Good day. Thank you for standing by. Welcome to the VusionGroup full year 2025 results conference call and webcast. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be the Q&A session. To ask a question during the session, you need to press star one one on your telephone keypad. You will hear an automatic message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Olivier Gernandt, VusionGroup's Investor Relations Officer. Please go ahead, sir.
Thank you very much, Nadia. Good afternoon, everyone, and welcome to our full year 2025 results presentation. With me today are Thierry Gadou, our Chairman and Chief Executive Officer, as well as Thierry Lemaitre, our Deputy CEO, Finance and Corporate. Thierry Gadou will start with some remarks on the group's business performance and operational highlights. Thierry Lemaitre will then make some comments on our financial performance, and Thierry Gadou will end the presentation with some comments on our full year outlook. After these remarks, we will be happy to take your questions. As a reminder, some of the information to be discussed on our call today is forward-looking and subject to important risks and uncertainties that could cause actual results to defer materially. For these, I refer you to the safe harbor statement included in our press release and on slide 3 of this presentation.
This evening's release was issued a short while ago and is available in French and in English on VusionGroup's website, vusion.com. The slides of this presentation can also be found on our website in the Regulated Information section. A replay and a transcript will also be made available on our website after the call. With that, it's my pleasure to hand you over to Thierry Gadou for his opening remarks.
Thank you, Olivier. Good afternoon, good morning, everyone. Thanks for joining our conference call. I'm very pleased to present to you, along with Thierry Lemaitre, our excellent performance for the full year 2025. First, in a nutshell, we delivered over 50% organic growth in 2025 and reached over EUR 1.5 billion in adjusted revenue, which was our target. Order entries reached EUR 1.7 billion, of 5% versus the record of 2024. VAS revenues doubled year-on-year to EUR 211 million, representing 14% of total sales. Our EBITDA increased by 73%. Our EBITDA margin improved by more than 2 points to reach over 18% of sales. Operating income and net income also rose significantly.
Our adjusted net income was close to EUR 100 million, with a very similar number for IFRS net income. Our cash flow generation was positive, and our financial structure is stronger than ever, with EUR 480 million in cash and only EUR 40 million in debt, EUR 41 million in debt. A strong balance sheet that gives us the means to pursue an ambitious growth and innovation strategy. After this exceptional growth rate in 2025, we are forecasting another year of growth, around 15%-20% in 2026, along with at least a 100 basis point improvement in EBITDA margin and a positive operating cash flow. If we look at the performance in a bit more detail.
Thanks to another fantastic Q4, we passed the EUR 1.5 billion mark in yearly sales, adding half a billion dollar or euro in just one year in revenue, and with a 10-year CAGR of 30% per annum in top-line growth, long-term trajectory. Regarding VAS, IE software services and non-ESL solutions, VAS revenues doubled, as I said, driven by the strong growth in both recurring and non-recurring services. In Q4, our VAS annualized recurring revenue reached EUR 105 million per year. Our cloud base install base has grown by over 200% in the last year, thanks to new rollouts, so new logos and legacy customers', accelerated migrations. We passed in Q3 last year, the mark of 50% of our total installed base now, fully managed in the cloud. Order entries.
In Q4, we booked over EUR 400 million of new orders. Our global order entries for the full year 2025 reached an excellent level of EUR 1.7 billion, up 5% over the record of 2024. The growth in order entries was concentrated in Europe, where several new logos were signed. If you're following, I'm not mentioning all of them, but if you follow the slideshow on the webcast, you can see them. Many new logos in the U.K., in Germany, in all throughout Europe in different verticals, and as well as obviously, you know, significant new orders from our large customer base, which is also a very strong driver of growth for us.
I'll come back on that. If we stay on the performance by region, revenues in Europe still shows a minus 16% decrease in the full year. The order entries have continued to grow. As I just mentioned, we signed many wins over the past few months. We continue. Growth will be back in 2026 and with a much diversified and balanced revenue structure, with a lot of VAS, obviously new logos, and as I said, an excellent momentum and high revenues from our existing customer base as they extend their store coverage. We still have less than 50% in penetration at our customer base as they increase VAS adoption, obviously, and as they begin to renew and upgrade their install base in the coming years to Edge Sense.
That's a big driver of growth. Talking about EdgeSense, obviously, the strong growth outside Europe is particularly driven by the intensive rollout of EdgeSense in Walmart in the U.S., which is now halfway through and running at full speed. The program is very successful and contributes to the impressive results of Walmart in the U.S., particularly to the stellar growth of in-store fulfilled e-commerce and to the improvement of the operational leverage of the company. This U.S. rollout should be completed in about a year in the U.S. We're working on several other solutions with Walmart U.S., which could become new rollouts for the coming years. We are also working intensively with Walmart on the international expansion of EdgeSense.
Obviously, this deployment confirms, on a very large scale, the performance and our excellent performance of our EdgeSense platform, which has no equivalent in the world today for optimizing productivity, speed, and accuracy in shelf management tasks, on-shelf inventory monitoring, and e-commerce fulfillment. We are proving that our platform enables much broader use cases and delivers much higher ROI than standard ESL solutions. We've announced in 25 a few partnerships involving EdgeSense, including DM, a major Germany-based Pan-European retailer, and of course, with Carrefour. I will come back in a minute on Carrefour. Several other EdgeSense pilots are on the way around the world.
Innovation has continued to be at the heart of our priorities in 2025, with a 20% increase in our R&D investments, advancing our powerful roadmap to make the store ever more efficient, automated, data-driven, omni-channel, and to turn the store and traffic into media dollars and to enable AI for both associates' efficiency and shopper experience. We've worked in 2025 on further enhancements on EdgeSense. We've worked also on new products around data, AI, and retail media. We've just signed in the past few months, a few first deals with our newest retail media solutions, that's a very promising avenue for Vision, as it's a top priority for retailers today. We've significantly worked and enhanced our Captana solutions portfolio, from agnostic computer vision to ESL synchronized solutions and mobile solutions.
We're achieving very promising results and are extremely confident on our technology edge in this field, in which we have invested heavily over the past few years. We see great traction. 2026 will be a year of acceleration of Captana. We expect to deploy over well over 150,000 new AI cameras this year. A perfect example of this overall momentum is the announcement of the Carrefour deal, because it is the first large-scale deployment in Europe of EdgeSense. Also the first large-scale deployment simultaneously of EdgeSense and Captana, our full platform.
This partnership is significant because, as you could all see, it's at the core of Carrefour's 2030 strategic plan, and also because alongside the digital transformation of Carrefour's hypermarket and supermarket, Carrefour and VusionGroup are creating a joint innovation lab and are going to collaborate on new solutions to invent the future of retail together. We'll see now if we can, and for those who can, a short video on, well, on this Carrefour announcement, which is fairly recent, even though it has been essentially a lot of work in 25. You all remember that we had announced our partnership in June, starting pilots, and then I will hand over to Thierry for the detailed financial figures.
C'est une première en Europe. Avec VusionGroup, leader mondial de la digitalisation du commerce physique, Carrefour fait entrer ses hypermarchés et supermarchés dans une nouvelle dimension. Bienvenue dans l'ère du magasin intelligent.
Nous sommes ici dans notre hypermarché de Villabé, où nous avons installé nos premiers rails connectés VusionGroup, c'est une étape importante dans la stratégie de digitalisation des magasins. Chez Carrefour, nous avons une conviction: le digital n'est pas une fin en soi, il doit avant tout servir les équipes des magasins. Nous avons deux enjeux: mieux servir nos clients et faciliter le travail de nos collaborateurs. Nous allons déployer ce réseau de rails connectés, équipés d'étiquettes et de caméras, avec trois objectifs très concrets: détecter les ruptures pour avoir des rayons toujours pleins, contrôler les prix sur les étiquettes pour assurer la cohérence entre la caisse et le rayon, et faciliter la préparation des commandes e-commerce grâce à la géolocalisation des produits. L'objectif est toujours le même: plus de prix, plus de plans, plus de propre.
Yesterday, we treated our shortages every day by hand. Today, we receive alerts directly on our TR, which allows us to stock the shelf immediately, handle the shortage, and free up time to better serve the customer.
After Walmart in the United States, Carrefour is the first retailer in Europe to deploy a next-generation vision platform on a very large scale. This partnership marks a major step towards the store of tomorrow, combining smart shelves, artificial intelligence, and computer vision for the benefit of customers and employees.
I will now present the results for the year 2025, and as you are now accustomed to, I will present the main financial items under IFRS and in adjusted terms for certain IFRS adjustments that impact the accounting for the contract with our largest client in the United States. The details of these adjustments are presented on the following slide. First, let's start by celebrating the excellent performance in 2025, with revenues increasing more than 50%, both in IFRS and adjusted terms, and standing at EUR 1,527 million in adjusted terms. The adjusted variable cost margin increased by 60% faster than sales and reached nearly 31% of sales, an improvement of 1.6 points compared to the previous year.
OPEX grew by 43% and represented 12.7% of adjusted sales, 0.7 points less than last year. This translates into a significant growth in adjusted EBITDA of +73% to EUR 277 million, which is an adjusted EBITDA margin of 18.2%, up 2.3 points compared to the previous year. Depreciation and amortization also increased significantly, mainly due to the last 3 manufacturing lines starting to get amortized in 2025, on top of the first line, which started to get amortized in 2024. Adjusted EBIT more than doubled, as EUR 164 million, reaching 10.7% of sales, up 2.9 points from the previous year. Overall, adjusted net income is close to EUR 100 million at EUR 98.7 million, or 6.5% of sales.
The following slide shows the main adjustment between the IFRS and the adjusted accounts. The nature of the adjustment has not changed and remained exactly the same as last year. 2 adjustments impact the revenue down to the net income, consisting of, first, the amortization of the fair value of warrants conditionally granted to Walmart. The first effect is directly proportional to the sales generated by Walmart. It negatively impacted the IFRS revenues in 2023, 2024 and 2025, and will continue to negatively impact the revenues in 2026. Second, the recognition in the IFRS accounts of a volume average selling price over the entire term of the contract. The second effect had a negative effect in 2023 and 2024, and started to reverse in Q3 2025. It generated, over the full year of 2025, a small positive effect, which will be even higher in 2026.
Financial income is impacted by 2 restatements, identical to those of the previous year, the first consisting of the revaluation of the fair value of the warrants. Given the average share price of VusionGroup over the last 6 months of 2025 compared to the last 6 months of 2024, and despite the decrease in the number of warrants remaining to be exercised, this fair value increased by EUR 7.3 million compared to December 31st, 2024, which translates into a financial expense of the same amount in the 2025 IFRS accounts. IAS 21 adjustment on the intercompany between the parent company and the U.S. entity also impacts the IFRS accounts by +EUR 48.7 million. These impacts, plus the different tax effect on these restatements, total the -EUR 14.5 million impact on the net income in 2025.
If we now go more into details, starting with revenues. 2025 showed a 51% revenue growth in adjusted revenue, driven by the Americans and APAC region. Given the volatility of the euro-dollar exchange rate over the year 2025, group revenues were negatively impacted for the portion denominated in dollars. A constant 2024 euro-dollar exchange rate, 2025 adjusted revenues would have stood at EUR 1,580 million, which is EUR 54 million more than our reported figures. VAS revenues increased twice as fast as group revenues at +100%, driven mainly by VusionGroup One-off revenues, but also by recurring revenues, which in Q4 reached EUR 105 million on an annualized recurring revenue basis.
On the following slide, adjusted EBITDA margin grew by 2.3 points of sales, mainly driven by the variable cost margin and more specifically by the revenue mix effect, and to a lower extent, by a lower OPEX to sales ratio. Despite a significant impact on sales, the euro-dollar forest impact was limited on the profitability. Financial income stood at EUR 29.5 million in 2025 versus minus EUR 60 million in 2024, before the IFRS impact that we presented before. The adjusted financial result was minus EUR 11.9 million in 2025, of which minus EUR 11.2 million has a cash impact. This minus EUR 11.2 million are mainly driven by exchange losses due to the high volatility of the Euro-Dollar exchange rate.
More importantly, the financial income, largely driven by cash investments, stood at EUR 17.5 million in 2025 versus EUR 4.7 million in 2024, thanks to a higher level of cash being invested, while the interest expense decreased from EUR 12.6 million to EUR 8.5 million, thanks to lower interest rates and the reduction in the group financial debt. CapEx. Total CapEx stood at EUR 137 million compared to EUR 158 million last year. EUR 77.5 million were invested in 2025 in the manufacturing lines, pre-funded by Walmart, and the last manufacturing line has been running at full capacity since Q3 2025. The 3 other ones started earlier in H2 2024 and H1 2025. We now have 4 lines running at full capacity.
Cash CapEx, corresponding to CapEx financed by the group, amounted to EUR 60 million in 2025 versus 1424, representing around 4% of adjusted sales. Let's now have a look at the cash flow and the cash situation. At the end of 2024, the group shows a positive net cash position amounting to EUR 439 million compared to EUR 393 million last year, which is a EUR 46 million increase. As mentioned previously, the operating free cash flow, defined as EBITDA minus CapEx funded by the group, grew in 2024 as well as in 2025 and should continue to grow in 2026. In 2025, it grew by 83% compared to 2024.
The free cash flow, the total free cash flow, was impacted by the increase of the operating free cash flow just disclosed, but also the consumption of the down payments collected. This negative impact will increase in 2026. The investment in the manufacturing lines that were pre-funded in 2023 and 2024, and by the tax expense of EUR 52.9 million compared to EUR 4.7 million in 2024. In 2024, the group still had tax losses, which could be used to offset part of the taxable income. There was a limited amount of NOLs left at the end of 2024 that the group could enjoy in 2025. This is no longer the case at the end of 2025.
On top of these elements, the group proceeded with share buybacks, some acquisitions, and collected EUR 73 million from the exercise by Walmart of part of their warrants. Also, to be noted, the Forex impact on the cash position in dollars, which is -EUR 45.6 million. To finish the financial presentation, the board decided to present at the shareholders meeting to pay out a EUR 0.90 dividend in 2026, which would be a third consecutive increase since 2024. That's it for the presentation of the 2025 financial results. I now hand over to Thierry Gadou for the outlook.
Thank you, Thierry. For 2026, as I summarized in my introduction, based on the strong backlog we have and very strong pipeline, we anticipate further growth this year, in spite of the exceptional acceleration of 25. With an annual adjusted growth target of 15%-20% at constant rates, exchange rates and tariffs. This is in line with our average growth trajectory of around 30% per annum since 2022, and by the way, on a longer period, too. This growth should be both benefiting Europe and the rest of the world. Regarding VAS revenues, they're expected to continue to grow significantly, around 40%, more than twice the top line growth.
With strong performance in both recurring and non-recurring VAS solutions and revenues. The group also aims to continue improving its profitability with an adjusted EBITDA margin of to grow, expected to grow more than 100 basis points. This increase in profitability will be accompanied by continued growth in operational free cash flow compared to 2025. We are determined to keep for the group a very strong balance sheet and a positive net cash position at the end of the year, including, of course, potential acquisitions. That is this. Given the positive business momentum, we feel the group maintains its ambition that we had set ourselves in 2022 for the Vision 2027 strategic plan.
Also, for your information, we should launch shortly a share buyback of EUR 30 million. The details of which will be communicated at the time of launch. Finally, I'd like to say a word of the strengthening of our governance. The board of directors today co-opted Mrs. Lyne Castonguay as an independent director. Lynn will be replacing Candace Johnson for the remainder of her term, until the next general meeting of June fourth, which will be then called to ratify this co-option and renew her term for a period of 3 years. Mrs. Johnson, as you know, was no longer considered under the AFEP-MEDEF rule, independent, having served on the board of directors for more than 12 years. She will be replaced by Lynn. I'd like to thank dearly Mrs.
Johnson having brought considerable value to our company. I'm pleased to welcome Lyne Castonguay to our board as an independent director. It's going to strengthen our governance and increase the proportion of independent members from 64% to 73%. Lyne is a Canadian and American national, with more than 20 years of leadership experience, primarily in retail and consumer goods. She's held senior executive roles at Home Depot, Sobeys, and Starbucks. She now also serves on the board of Canadian Tire, one of the leading retailer in Canada. Definitely her deep expertise in North American retail will further reinforce our strategic capabilities in the region, which is, as you know, a key growth driver for VusionGroup. With this, I'll hand over for questions.
Thank you so much. Dear participants, as a reminder, if you wish to ask a question, please press star one one on your telephone keypad and wait for your name to be announced. To withdraw a question, please press star one and one again. Please stand by, we'll compile the Q&A roster. This will take a few moments. Just give us a moment. Now we're going to take our first question, and it comes the line of Hugo Paternoster from Kepler Cheuvreux. Your line is open, please ask your question.
Yes, good evening, gentlemen. Can you hear me well?
Yes, we can.
Great. Thank you for the presentation. I will have 3 question if I may. The first one revolves around your guidance. You mentioned that the growth will benefit from both North America and Europe. Just wonder or wanted to have a better view on what do you expect in term of organic growth for Europe for next year? The second one is on the working capital. How much of your, I would say, 2026 revenue is already prepaid, and what working capital swing should we expect for next year? If you could provide us some light on it. The last one is on Walmart.
You mentioned that you are in discussion for potential additional rollout and potentially incremental, cross sell. Could you come back on it, whether it's for computer vision, if it's for international expansion, what does it mean, in term of timing, if you can share anything, and in term of CapEx also? That will be my 3 question. Thank you.
Thank you. For the first question on the organic growth, we see 15%-20% growth this year. We consider that this growth will be balanced between, you know, Europe and the rest of the world. We see double-digit growth in all regions. I think your question was particularly focused on Europe.
Yeah.
We have won many deals in Europe, I mean, over the past few months, last year, and we continue, you see how we started the year. There is good momentum in Europe, definitely all regions will benefit from this growth. I'll let you know, Thierry, maybe you, you.
Yeah
On the working capital topic.
On the working cap, the net between the down payments collected this year in 2025, and the down payments that were reversed in 2025, is roughly a positive impact of approximately EUR 20-30 million. Next year, that's approximately a bit more than EUR 400 million that should be reversed.
Okay. Very clear.
yes, I mean, Walmart is a very, very large company. You've seen their results last week. It's a EUR 700 billion company, adding about EUR 40 billion every year. It's adding a big retailer every year, right? Walmart. It is a huge company. yes, we are rolling out, as you know, the infrastructure of EdgeSense right now in the U.S. We're working on different directions, and you mentioned them. We're working on, you know, new solutions on top of the EdgeSense infrastructure in the U.S., and that includes topics like computer vision and, you know, those things I already mentioned. That's one dimension.
There are other projects around e-commerce acceleration and around the retail media. Second dimension is, of course, we're working on the international dimension, that covers a number of countries. Some of them have been mentioned somewhere in the press. We're working well during this, and obviously, the fact that John Furner has been appointed global CEO, and we think want to expand the winning operating model, is favorable. We'll update you on this as we confirm roll out in the international part. As I said earlier, Walmart is adding a pretty large retailer every year. You know, in terms of numbers, you know, we're adding $90 billion of revenue.
It's big. There is also Sam's Club, also part of the Walmart group, which we haven't mentioned, but there is all, you know, many developments in this group. It should remain a big customer for many years, and the partnership is extremely appreciated on both sides.
Okay, fair enough.
Other questions?
Thanks a lot. That will be it for my side for now. Thank you.
Thank you.
Thank you so much. Now we're going to take our next question. The question comes line of Aurélien Sivignon from ODDO BHF. Your line is open. Please ask your question.
Hi, good evening. Thanks for taking my question, I have 4. The first one is regarding the 30% VAS growth guidance for 2026. Could you clarify the expected VAS mix between recurring and non-recurring? Regarding the 150,000 cameras, I think you mentioned during the call, should this be treated as non-recurring or recurring VAS revenue? My second question will be on the Carrefour contract. I believe Carrefour mentioned an investment of at least EUR 150 million. Do you confirm this amount? Maybe could you walk us through the operational assumption?
I mean, country scope or and SKUs coverage, for instance, and also Captana, if you may. My third question, so you confirmed the 27 target so far. On the revenue side, what makes you confident to more than offset the Walmart U.S. ramping down, I would say, from H to 27? Does it imply that you are already seeing a clear re-acceleration in order impacts in the coming months? The last one will be on the FBB. Could you say over what time frame should we expect it to be done? Thank you.
You can share that back. Yeah. Okay. Sorry, I didn't understand. Regarding VAS, we are expecting 40% growth this year. We said it's going to benefit, you know, both strongly to recurring and non-recurring. I think it should even be maybe slightly the opposite, as this year, maybe recurring will actually grow faster. You mentioned, and this includes obviously the growth in Captana, of course, the growth in cloud services, and many other things, but it will not include the, let's say, the hardware part of Captana. You mentioned the number of cameras that...
We mentioned the number of cameras, but those are not counted into recurring, because they are not recurring, simply. We count in recurring subscriptions, and that is not counted. The, so that's, so it would be excluding this camera. We just mentioned this number because it's just that, you know, Captana is, we consider computer vision as the next big, you know, technology wave in retail. We're investing, we're being believers. We are very, very happy with the work we've done on many pilots, which are now reaching, you know, significant scale. Of course, the Walmart, the... Sorry, the Carrefour rollout, as I said, is the first simultaneous full platform rollout of both EdgeSense and Captana.
You asked a question on Carrefour, precisely. I'm coming to that. The number that was mentioned, let's say, you know, it was not mentioned by us. It's mentioned that it's a number that covers, doesn't include the VAS, doesn't just includes France. The scope of the project is European, will be, you know, starting first implementation also, soon in Spain, and I, it's a, you know, I don't want to comment on this number because it's part of the communication of our company. It doesn't. Well, it's France and only hardware, not VAS. This is a significant VAS contract and project. Very, exactly, I think very, representing very well the type of work we do.
We sell transformation project, to very strategic transformation. We, you know, sell to the C-suite, a transformation that covers many dimensions, a full digital transformation. You see in the press release the number of dimensions that are mentioned. I think that's, you know, so it is by definition a project that covers a very large part of our portfolio of solutions. It's not included in those numbers. Those numbers were relatively partial. Your third question, Aurelia, I'm sorry I missed it. It was about.
...
No, no, that was the fourth. The share buyback, and I will probably mention-
The 27 target. 27 target.
Yeah. Well, you know, the, you know, the end of 2027 is in 2 years, right? When you look at our company, there are 2 things: we win a lot of new logos every year, and we just, I think, started the year with a good example, and there are gonna be many more, right? First, we win new logos, and pretty much more than combined competition every year. That's one driver. Second thing, we have a very strong, very large customer base, in which we have a lot of growth drivers. First, of course, covering the full, you know, fleet, and very often we are below 50% penetration. Second, vast adoption in those customers.
Third, the beginning of the swap and upgrade to EdgeSense in some of these very large customers, which will start. That's a very significant growth driver for us, our installed base, and that's our model, by the way. Of course, there is also all these new logos that we will continue to win. I just would like to say, today, the unequipped market is very significant. If you take just the U.S. market, you know, and excluding Walmart, you know, you got a market of 2 billion, you know, paper labels that will be digitized in a number of years, but rather fast than slower, I think. It's a very significant market.
All this, our pipeline, the time we have, you know, makes us really, you know, confident that we can achieve this target that we set as an ambition, a long-term ambition in 2022. You know, the work, the trajectory we've had until now, you know, I think we'll do another significant step in that direction in 2026. We have, you know, 2 years to, yes, to accelerate other entries and win a lot of new deals. For the share buyback, Thierry, maybe?
We see based on the market conditions, very likely, in the next coming 10-15 days maximum.
Okay. Another question maybe.
Okay. Thank you.
Thank you so much. Now we're going to take our next question. The question comes line of Benjamin Thielmann from Berenberg. The line is open. Please ask the question.
Yeah, good evening, everybody. This is Ben from Berenberg. Thank you for taking my questions. I have 4, if I may. Maybe first, I'll try to be quick. First question is on Captana. You mentioned on one of the slides you expect more than 150,000 cameras to be deployed in 2026. I was just wondering, are these already signed, or is this a mix of already signed deals, plus what you expect in terms of blind version to go through 2026? That's the first one.
Okay. You do it one by one. No, it's mostly signed. Those are things that we've been, you know, in scaling our go-to markets in. It's mainly signed. It should be. This is why we said above. But that includes, of course, the beginning of the Captana rollout, of course, because it will start this year. It's been signed, you know, recently, so it includes. It's mostly signed. Yeah. Second question, Ben.
Maybe a follow-up on that, is could you give us somewhat of a guidance, how much of those 150,000 plus could be driven by Carrefour?
No, we don't, we don't give customer by customer. Carrefour, you know, anyway, is, I think you saw the video, and, you saw the press release. It's a very significant rollout, where the whole stores, hypermarkets to start with, then supermarkets, you know, are going to be covered both by EdgeSense and Captana. I mean, you can figure out the number, but, I don't wanna go too much in detail by, on nominative basis with, by customer.
Yeah. Okay. I had to try, Thierry.
Yeah.
Maybe next question is, you mentioned that you guys have an edge on computer vision compared to your competitors. I was just wondering, where do you exactly see this edge? Is it in terms of lower or shorter lead times because you have better production capacity? Is there a big difference in underlying technology? Any color on how you see yourself compared to competitors would be very helpful.
Yes. Well, you know, we are in the world. I think it's, you know, it's a little bit the same as EdgeSense. We're in the world of IoT. We're in the world of connected IoT. Whereas, so that means that, you know, the real performance comes from multiple different things. It comes from hardware, and miniaturization in design and embedded software in the hardware. That's a very strong expertise of our company. The whole end-to-end cloud-to-edge software, and then all the, you know, AI engines that are running. To have a, you know, a really well-performing solution in retail, which is a very specific use case of computer vision. You know, we're not in video security cameras.
We are in observing shelves, which is a, you know, very special use case. That's where our tech edge lies. The combination of the IoT expertise, the embedded software, the end-to-end cloud management of... And the AI this combination is where the magic source appears. We see that, you know, we are, you know, we are comparing ourselves, and we think we're really advanced. We started... You know, it's not something that we started, like, we decided to launch like a month ago. Or a year ago. You know, this is something we're working with dedicated teams since I'd say 8 years.
I know you might say it's slow, but, you know, when it takes off, this is a big thing. We think today, a lot of retailers are seeing this as the next big unlock of productivity and supply chain management in their operations, so we're quite excited about that.
Okay. Interesting. Thank you. Then maybe one more question on the pick-to-light function. I've seen it in the video. I was just wondering whether there is a potential use case that Carrefour, that maybe, or that maybe Spark Driver in France or in other European countries, in the Carrefour stores, could get access to the software, that they could also use the pick-to-light of the ESL, or is that not planned in the foreseeable future?
No, of course. It's a fundamental feature of our hardware and software platform to enable very fast, accurate picking and stocking, because both are equally important. Stocking means replenishing the shelf and going very fast at identifying where to stock shelf, where to stock each product. This is a very labor-intensive work and error-intensive work, pick-to-light on preparation of e-commerce. It's very central. Why? Because simply. I think the lesson given by Walmart to the world is actually that the store is a fantastic e-commerce weapon. Today, you've seen the numbers last week, Ben, I think you were with Walmart, I mean, I know you were with Walmart early in January. You've heard them. Store fulfilled e-commerce.
Look at the numbers they published. 50% growth in store fulfilled e-commerce. Now, they have, you know, among the millions of orders that they prepare every day in stores, they are delivering already a third of that, more than a third, 35% of that, below 3 hours, just because it's all local e-commerce fulfilled out of stores. This is the next big growth driver of e-commerce, and we see a number of retailers basically realizing that they've made mistakes in building very automated warehouses for e-commerce. A number of them, I'm sure you know, are shutting them down, actually, and there was an announcement even for our retailers today. In the U.S., it's the same. It's gonna be the, you know, the time of store-fulfilled e-commerce growth.
For that, you need to enable your store, you need to digitize your store, you need to locate product very accurately. You need to make sure you got the right availability when you're doing your picking, and you need to go super fast at picking. The statistics of the usage of our solution by the internal staff of Walmart and the Geek shoppers are, you know, just massive. We're talking about tens of millions of triggers of pick-to-light every day today, and we've only done, you know, as I said, half of the fleet. It's. This, again, you know, is a little bit like what I said on computer vision. It's something that combines, you know, IoT design, infrastructure, protocol.
It's all, you know, sort of in many dimensions of the solution that you can actually trigger this. Not even mentioning the, the power efficiency that you need in order to be using these devices intensively all throughout the day and 24/7. You need a very, very power-efficient system, which again, is one of the things that are, you know, that is the competitive, you know, edge of it, you know, of EdgeSense. I could go on forever, so I'll stop here. For sure, it's central in the choice of Carrefour. E-commerce is central, yeah, today in the choice and will be more and more central in the choice of... I think it's new, to be frank. It's true that now people who are-...
Thinking, oh, I'm gonna take, you know, ESLs and they need to think, what is my strategy in e-commerce? They need to very carefully, you know, evaluate the different options, and we see a turning point today in the market.
Okay, interesting. Thank you, Thierry. Maybe a quick one. There was a CFO, Thierry, there was a EUR 54.9 million warrants related fair value amortization, which also embedded an average price opponent that was driving it. It was written on the slides that you expect this to phase out by the end of 2028. I was just wondering whether you could, A, maybe split those EUR 55 million into how much of that was actually the amortization component. B, is what run rate can be expect until the end of 2028, or maybe how much is the total fair value amortization that you expect between 2025 and 2028?
Well, actually, I will give you the figure for 2026. It's approximately 40.
Oh, 40.
5 is 40. They both combined. Of course, the negative impact arising from the warrants fair value amortization is going down. You've got a positive impact, which is partly offsetting it due to the weighted average price. The net impact for 2026 should be approximately EUR 40 million negative, versus the EUR -55.
Okay. Maybe a very quick last one. You mentioned it on the, on the slide, with the free category reconciliation, there was customer finance CapEx of EUR 77 and a half million in full year 2025. I was wondering, what was the total amount of prepayments that you got in 2025?
Well, we didn't disclose that figure, so you go really into the detail. In 2025, actually, no, everything was already funded by Walmart in 2023 and 2024 on the lines.
Okay, there were also prepayments for Walmart.
There were also prepayments for the hardware, but the prepayments for the lines was entirely paid at the end of 2024 for approximately $320 million.
Mm-hmm. Okay.
For the prepayment-
Okay, perfect.
Thank you so much.
Thanks, Ben.
Now we're going to the next question. The question comes line of Flavien Baudemont from Bernstein. Your line is open, please ask the question.
Hello, and good evening, gentlemen. I have 2 questions on my side. The first one is on the Carrefour rollout. How long will the rollout take? They mentioned that it will last until 2030. Do you confirm that? For Captana, are you planning to lend them or sell them the cameras? On the second question, can we have a more broader outlook on, let's say, the end of 2026 and 2027? Do you see any big movement in the U.S., or are you planning to at least announce a massive contract by the end of the year to support 2027 growth? Thank you.
Regarding Carrefour, I know it's been presented, the project has been presented as part of a 2030 plan, it's been assumed that that was the timing of the project. If you look at the interviews of the CEO of Carrefour, he also said. He answered a few questions, he said: "No, no, we're gonna go at 2,000 per hour, and we're gonna go faster." We think it's gonna be faster. It's very often faster.
You know, if you look at a big contract in America, was supposed to be a number of years, and then it's going fast, just because it's, you know, it's delivering high returns and people want to accelerate, and even if there are, you know, sort of tariffs and everything, nevertheless, they don't, they don't stop, they accelerate. I think it's gonna be faster and will include a number of countries, and it will include all these different solutions. By the way, there's gonna be plenty of developments because we are joining forces in some solutions development together, and those solutions will be rolled out because they'll be co-developed with Carrefour, so they'll be rolled out in Carrefour. There's plenty of developments.
Again, I don't wanna comment on the number that was, you know, mentioned without very much, you know, sort of scoping or precision. It's partial, geography wise and solution wise. As I already said, in Captana, you know, we don't wanna go specific. Doesn't make a big difference actually, whether we rent them or we. Because the proportion of hardware and versus software in Captana is much higher on software, so it doesn't make a big difference. We don't disclose specific, you know, sort of business models on a customer-by-customer basis. Again, it's not a big difference.
Like in ESL and cloud, you have a much bigger, you know, sort of proportion of hardware to software, not so much in computer vision. 27, I will, you know, I'll make the same answers I've already made. The market is big. We have growth coming from new logos that we will continue to win, you know, on a regular basis. We have a tremendous customer base for which we have plenty of penetration, you know, coverage, extension, vast new projects, and of course, for some of them, migration to EdgeSense, so which is big swaps projects. You know, we have 2 years before the end of 27, so I'm sure we have a lot of time to win a lot of deals, and we will.
Yeah, thank you. Maybe a follow-up on Carrefour. I didn't see in the press release that, you're gonna sell them your engaged solution. Are you selling any retail media services to Carrefour?
Yeah.
Depending.
Yes. I mean, retail media is mentioned in the press release. If you look at the number of the items that are part of the scope of cooperation, it is not specifically mentioned like that because Carrefour is not per se buying themselves retail media solutions because they have their joint venture with Publicis Unlimitail, so it's a different setup. A number of the Carrefour stores are already fitted with some of our technologies in retail media. It's a different setup because it'll go through our partners.
Okay, thank you, Aurier.
Thank you.
Thank you so much. Dear participants, as a reminder, if you wish to ask a question, please press star one one on your telephone keypad. Now we're going to take our next question. The question comes line of Valentin-Paul Jahan from Stifel. Your line is open. Please ask your question.
Good evening, everybody. Do you hear me well?
We do.
Perfect. Thank you so much for taking my questions. I have 3 set of questions, and I will try to be short. I suggest to go one by one. The first set of question relate to Captana, that you said is the next big growth driver, potentially. The large-scale Carrefour contract in computer vision appears to demonstrate the company payback for retailer, and that the solution is now retail ready. I am wondering, what is the Captana development potential, especially for 2027, in the event of major successes in the coming months with additional clients, and what obstacles will limit its development despite strong client appetite? Could you please provide more detail on camera, the industrial setup you have for producing camera, production capacities, where it is produced, is it in Chihuahua with Jabil?
Please help us assess the growth potential of these solutions going forward in the case of major success to come. If any, I mean, assuming you successfully convert Walmart, for example, just an hypothetical example, as you mentioned it previously in previous answers, would a very large scale Captana camera rollout with a retailer already fully equipped with EdgeSense, be as gradual as the EdgeSense rollout has been, or could it be much faster, for example, in one year? What level of volumes your current industrial setup with Jabil in camera is currently ready to absorb on a yearly basis? Could you clarify if you are, yes, if you are industrially ready to sell several millions of camera in 2027, and if the demand is there, obviously?
If you are, and if you are not ready currently, do you think you need to be ready right now? Do you see, is it costly or too early to prepare for this type of phasing? This is my question around Captana. Can you please give a little bit more color on all of that?
I thought I had given a lot of color already. It's first on the industrial setup, we are, you know, I think you should feel comfortable because the way we've ramped up such a sophisticated and new technology as EdgeSense, and the way we've ramped it up, I think should indicate that we have a certain know-how in how to scale IoT innovations industrially. We have excellent partners. You mentioned one, we have others, EMS. Those are the ones with whom we'll scale this solution. We're already working with our EMS on the industrial setup for Captana.
You know, we're phasing it, for sure, we will be ready for millions of cameras in 2027 and more in the following years. I mean, the scale of a computer vision solution is significant because you have a number of SKUs and, you know, you need one way or another, one camera for, you know, 50, 200 SKUs. You can make the maths easily, it's a very significant business. We're still at small scale because it's a complex technology. You know, like, you know, you could have thought, you know, autonomous drive will be everywhere 5 years ago.
You know, it takes a bit of time to really make something completely robust and mature for a world like, you know, autonomous drive in the street or simply the physical stores, which are very, I would say, complex environment for technology. It is, it takes time, but it's naturally big, big projects. We are quite, you know, secure in terms of the industrial setup. We are already working on it because obviously a number of projects will be big in 2027, and we'll continue to grow. The business case associated with that, which is basically managing with very high accuracy, shelf execution, planogram compliance, out of stocks, is, you know, it's very important items in the P&L and the balance sheet of retailers.
It is, as I said, the big and next handbook, so it's gonna be big. Now, having said that, you never know what's gonna be exactly the shape of the exponential curve, but it's. What we see is extreme interest. I think, you know, the interviews of CEO of Carrefour is mentioning out-of-stock, you know, management as every time was the number one priority mentioned in the. Because it's driven by, it's related to revenues immediately, right? That's what I can say. You have a second set of questions, 'cause you don't have questions, you have sets of questions.
Yes. Yes. It will be more about SESimagotag's production lines.
Yeah
... the, which are dedicated to Walmart and located at Jabil factories, if I'm correct. Could you clarify the new profitability model you have? I mean, historically, all ESL, all electronic shelf labels, production costs were included in variable cost margins. Now, with these 4 lines, which are within your balance sheet, there is depreciation costs obviously. Lately, it introduced fixed costs to cover the general and administrative expenses that Jabil incur for hosting these lines in their own factories, but they are your lines. As the Walmart U.S. fallout on SESimagotag solutions normalize and decrease in 2027, and utilization rates of these 4 lines should decrease obviously from the 2026 peak.
How sophisticated is your EBIT margin and your free cash flows to lower SESimagotag's productions volumes? What will be the break-even utilization rate in volumes for SESimagotag's going forward?
Just on that, Valentin. We have a fixed cost, and this fixed cost was already fully prepaid by Walmart. Now the utilization rate of the lines is not really an issue for us. Of course, we are going to keep using them for other customers than Walmart after the completion of the Walmart rollout. Since they have been fully paid by Walmart, we don't have any topics around the utilization rate. Utilization rate and eventually left, spare capacity would be an issue if we had fully funded the lines, and we were not able to use them, which is not the case in this situation. It's not a deal.
It's rather an opportunity for us because we've got lines which have been fully funded, that we're going to be used, able to use for other customers and to accelerate the availability of the products. That's rather an opportunity than a threat or a worry for us. That has no other impact.
It's fully funded in terms of CapEx, in the future, you probably have OpEx also with these lines, no?
No. No.
Okay.
No, the usage of the line is by definition-
Variable cost.
Yes. It's in variable cost, yes.
It's in the variable cost that is in our VCM.
Okay, um-
You know, we have already delivered a certain level of volume of sales to Walmart, and we have already incurred the full cost for the sales that we have delivered.
Yes. I think you have a... In fact, the business model of SESimagotag reflects perfectly in our accounts.
Yeah
... already, you get it. You, it's gonna be the same moving forward, and it is a very differentiated product, and I think it shows that it's a very, a more profitable product. Maybe a last set of questions?
Yeah, yeah. Just to see these lines are amortized over 5 years. It's the depreciation that you are accounting policy are considering.
Yeah.
I mean, do you do we have to expect the same amount of CapEx around 2030? I mean, it was, if my memory is correct, it was around or between EUR 250 million and EUR 300 million for all of those lines or something like that. Is it something that you will have to pay again to upgrade it, to make it available and up to date on a long-term basis? Is it something that will be recurring every 5 years in your CapEx or?
No, no, not at all. Valentin, the only reason why we invested is because we, Walmart, had to make this capacity available in order to be able to complete their rollout-
Very fast.
In a short timeframe. Exactly. Once it's completed, it's done, we are not going to reinitiate another cycle of CapEx on this. The CapEx moving forward is going to be the cash CapEx, the CapEx funded by the group, essentially driven by R&D and IT investment, and also some manufacturing equipment that we can invest in, which are essentially the molds, the testing equipments, this kind of stuff. We are not going to reinvest in manufacturing lines.
Yeah. In other words, you know, we have a fabless model, which we basically went out of temporarily because some lines were pre-funded by Walmart in order to be having very high capacity in a certain amount of time. That was the only reason. It's very. Our model remains fabless, and we will resume that model after the amortization of this, of these lines. The amortization is in our accounts, and that's in our EBIT.
Mm-hmm.
You know, we, you can follow our EBIT, which is after the depreciation, of these lines. There is nothing that's gonna change in our business model. It's already very reflected.
The only thing, Valentin, Paul, is just, we don't have a full year amortization of the four lines in 2025. That should be the case starting in 2026. The amortization expense is going to slightly increase in 2026 compared to 2025, but nothing which is going to start rotors.
Okay. Very clear. Thank you.
Okay.
Thank you.
Thank you so much. Now we're going to take our last question for today. The question comes line of Gilles Crespel from Alizés. Your line is open, please, after question.
Good evening. I'll try to be very short. Well, congratulations first for the margins, which have been impressive for the year and for keeping your bearing, while VusionGroup was a bit shaken on the market. I hope you can hear me correctly.
We can.
Yes.
Yes.
Great. If you allow me 3 very quick questions. The first one would be on the US market, besides Walmart, which has great potential and many good things, we have seen, unless I'm missing something, no significant new logo. Could you comment on that? I'm talking about new orders in 25. Second would be about the EBIT margin and the guidance for 26. Do you see it as continuing being on the growth margin or something more split in between gross margin and operating leverage? The third would be on the VAS. There are still limited progress, if I may, although the second semester looked promising in 25. What do you expect in...
When you guide for plus 40% in 2026, do you expect this to be something balanced in between recurring and installs or, well, stronger on one side? If you allow me, what makes you more confident on this rather strong growth than you have been earlier, because it has been a bit of a challenge to increase also, obviously it needs to be progressive? Thanks for taking those, hopefully short points.
Okay. Yeah. Yeah, U.S., well, U.S., I think, you know, we, we see the market has been a bit slowed down last year by the tariffs. I think we see a cautious adoption. Of course, they knew Walmart was going. Well, they knew, but I think they realize now that Walmart is going so fast, because it surged really during the course of 2025. We didn't, Walmart was not so vocal about it at the beginning. It is, I think it's an adoption which has been slow.
A number of, you know, we need a certain time to implement a pilot with EdgeSense, with, you know, connecting the different entities in the retailer, which are, you know, e-commerce, store operations, merchandising, in order to really materialize the superior returns that our solution brings. If we just focus on the people who usually buy, you know, ESLs for price automation, we don't really capture that, so it's a bit longer development. You know, it's, and none of the, you know, sort of, you know, none of the retailers who have chosen, you know, standard ESL solution, or started, let's say, some deployments of standard ESL solution, have yet tested EdgeSense.
I think it's just the timing of development, you know. It happens in the U.S. sometime. I think Walmart is a bit shaking now, the market, because they are delivering so impressive results, you know, for retailers. I mean, you may not be experts in that, but for the retailers, what they see in the numbers that they saw again last week is just something they don't even understand how it's possible. You know, it's so impressive. I think, you know, it's gonna change. The market is really big, again, really big. I mean, I mentioned a number of the whole potential outside Walmart, and I'm only, you know, talking about the top 100 retailers, it's really big.
We're very excited about this market, and we think, you know, nevertheless, it's gonna be extremely, we shouldn't see a year without new logos. EBIT margin, Thierry, maybe?
It's balanced between the contribution of the VCM of the OpEx. Thank you very much.
Okay. Balanced. The VAS is actually, you know, again, we, you know, we started this journey on VAS again, it was 7, 8 years ago. Our VAS were EUR 15 million. Last year was EUR 211, so EUR 210 million. It's, you know, it's fast growth, but it's bound to accelerate because it's a lot of adoption on, you know, existing customers. Not only do we see customers who are starting to roll out immediately and, you know, multiple products, so you can see that from the outset, our customer development involves more VAS now, but also all our install base as they migrate to cloud, become, you know, a development field for our VAS.
Some of the products are just at the beginning. I know you're impatient, but we see great traction. Some of the products, like retail media or even Captana, we talked a lot about Captana, are quite at the beginning. Those things are like, you know, EdgeSense was also a bit like that, you know. For a number of years, it was development, it was a lot of testing, it was not much revenue. Now, it's more revenue, and it will be the same for Captana. We are, we are confident that this is a, you know, a strong growth and, you know, driver, but also a strong profitability driver, a strong stickiness driver for our customers, and also bringing stickiness on the ESL and the digital shelf system part, you know.
It, it means that, when we renew, you know, those customers and upgrade them, we have, you know, a much higher loyalty. That's what I can say, so, and, we'll probably see, you know, in the coming years this expansion of the mix of VAS, and, also because of the nature of recurring. I said something, by the way, I repeat it because I said it and you asked it. I said, this year recurring should grow faster than recurring.
Okay. Thank you very much. It has been a long session.
Thank you. Dear speakers, there are no further questions for today. I would now like to hand the conference over to Thierry Gadou for any closing remarks.
Well, thank you very much for your participation tonight. We will speak again shortly on the 21st of April for the Q1 sales, and in the meantime, I wish you goodbye and a great evening.
Thank you.
Bye-bye.
This concludes today's conference call. Thank you for participating. You may now all disconnect. Have a nice day.