera? Come on, there are thousands of cameras on the market." The idea is not to have a camera that has extremely more features than anyone else. The question is, how good is it integrated in the Shelly environment? That is the beauty. That's what people love. They have the application. It's easy to connect devices, and it's as easy to connect a camera with your door lock, so it recognizes your face and the door is open when you go there, and you don't need to have your smartphone with you to unlock the door. Or to open the garage door if the number plate is read. Or to verify another information from a different sensor. The smoke detector detects smoke, the indoor camera checks is there really smoke or is it a false alarm?
That's kind of the things that really make sense. We have a big community. We have hundreds of thousands of people, Shelly fans, in the community, and all of them tell us, "We need a camera. Give us the camera." We will have an indoor camera, we will have an outdoor camera, we will have an AI camera, we will have a door camera. Everything that you need. We will not fight against other camera manufacturers. It's just an addition to the existing Shelly network. This is, in any case, this is a big differentiator, that our devices are super intelligent. They are relatively cheap compared to the market. If you compare with Bosch, ABB or other normal well-known brands, we have 50% of the price, 30% of their price.
Compared to the Chinese, we are a little bit more expensive, but not that much. If this device is EUR 20, the Chinese is EUR 15, and Bosch is EUR 60. Other manufacturers in Europe as well. We have a very good price. But the intelligence, we have 10 times more features than anyone else in the market. Every device communicates in a very simple way with every device. I don't want to overload this with technology. We are KNX compatible. Every professional big system can talk to a Shelly. Other questions?
On the camera, can you talk about the camera is going to get its own app, and do you need the app to use the camera or-
No. You need an app to see the picture.
Right.
Obvious. If you want storage, you need to store it somewhere. We have a camera that has as well a memory inside, so you can keep it. We will never force people into our application. That was never our philosophy. A lot of companies are doing that. We think an open system is much better. Our devices work with 250 different applications. If you want additional features, additional AI features, then you need to pay a small amount per month. That's kind of the idea. Yeah.
I'm a bit of a tourist in the smart home space. For instance, just the example with the IKEA bulb, it's built to my whole entire house is built to,
I'm sorry for you.
I'm just very curious though, because the product side, it seems like it eventually becomes pretty commoditized as the race to the bottom, and the catch-up is the software.
Yeah. That's the point. The hardware you see-- We were one of the first with these devices. You see exactly the same form factor. Even we have a color code. You see a copy of our color code from Chinese competitors. What they are not copying and not able to copy is the features. With the features, we are light years ahead of everyone else. Typically, to make it easy, I say we have 10 times more features than the Chinese, and we have 10 times more features than the European competitors that have three times our price. We are increasing because we have a very fast development cycle. We are increasing this gap. It's not shrinking. I talked about this is generation 4.
We have generation three in the market a bit as price fighters. We will come with generation five that will increase the gap once again. That is kind of the secret, that the software is super different. The way how we operate the cloud, the price points, we can hit these price points because we know how to operate as well the cloud service in a very price competitive way. We pay a fraction of what competitors pay for Amazon Web Services or Google services. I think we have to stop. There is a red flag coming from over there. I am at my booth when you have other questions.