I'm Chair of the Board in poLight. I have the pleasure today to welcome you to our Capital Markets Day, and where Øyvind and the team have prepared quite rich content for us, starting with some presentations. First one out is Zine Bouhamri from Yole, and I hope I pronounce his name approximately right. He will give us some insight out on the camera trends. Then next, our own VP in North America, Tristan Joo, will talk about our perspective, how we look at the market and the customer potentials. After a short break, we'll have Pierre, our CTO, give us some insights in the technology platform and roadmap. And finally, of the speakers, Marianne will tell us about how we produce and organize our operations.
Then we'll have them all together for a Q&A session, and I bet that there are no questions that cannot be answered. After that, it's time for demos, and for the most interested of you, you can have a tour in the lab with Lars Henriksen, who is said to be the brain behind the technology.
Pierre refuses to come too. So I, I don't know. I don't know. But, with that, I wish you a great day, and I give over to Øyvind. It's an awesome day.
Thank you, Grethe. Okay, also, welcome from me. It's a pleasure to have you all here in Horten headquarters, and also thanks for you joining through the web. We have tried to kind of save cost and do Teams instead of an expensive webcast, so I hope that works. In the management team we have today, as Grethe mentioned, CTO Pierre Craen . Marianne Sandal, COO. Alf Bekkevik, CFO, and also the new CFO. Maybe you can stand up and show face at least those here. Joakim Bredahl, he's the new CFO. You will meet him later today. As from the board, as you seen, Grethe, and also Marianne Bøe, where are you? Is also from the board here today. So we are very well represented.
So, I will go through a few slides before we let the main speakers enter the scene. It has been a long run. It has been extremely painful journey. From the early days innovation phase, which was not easy, but relatively short, to going, taking a product idea into a real commercial product. Establishing manufacturing has been an extreme experience and costing us a lot of time and money. And then you're gonna qualify yourself, prove that you are reliable, prove that you have the performance, which also took a lot of years before anybody dared to take our technology into product, into end products. But finally, after many, many iterations and improvements, we got the first designers in 2020. And then, of course, COVID happened.
So if we hadn't not had enough problems on this way, that was of course adding to the challenge. But since then, we have been adding to our design win slides that we'll show later. And, many, many have supported us throughout the years. Latest now, share issue, rights issue, where the existing, investors, have secured a robust financing for the company, which is super important for our customers, of course, and us. For those who are new, tunable optics is kind of our, topic and, and, where we really work hard to be the best in class. 2005, as I mentioned, we are using our technology in many different, market segments, and, we hold a, a strong IP platform. We have, 46 employees now, increasing a little bit.
I think it's up from nine, but nine since Q1 last year. Headquartered in Horten, but we have people throughout many countries like Finland, France, Germany, China, Taiwan, U.S., U.K., and the Philippines. Listed since 2018. If you're gonna say four things about TLens, or our technology platform, extremely fast, can be realized in very compact solution, constant field of view, no breathing, and very low power consumption to drive the lens. As I mentioned in the beginning, we are using our technology in different market segments. We have defined three market segments, which is key. Consumer, represented by smartphone, wearable, accessories, et cetera, which was super important due to there is the volume today.
We also, more and more, are focusing on AR/MR, which in a way you can say has a bright future, and also a, I would say, where the innovation basically happens. Whereas in the consumer side, and specifically among the smartphone, there, it's all about cost reduction. You can see in the AR/MR space, you see that a lot of technology which is needed to be developed, is needed to be innovated, to make that fly. So the innovation side, I would say, is very much stronger in that area. And many analysts, we believe that that will be a key market, in the coming years.
But also our technology has application which is far away from that kind of segment, more low volume, higher price point markets such as industrial, barcode, machine vision, and we are basically using the same products in those markets. So those are the three markets we are primarily focusing on. You can say that it's maybe too widespread. I think when, if you go back, if you go back 10 years, it was mainly the consumer we were working on, but, as we achieved a more mature product, as we achieved a more mature organization, we took the chance and we had the fact that we had the ability to also address some other market segments being AR/MR and industrial. I think AR/MR, it's important that we are there early.
If you take the smartphone case as an example where we were late, there were AR solutions for many, many years before we were able to enter the market. And then, of course, it's much more challenging to come in as challenging the incumbent technology. Whereas in the AR/MR, we are very early, and as you will learn from Tristan Joo, is that we are today the only AR solution used in AR/MR devices. So it's a completely different situation. And then, of course, in 10 years, 20 years from now, we also want to have a good and durable time, and that's why we are listing two other markets, and that is automotive and healthcare. We strongly believe that those markets could represent a significant, non-trivial business opportunity, but it will not be correct for us to go all in there today.
We don't have the resources to do that. But we have that in mind when we do, when Pierre defines this roadmap, we have those markets in mind so that we are compatible when that market is ready. We are quite proud of this, and this starts to be quite crowded. Where we have four design wins in AR/MR. As you see in the middle top, Xvisio and Magic Leap, and the one unnamed customer, we are used in the secret camera. Then we have a consumer design wins, smartphone, watches, webcam. Then we have the industrial. There are six companies using us in 12 products. And then we also have this, more like scientific research, brain research activity, in with Kavli and for PhenoSys, and more to come. So Tristan will talk more about that.
So, of course, having this slide to show when we are out selling to other customers is a big difference from when we were having a roadshow in 2020 and have no design wins. So it's a huge difference. Now, people and companies trust us in a completely different level. We have references, we have shown that we can do. Huawei, we shipped 150K units in a few weeks to Mate X phone, which is kind of, a proof of that we are reliable and ready to ramp. When it comes to the strategic direction, definitely the key thing here, on the left side, left box, is to have really work hard to achieve growth based on existing products. That is, that is key.
That has been key for several years, and this has led us to, if you go only a year back, we, I would say the majority of an organization has been all about that. Trying to get new customer, trying to get business, and less so having a lot of fancy innovation project. The majority of the team, even at the CTO team, has been involved in achieving that. Focus markets we mentioned, and long -term market we also mentioned. Lately, as we see, the need for it, we had to, and also as we were able to break through in all key markets, we have also started to allow more investment on the innovation side. Pierre is smiling every day when he come to the office, and he's smiling every day when he leaves office after the company meeting.
This is because we have approved a quite an extensive investment in new product and technology, and Pierre will tell all about it, at least most about it. More TLenses, a new product, TWedge. So this is a new gear, a new era in the company. We have to let R&D be R&D. We have to give Marianne the resources she need to invest in the manufacturing so that we are able to future-proof the company. This is super important, but we couldn't afford that five years ago. But then we need to prove that we are really able to get into the market with existing products. Now, we have proven that. Now, Tristan's gonna scale, and now we need to focus on R&D and stand-alone operation. Then we have a veteran.
We should all always have a vision, and the vision we have is that we really would like to become something more. We'd really like to become something which is more than a component supplier. We really would like to be a solution provider. We would like to offer not to our customer only a product, in a way, a problem, but a solution. That could be many things. I'm not gonna dwell on that today. It could be that we are a one-stop shop for tunable optics. Could work as we climb up in the value chain and deliver more than a tunable lens, but also more like a system. This is something we are... I, every night I go to bed, I dream about this, and I look for opportunities. How we're gonna achieve this?
I don't know yet, but it's still gonna be a something we are targeting. When it comes to a more operational strategy, I've been managing tech companies for soon 30 years, and one thing which I've learned is that you have to have be local. You have to think globally, but you have to act locally. Having suitcase will travel is not enough. You need to have, in key markets, you need to have local organizations, which is the everyday drinking tea or whatever with the customer and partners. That's really our strategy to have exactly that. We also would like to minimize our spending and fixed cost. That's why we're designed to be without factory. So we only produce the polymer, which Lars will show you if you want to see it. Less other than that, we do basically outsource.
So we work with big, strong international companies. STMicro, as an example, I get, is our MEMS supplier. Tong Hsing in Taiwan/Philippines is our assembly partner. So we work with strong, solid partners. Without them, investing in poLight or capital we need in poLight will be something completely different. When it comes to operation, and Marianne will talk more about it, but also same for the operation side, where we have assembly activity, where we test our finally produced product, we need to have also specialists in place locally. And that's what Marianne are gonna talk about. So with those introduction slides, I would ask our dear Tristan Joo to enter the scene. Sorry, no, it is actually not. I'm missing. Do we have him in?
He is in, so then we should just bit here.
Okay, so just let the participants know, he is sitting somewhere long away from Norway. So he is saying he will be coming in the Teams meeting, and we will try to connect him onto that screen so that we can all see him. I cross fingers because this has been my sleepless nights, if this gonna work.
Okay, yeah, do so. Do so.
Yeah, yeah, yeah, yeah.
We can see also in the room here.
Yeah.
Well, there you go with the.
So now we should see you seeing.
Hello. Can you hear me?
Hello. Yeah, we can.
Okay, great. Nice to meet you, everyone. So I am not seeing the audience, so hello to everyone.
Let me know if everything looks fine on your end.
Everything is fine. Thank you.
Okay. So I can start whenever you want.
You go.
Okay. So thank you for having me. It's a pleasure to be here. To introduce myself, I'm Zine Bouhamri. I'm the Activity Manager for Imaging and Display. I've been with Yole for more than six years, and I'm calling in from Tokyo, though I'm French, but I've been here for three years. I apologize in advance if sometimes my voice cuts off. I got tonsillitis yesterday, so a bit of a challenge. So as of today, to give you kind of a food for thought and give a perspective from a third party on what's happening in terms of VR, AR, mostly displays, and then what's happening in compact camera modules, we're gonna be having a very simple outline for today's presentation.
So we spend 10-12 minutes per topic, first on AR and VR displays, and then on the compact camera modules and notably, the actuators. So I'm gonna talk a little bit about market, but we're gonna try to focus also on technology and applications, use cases, and so on. And I'll leave a time for the Q&A at the end. So first, on AR and VR displays. So I want to start with definitions, because we've been hearing about AR, VR, XR, MR, and so on and so forth, and it becomes quite confusing sometimes. And sometimes when you discuss with people from the industry, there's quite a confusion, and the latest Apple Vision Pro doesn't help on that. So here's our definition. So you have text.
Of course, the slides will be fully available to anybody. At the end of the day, what we call VR is when you are totally cut off from the outside. If you are seeing light from outside, but which is detected by a camera, like, for example, the Apple Vision Pro, the Meta Quest, and so on, we still call that VR. Sometimes people call that AR, but we would call that video see-through because you are using cameras, visible cameras. AR, in the 100% sense of what it should be called, is when you have a blend of light that's reflected by the physical world and a display giving you some additional light.
It's very important to make the difference between those, because at the end of the day, the technological choices that you have to make are completely different, both for the optics and for the displays. We're not gonna talk too much about the optics here, unless you want some more details later on. But at the end of the day, you have pancake optics. Let's say regular lenses very briefly, and for AR, it's mostly gonna be waveguides. So on a where you're gonna have a nano grating on a glass or sometimes with a polymer films and so on and so forth. And in terms of displays, we are talking on one hand, it would be like microdisplays, like from 0.7-2.5 inches.
That's what you have, for example, in the Apple Vision Pro with the OLED on silicon. For AR, it's gonna be microdisplays. LCOS, OLED on silicon, MicroLED or MEMS-based solutions. The microdisplay players that we have in AR and VR, actually, depending on the technology, one technology can only be useful for AR, one can only be used for VR. Interestingly, be it for OLED on silicon or for MicroLED, what we call self-emissive technologies on silicon, they can address both applications. Here you have a few examples, and we will get into more details about what are the requirements for using this or that. That being said, I will now separate VR discussion with the AR discussion.
To give you an idea on the VR headset market, so remember back in the day, Mark, Mark Zuckerberg acquired Oculus for $2 billion, and the dream was that everybody would be using VR for social and so on and so forth. Actually, it didn't go as planned. It still stayed a niche market, so video gamers and a couple of user experiences on top of the professional use cases, of course, like training, like medical healing, and so on and so forth. And with the Apple Vision Pro, they kind of try to legitimate their use case, and they are trying to seduce more consumer, and now they are trying to use this new word of a spatial computing, kind of a buzzword, as we call it, to try and recreate a need for the market.
Other players are gonna follow. We're gonna see a couple of examples, but we are not talking about hundreds of millions of units. As you've seen, it's very expensive. It's still bulky. The use cases are not very super clear, so we are only anticipating up to 18-20 million units sold a year by the end of the century. Now, what are the use cases? So the niche is kind of the full immersion, like, the PlayStation VR or all these gaming applications that you can have.
To try to expand their market, Sony is providing by this summer an adapter, sorry, for PC-based gamers to be able to use their headsets, because actually, the attach rates that they have is not big, and it's much lower than what they had on the first version of the PS VR back in 2016. The real potential use cases in the future could be with a video see-through application. So you would have the virtual displays, kind of, we say that display redundancy. So it would be like you are working on your desktop, and you have a virtual second or third screen. You could be using that to watch games, and so on and so forth.
If you have enough computation, then you can imagine what had been promised by Microsoft with the first HoloLens. Here it will be video see-through, not really optical see-through, like real AR, but to provide experience that cannot be done with a flat display, and it could potentially be a killer app. So who's working on that? So here you have the new major products and the big moves. So of course, Meta and Apple, they are very well known. But we are seeing more and more partnerships, including OEMs, display makers, and computing companies. Give you some examples here. Samsung, Google, and Qualcomm partnering together, Samsung acquiring eMagin, Sony and Siemens announcing also a collaboration.
And on the other hand, for the creation of this new ecosystem, there's a lot of bubbling happening within China around the OLED on silicon story. So I won't get into details. I know it's written in the next slide, but actually I removed the slide because it would be a bit off-topic regarding what you are working on. And so for the display technologies comparison, so you have the four main different ones here. So we say that the LCD plus Mini LED is gonna replace the LCD. At the end of the day, not getting into too many details to spend more time on AR, but the OLED on silicon is more for the high-end, because if you look at the Vision Pro, every display is at $300.
The entry level for the LCD and the mid level would be for Mini LED. This would be the penetration rate forecast that we anticipate. OLED losing shares. It was dominating, but it's losing against Mini LED, and the OLED on silicon is gaining more and more shares with the high-end products like the Vision Pro. Now, if we come to AR, so, optically see-through, optical see-through AR, we are very far from the promises that we had ten years ago, five years ago, about reaching the tens of millions of units by 2025. It was on the roadmaps, so I will, I will not lie.
In 2018, when I started studying the topic, it was on the roadmaps of every OEM, but actually, the technology is not going as fast in terms of improvements as they would like. But on top of that, the main issue is around the bill of material, if you want to be able to address the consumer market. So we went through kind of what people in the industry call the AR winter, where things stagnated or even decreased, but now there seems to be some momentum coming up again, and it's mostly linked to AI. Because one of the biggest issue is that you can have the best technology in the world, if you are not able to provide a use case, then nobody's gonna acquire your headset.
Up until now, when I was asking people, "If I were to offer you an AR pair of glasses, what would you use them for?" Very often, it was kind of hard to get an answer from people. Now, with AI trying to enable new use cases, it can become the AR ally and trying to make us go out of the AR winter. And so the use cases could be for foreign speakers, deaf people, et cetera, et cetera. And Meta is extremely involved in that for both VR experiences and AR experiences. And so depending on the use case that you're gonna adopt, it's gonna construct an application continuum.
So if you are a monocular, so the image only on one eye, you could imagine that with a very small field of view, you would only get some information like a smartwatch and so on and so forth. Of course, you would need to be a bit more than that. By adding a larger field of view and RGB capabilities, because this is one of the issues that we have today, we can come back to that later, you can get into the dream of a spatial computing with real optical see-through AR. And so at the end of the day, if I were to sum up that, it would be about increasing the immersion.
So in terms of penetration rates that we anticipate, so MicroLED gaining some share, it's gonna be a battle between LCOS and MicroLED, we believe, at the end of the day. And then to comment a bit on what you may be looking at, so MEMS-based solutions. The issue we have with MEMS-based solutions like LBS, for example, it's not really DMD, because DMD is too expensive, too big pixels and so on. But with LBS, so laser beam scanning, the issue is that we've been hearing about it for a long time. We still haven't seen a prototype yet, and not even a product, though we have those with LCOS, we have those with MicroLED.
They kinda had a window of opportunity waiting for MicroLED to be able to reach the markets, but it feels like they missed it. If you look at the story of the LaSAR Alliance, driven by ST, they were very, very vocal about the LBS is gonna be the future, and so on and so forth. But very recently, they renamed their alliance, and they are not talking so much about the LBS solution. So of course, some players are still working on that in Europe, not only, but it's yet to see a prototype around it. And so if we look at the display and optics technology positioning for VR, for AR, I'll sum it up.
For VR, OLED is losing its share, its share, and OLED on silicon is trying to get into the high end. Of course, pancake optics have become the kind of optics that you can find everywhere. For AR, it's a bit more difficult. As I was saying, it's gonna be a battle between LCOS and MicroLED. MEMS trying to get in with LBS and OLED on silicon only for niche. They are great for VR, they are not great for AR for many reasons. And for AR, we believe it's mostly gonna be about diffractive optical elements, a little bit about HOE, so holographic elements, and the reflective elements. But as I said, it was not the topic of today. So the takeaway would be the clear definitions of VR and AR.
So all the lights you see in VR is coming from the display. In AR, it's coming from real life, physically, and the display. So if we try to position between market growth and market share, the different technologies for both VR and AR, this is what we could map. That being said, that concludes the first part. I'm 12 minutes or 13. Okay. I will switch to a status on the compact camera modules. So for that, just to... I'm sure it's clear, but I like to insist on the definitions. So this is a camera module, and so everything I'm showing you is coming from our reports. Mostly we worked a bit for this presentation.
So when we follow the camera module market, we follow, of course, the CMOS image sensor, the actuators, the lens sets, and the assembly. And so obviously, this is complex and getting even more complex, and we follow that in every kind of application. So here you can see how we market that to mobile. So computing would be the tablets and the laptops, the consumer markets, AR headsets, action cameras, and so on. Automotive for ADAS and so on, endoscopy for medical, matrix card readers, and that's it. We are here talking about compact camera modules, not really the camera modules that you're using on the DSLRs and so on, so forth. So to give you an idea of what this represents, this is the forecast by markets.
So obviously, mobile and consumer is the biggest one. But if you look at the growth, most of the growth is coming from automotive markets, because, as you know, the smartphone market is kind of flat nowadays, and we are not really increasing the average number of cameras per phone that much as we were doing a few years ago. Because now most of the innovation is coming from working or working around the optics, working around the actuators, and working around the AI computing processors that are dedicated to photography. So, and that's why I will talk a little bit about the automotive market also afterwards. So as you can see, the global market is expected to be $47 billion by 2028, and this is by market.
I also want to show it by element. So obviously, the image sensor is almost half of it. But as you can see, the biggest growth is coming from in terms of compound growth, is coming from the actuator at 7%. This is where we are seeing lots of innovations and tentative approaches to try and make things different or better. So, as I was saying, the market dynamics for smartphones is not that great, and as I was saying, the average number of cameras is not increasing as much as we thought. To give you an example, we were anticipating, for four years ago, we were anticipating by 2024, that the flagships would be using five different cameras on the rear.
Which did not happen because, as I was saying, the innovation is coming more from the optics, the actuators, and the computing that is around it. For cars, due to the increasing levels of autonomy, we are seeing more and more cameras being added to cars. So the average number of cameras today is around 2.7, and we expect that to be 4.7, 4.9 by 2030, 2032. So it's an average number, obviously. So the high-end vehicles are expected to have a system that has almost 18 cameras. And so I can understand that there could be a debate around, yeah, but what's the difference with the LiDAR-based solutions or the radar-based solutions?
But if you look at the autonomy levels, actually to reach level three, you cannot only go with one solution. Nowadays, if you look at the robot trucks, for example, in China, they are using all three, and most of the OEMs are gonna tell you that they need the three different technological choices because they actually complement each other for many reasons. Depending on the weather, one is gonna be better than the other, depending on the angular resolution that you need, again, it's gonna be one or the other, and so on and so forth. And on top of that, due to all the security reasons that we need in automotive, the redundancy is important.
So it's not really a question of, are you sure we are gonna have more cameras? And so on and so forth. It's actually a fact. So if you look at the mapping of the ecosystem, what's happening, so there's more and more interlacing. Obviously, the most well-known would be in the camera module assembly. The lens makers are trying to gain more and more share in the assembly. It's all about being vertical and trying to maximize the value that you can get out of the value chain. Because as you see, many players, it's a very, I forgot the word. Let's say exploded supply chain with many players fighting for bits and pieces, and you'll see after what it represents in terms of numbers.
To give you an example here, so it's the camera module manufacturing market shares. So obviously, LG Innotek, due to its business in mobile, is getting the lion's share. But behind, you see that it's very, very exploded. Many players having 10% or less. So you can also see that, some players have taken a big hit between 2021 and 2022. It's mostly linked to, mobile slowing down and, the automotive activity that had been strong in 2021 and that, was less strong in 2022 due to inventory reasons. And, I also just put, the one for the actuators, and so you can see here that, Alps is the leader, but only by, four points versus Mitsumi, and five, six versus SEMCO and TDK and so on.
So many different actuator players also are involved in that. And to finish just on the technology side, so to improve on compact camera modules, what do we see? So there are different approaches. Either you work on the image sensor, either you work on the optics and the actuators. And so here we try to map the if it could bring a significant progress or a status quo, or maybe something that would be worse. Obviously, so far, the cost is the most important part, especially considering the market, the bigger markets that we talked about, so the consumer market, mobile and consumer, and the automotive market.
And, so on the image sensor, the triple stack that we've started to see in the latest Sony sensor is improving the image quality a lot, but it's more expensive, obviously. You can go with a curved sensor solution, so that would allow to reduce the number of lenses that you would need. So to make a more compact camera module, maybe less expensive, maybe easier on the assembly and so on and so forth. There's obviously the liquid lens, tunable polymer, et cetera, that you are very familiar with. There's a lot of hype that started with the metalenses, so passive meta surfaces. I have a slide about that afterwards because it's actually kind of the new world and the new research that is being shouted at for a couple of years.
And we will probably see the first product in a consumer smartphone using a metalens this year. Hybrid lenses, obviously, so it's either moving from plastic to glass for mobile or the reverse one, moving from glass to plastic in automotive, because that's one of the reasons why it's so expensive in automotive. It's that you have to use lots of glass due to thermal reasons and image quality reasons, and so on and so forth. And the SMA actuator has been making a lot of noise since last year, and it's already been in several smartphones as of today, and we are seeing it gain more and more shares. So just a word on meta surfaces.
So actually, you take a surface and you nano pattern it, and that way it can do things with light that you could only do by using several lenses in a stack. So the idea is to try and replace all the lens stack with only one meta surface that you put directly on the sensor to be able to reduce the camera module volume, and maybe in the future, try to add some new features. We could talk about it in more details. I would, if you are interested in this topic, I would invite you to reach out in late September, because with the team, we are currently working on a dedicated report on meta surfaces and the applications for displays and for imaging and sensing.
To finish, it's just the technology trend, trying to go from the regular VCM to other emerging technologies, so with the different functions, so autofocus and image stabilization. Is it done on wafer level or not? Is it mass produced or not? Who are the players? Is there some technology differentiation trying to happen through the SMAs? The coloring is to show if it's available, mature, or a potential in the future. Of course, this is not exhaustive list of both technologies and companies, and that gives you a mapping of who's doing what and what would be the competition, and so on and so forth. That being said, I believe it's been a bit more than 25 minutes. I don't know?
If we can take questions or not, but I'm free if you, if you want to have questions from the audience. Thank you for listening.
Do you hear me now? Yeah. Okay. So, thank you so much. Is there any question from the audience?
Sorry. Is there any question for to, Zine's presentation from the audience? Of course, a lot of information, a lot of data. I think it needs to be digested, offline.
Okay.
Zine, I thank you so much for being with us.
Thank you.
And then I will send you a mail so that we can agree how we can potentially use or forward your question offline.
Yes, of course. So I hope it will be, it was useful to you. I wish you a great afternoon, and u ntil next time.
Thanks.
Thank you.
Have a good day.
Yeah. Thanks a lot. Thanks a lot.
Thank you.
Okay, super. That was a lot of content to absorb. Should we move to our own Tristan? Tell you a story. Tristan, he was my customer. You remember when you were my customer?
Yes.
Yes. He was heading a U.S. activity for O-Film, and he is single-handedly responsible for us being in Valley Gate.
More coming.
And more coming. So, Tristan is a very experienced manager and a sales business type guy, and he will now explain you why poLight is so great.
Yeah. Just, yeah, sorry, yeah, yeah. Just hang on a second, Tristan.
We are on?
I will share it.
Sorry?
You must sharing your screen.
Yes. Yeah. Share. Share, and then...
Slideshow.
Okay. Yeah.
Hey. Hello, my name again is Tristan Joo. I'm VP responsible for North America Business Development. I also have corporate marketing responsibility here at poLight, based in Silicon Valley, California. I have just around 29 years of deep technology career history, with the most recent 20 years focused on advanced imaging, optical sensing, and including tunable optics technology, in terms of technical marketing and general management functions of my career history. I'm very pleased to update you on today, on poLight's key focus market segments, as well as key customer opportunities that are very exciting for our future and today, as we've been referenced during this first quarter of 2024 earnings presentation yesterday.
poLight's global business development and sales team consists of these six members, with Rifai Yang, our China General Manager, and Jack Cheng, VP of Business Development in Taiwan, leading our Greater China business, and John Edwards, who actually presented at two years ago, Capital Markets Day for us, who is VP of Business Development, leading our EMEA and Asia business based out of U.K., with Rüdiger Harten, our newest business development manager, based in Germany, who just joined us earlier this year, and myself, leading North America Business Development and Sales, with Spencer Mailes, our senior technical sales and business development manager, joining us earlier last year, reporting into me, to help scale the North America business further. So before I delve into the meats of my presentation, let me just outline my presentation structure.
I've structured this presentation into five key focus market segments, with the first three being very strategically important key focus market areas, and the next last two being opportunistic but very long-term bets that we're, you know, as Øyvind has progressed earlier then. And with the first slide out of each market segment addressing the market segment key trends of the markets, each of the markets. And then the second slide covering the specific customer opportunities with our key strategy and tactics nicely summarized, to give you a added confidence in our market positioning and the future business growth potential in each of the market segments.
Okay, so our first focus market segment is augmented and mixed reality, with enterprise markets being well-established already and consumer markets actively developing, with initial devices expected to launch into the market in 2026. And where this is where we have opportunities in, specifically in AR smart glasses, consumer-grade AR smart glasses, and mixed reality head-mounted displays that employ video pass-through cameras, as as I outlined to you during this presentation.
From the latest market research company's projections, the AR/MR VST devices shipment is expected to range between 21 million units by 2028, as reported by Yole Intelligence's recent April report here on the upper right, and out to even more than 35 million units, as projected by IDC in their recent March report, as you can see in the lower right, by year 2028. For which we see clear potential for designing in multiple poLight products in each of these devices. It's very exciting. Apple's Vision Pro launch with touting its spatial computing capabilities is giving even more added confidence to the consumer market potential and developer sentiments, with U.S. and Chinese OEMs heavily in this space to lead the product development and market deployments worldwide.
Now, when I joined poLight three years ago, I brought my deep expertise in AR/MR market. So I've been very focused on since 2017, so we're 7, 8 plus, and luckily have helped lead poLight's differentiator positioning in this market, including closing our very first design wins with Magic Leap 2, an exciting announcement just recently released this June. I'm very excited to report that our TLens AF technology has been dominant, dominating the initial AF camera market for AR/MR, as like I mentioned earlier, as evidenced by our continuing and increasing for enterprise OEM customer design wins, and with multiple consumer, underlying consumer, OEM POCs and design end activities in active progress, advancing us to real end device engagements. With the first exciting potential production revenue materializing in 2026 onwards.
With key TLens use cases, as noted here, as I present here, including things like fast focus image capture of any environment, regardless of the situation, and ambient conditions, while replicating the true human eye experience, maintaining fast and constant field of view focusing, which is mission critical if you think about, mixed reality video pass-through camera, because these, our cameras are literally replacing your eyes, your life and experience based on it. So it has to be really, really out there in replicating that true human eye experience, which we so are, very good at, delivering. As well as in-focus barcode and AI-based use cases like object recognition. I'm sure you'll ask us a lot of questions around this.
At any distances or any context with, you know, very unique capabilities like all in focus, that we uniquely are able to deliver and experience, that really does help differentiate that user experience even further. And, lastly, but not least, focus tuning of laser projection AR microdisplays is also a unique TLens use case that we bring. Now, in terms of, lastly, TLens competition in this, AR, MR camera space, fixed focus being adopted in the initial smart glasses and, mixed reality, video pass-through cameras, devices that you have been hearing all along, is what we end up displacing and augmenting. Not at all the VCMs and liquid lens, you know, competitors that you always hear about. When it comes to AF, we're the only game in town, as proven by so many customer testimonials.
Now, also in AR, MR, our TWedge wobulator technology resolves show-stopping issues facing the microdisplay industry, namely, resolution versus brightness versus side trade-off, size trade-offs. So if you increase the resolution, then your, you know, projector size becomes too large, your pixels becomes too small, the brightness goes down. So it's been a show-stopping issue with this, our, you know, TWedge wobulator technology being the only viable pixel-shifting technology with no real competition identified so far. We're literally the only game in town, and we're inviting our competitors to challenge us. We have multiple customer POC projects making super good progress, with key TWedge wobulator development advancing nicely, which Pierre, our CTO, will go over in his roadmap presentation next.
TWedge leverages the same ultra small, fastest speed, and lowest power consumption advantages, and proven architecture and assembly techniques from TLens. Which really is nice combination that enables this, our TWedge quite nicely, and enables these unique use cases like enhancing the perceived resolution of the displays into your human eyes by four times or greater, or remove moving artifacts like motion blur when you're you know moving around in microdisplays. Or for correcting for dead pixels or non-uniform pixel problems plaguing the MicroLED display industry today. As this animation here on the right side shows, TWedge wobulator half a pixel shifting improves the perceived microdisplay resolution by four times. In this case, half a pixel shifting increases the four time resolution improvement.
As you can see on the example of the green images on the lower left corner, the poLight TLens global, which is a VGA resolution image on the lower left side with TWedge turned off. When TWedge is turned on, it becomes four times higher resolution on the right side, which is a 1280 by 960, almost true HD, full HD, when TWedge is turned on, making things super smooth and nicely legible. Now, in AR and MR market, we have announced four major customer design wins today, as you know, Magic Leap 2, Vuzix Shield in North America, which I led, LLVISION 's Leion Pro out of China, which Rick Bai led, and an unnamed customer, a high-end mixed reality customer in Europe.
Our regional strategy for AR and MR is to keep winning these top-tier OEMs or TLens they have in smart glasses and mixed reality videos, see through camera, and MX. Moving these, you know, you'll see here a long growing list of POCs into design-ins of actual projects, and to utilize our proven references across the AR/MR ecosystem, that we're get partnering with every single design-in and, you know, POCs advancing, to more, number of, you know, consumer OEMs and partners to drive TLens and select, select, not all, select TWedge wobulator POCs, the top, consumer or new customers and partners.
Our key tactics in this AR/MR market is to advance our TWedge wobulator development to the next step, led by our, you know, Pierre, our CTO on their team, and to continue to strengthen our position and roadmap in in the more simplified and, you know, standardized AR enabled cameras using our TLens AF technology, more simplified, and Pierre will go over more details about that later in his roadmap presentation. And we really are focused in deepening and improving our AR/MR domain expertise that we are, you know, needing to acquire and grow even more. And I'm going to personally lead that effort going more at the company and also, you know, hosting our local customer organizations to improve our, you know, local customer support efforts across all these product regions.
Lastly, we will continue to attend and exhibit at major trade shows, for related to AR and MR, like CES, SPIE, SID Display Week, which I just participated in back in May, and AWE, Augmented World Expo, the industry's largest XR event, to further strengthen our positioning in market, in this market and grow our business pipeline. Now, having with that, the long intro into AR/MR market, our second key focus market is consumer segment. That includes all these device categories, smartphone, smart home, IoT connected devices, and wearables. With the smartphone market continuing to stagnate at around 1.2 billion units per year, growing only about 3.5% compound annual growth rate till 2028. You can see the growth rate finally stagnating, finally, as per this IDC's latest report.
But it is still by far the largest market opportunity for poLight's, with selfie AF cameras being increasingly adopted and deployed in high-end Android phones, following the Apple iPhone 14 onwards. Re-adapting it, let me emphasize, re-adopting it. They use the habit, they got rid of it, and they re-adopted it, which is really fueling kind of this re-entry and reintroduction of selfie cameras with AF across the Android ecosystem. And with rear cameras continuing to require larger sensor format and larger apertures with the multi-camera trend, you know, continuing on with telephoto and periscope zoom trends. So that's an important trend we have to keep in mind in smartphones. And we will, I will, introduce you how we're addressing in the next slide.
Smart home and IoT-connected devices, including web conferencing devices, are adding more cameras with AF enabled in behind, you know, devices. And with wearables, what we mean by that is non-AR smart glasses, smartwatches, sports or action cams, and earbuds. The shipment, the unit shipment of which are already at approximately steady stating at 440 million units per year. Not a shabby market opportunity, that we cannot ignore this wearables market. Lastly, as you'll consistently hear throughout my presentation, AI enablement using cameras and voice fusion is a common trend across this market, the consumer segment, as well as other segments that we're looking at. In consumer, we are exploring higher volume TLens opportunities.
What at the core of it is, of course, smartphones, proving challenging in the short term due to lower customer priority and lower budgets in this portion throughout the pandemic period, also in selfie AF camera space, and increasing sensor format and increasing field of view requirements that necessitate our TLens add-in architecture, which Pierre will go over in the next presentation, for addressing the rear multi-camera trends. But we will never give up on this, pursuing this target smartphone opportunity, which is by far the largest still, and by adopting, you know, new roadmaps, and standardizing and simplifying the add-in lens and camera modules architecture that Pierre will be addressing, and, you know, really developing the right roadmap to address the longer-term needs.
In the for smart home and connected IoT device space, we're actively engaging and exploring fits with top OEMs worldwide, not just in one particular region. This is why we got rid of the the regional focus there in the segment. With you know many of these POC projects nicely ongoing also across both the wearables segment and IoT connected devices. Now, riding on our existing design with customers like Meizu, our very first smartphone customer design win, which we are super proud of, and we are convinced that we can replicate this with the right roadmap focus and when we are soon ready.
We also have, you know, our leading smartwatch design wins through big brands like Xiaomi and Sony, kid smartwatches, and CVTE's MAXHUB, our webcam design win across these consumer segment. And in this segment, our key strategy, starting with smartphones, is to persistently underscore persistently explore, simplify TLens add-in lens and more standardized, lower cost, ready-to-go camera module products, to address the selfie AF camera needs in the near to midterm, while securing a larger aperture, you know, larger form factor, our aperture, TLens roadmap for the rear multi-camera trend for the long term, which our, again, CTO Pierre, will be addressing in this presentation. And to grow a strong, sustainable pipelines for more consumer OEM customers, projects globally, regardless of tier. Meaning that any and every consumer OEM customers, we will go after.
Doesn't matter what the size is, because volume is one. Our key tactics in this consumer space are to secure and promote new standardized and TLens add-on camera modules and simplify TLens add-in lens offerings while utilizing our TLens add-in reference design capabilities. Pierre has a very talented you know optical and lens design capability in-house now to leverage that to address the advanced advancing ever-advancing customer needs like large a larger sensor format and increased field of view trends and to strengthen our especially the business development side of the capability and as well as of course the local customer support you know organizations across the street. Now moving on to our third key focus market which is industrial and namely for us what's called is barcode scanners and machine vision cameras.
which offers a pretty steady growth, with the TAM, a total available market, reaching almost $7 billion-$8 billion in 2029 on five years' time, with high-performing cameras and scanners being needed for the continuing Industry 4.0 trend. While Edge AI and automation trend keeps on driving the increasing demand for camera-based machine vision and advanced sensing applications.
So one thing very, very unique about this, before I go into that, the edge AI and automation trend, that is really, driving this need, again, underscores the, the, the unique, trend that we're reading across all of the market segments, that AI and the, well, we can, you know, explore this, your questions further during the Q&A, is actually, necessitating, technology like TLens more, than displacing our technology. I will explain that to you, in the Q&A. But the one thing that is very unique about this smartest industrial market is that it's highly fragmented, with more than 10 camera and scan engine makers buying for market share.
And then lastly, what's so attractive about this particular market is that its customer product life cycles are fairly long, so once we're designed in, we stay there for many, many years, and it's being less and less cost-sensitive than, let's say, the high-volume consumer space. So it's very good revenue opportunity and margin opportunity for us. Okay, and in terms of, in the... We have continued success in the industrial barcode scanners, and select machine vision, and we're getting good traction with these machine vision cameras, leveraging the same strong TLens competitive advantages in speed, size, cost, in particular in cost in the space, because we're competing against the liquid lens guys, and unique differentiations that our technology brings, like online focused image capture capabilities.
As Øyvind mentioned, during his Q1 2024 presentation yesterday, we have six OEM customers already using TLens in their 11 commercially available products today, and increasing. Our competitors, again, are liquid lens guys on the high-end side and some from limited, some from VCM on the lower-end devices. Our key strategy in industrial is to break into more and more top-tier OEM customers, specifically in high-volume, portable, handheld barcode scanners. Not the sophisticated, super expensive these machine vision camera systems, but those portable handles, which our competitive advantages are valued the most across the board. It makes sense. And to secure system-level solutions to bridge the key technology gaps that we are recognizing. Tactically speaking, we will continue to explore TLens fits into some select machine vision projects.
Again, you know, a more select, more simplified architectures at top industrial OEM customers and to strengthen our customer relationships. We do need to improve on our deepening our customer relationship in this space, as I see it, and local customer support capabilities, while attending and exhibiting at these major industrial trade shows like NRF, which is a National Retail Federation in the U.S., Optics Fair out of China, and Vision conferences, Germany, others. Our fourth key market segment and opportunistic market for long term, as I mentioned, is healthcare, which is strategically still important for longer term.
Given the global medical camera market that you see in pictorially, show you a diagram, but it's $6.4 billion total addressable market size by year 2022, 2032, at a 7.5% growth, which is quite a nice market size, which is sizable and expanding in terms of demands. Especially in this whole healthcare segment, we like to, you know, highlight, is the neuroscientific miniscopes that require really tiny. If you think about these miniscopes, like the Kavli MINI2P brain monitoring miniscopes, require tiny form factor, yet high optical power range to really zoom in to the brain. These are, you know, we are expanding this, we're seeing expanded demands consistently from many universities and labs, and lately expanding into commercial OEMs.
However, the endoscopic camera space are staying at low resolution, 2-megapixel, 1080p HD stethoscopes, which is dominated quite frankly by OmniVision's CameraCube . With however gradual shift over to 4K, 5-megapixel cameras that eventually will require AF. Only but however in only a few years. So we this is why we have to bet longer term in this endoscopic camera set. Since our first university customer design win was announced with Kavli Institute for MINI2P miniscope back in 2022, we've been expanding the MINI2P projects across a myriad of universities and labs, and now recently into new commercial OEM customers, offering MINI2P turnkeys, which is not just the small, you know, camera stack- up there, but the turnkey solution like that. It's a system that plugs into end-to-end products.
The offering, so to expand, this will allow us to expand commercial MINI2P distribution across broader, you know, commercial players out there, enabled by our recent announcements that we've made with, you know, partners like distribution partners like PhenoSys/LabM aker. And you'll see in the next few slides, Thorlabs, to scale up this business in MINI2P neuroscientific mini scope market. We'll continue to explore this whole longer term opportunity with the endoscopic cameras as we keep track of the camera requirements heading into higher resolution, and to secure and promote with key lens and camera module partners in the space to jointly develop and work on promoting OEM product opportunities.
Our fifth and the last key segment that is opportunistic, but as we pointed out, a very important non-trivial volume opportunity, long term, is automotive. With in-cabin DMS, Driver Monitoring System, and OMS, Occupancy Monitoring System, camera market growing to a staggering $1.2 billion by a year, only in five years, in 2021. At an explosive compound annual growth rate of 44.7%, as reported by Yole in the April report. Thanks to, this is all driven by, again, the AI-enabled autonomous and, ADAS driving mandates across European regions and North America to enable more camera adoption, intelligent camera adoption, right, in future cars. Automotive is quite attractive to us, in particular, at poLight, due to a higher margin and, and pricing structure and longer type life cycles.
That once we're getting designed in, similar to industrial, we are designed in for many, many years. Although it's still at the early stages, we see non-mechanical, fast focusing, robust RGB plus near IR. This means visible and near infrared. Dual mode AF camera technology being needed, with TLens as one of solutions that are actively being considered as attractive. With some POC activities, with some lead automotive OEM customers and partners, enabled by our joint development efforts for TLens AF camera demo systems. However, again, revising and re-qualifying the TLens product, led by Pierre's team, is thus, it is required for meeting industry, you know, qualification standards like AEC-Q100 and other automotive clients' standards longer term.
Now, in order to maximize our market reach and revenue potential near term, poLight has also been establishing distribution channel with dedicated distributors like EDOM, who's covering for us in Taiwan and China and South Korea. And our newest distributor, Micron, out of Japan, who's covering the Japan region. We've also recently announced that Thorlabs has launched their TLens-based laser projection optical cage products with all flavors of our TLens product portfolio, as well as, you know, you know, we didn't totally show here, Thorlabs and PhenoSys, that I presented earlier. Those two distribution partners, who is developing and distributing MINI2P based mini scope turnkey solutions across the commercially viable OEM partners and customers. So that's really exciting.
Now, we are moving from universities and labs over to commercial OEMs, big name names deployments, using Thorlabs and PhenoSys turnkey solutions. In addition, we're in active discussions with some major global semiconductor distribution channel partners; we can't name them yet, potentially to be announced in the second half of this year. Lastly, poLight will continue to attend and exhibit at key industry trade shows to further boost our branding, our leadership position in tunable optics, and identify new customers and partners more effectively. We have very successfully completed our first ever trade show exhibition at SPIE Photonics West 2024, back in January in San Francisco, which Pierre and I was there.
Here's a picture of our actual booth, very first industry trade show booth at Photonics West, and what you see as some of the TLens camera modules and our samples on there, which I will be actually personally guiding you through after the event. Right outside the auditorium is a replica of the setup, with all of our key customer devices and our latest and greatest products and evaluation tests, which I'm happy to demonstrate for you. Now, at the next, speaking of SPIE, next year's SPIE event will be AR, VR, and MR 2025, not Photonics West, and that's making a strong, deliberate statement that we are serious and on point with a leadership position in AR and VR.
So we'll be doing that in January of next year. Very excited to do this, and taking more momentum in this whole AR and VR space. Next, we'll exhibit at the industry's largest AR, VR trade show worldwide, Augmented Expo, World Expo, AWE USA 2024, coming up in two weeks, and between June 18th through June 20th in Long Beach, California, which I'll be personally leading again, and to demonstrate our latest and greatest in AR/MR space. At the CIOE 2024 or OPIE 2025 in China, which Red Park, [Korea GM] will be leading, and Vision 2024 in Germany, I mentioned a couple of times.
Of course, we'll have our very first nice private meeting suite for the first time at CES 2025 in January, which will, you know, we will be really well positioned at CES now. That is across the board, very important trade show to address many of our focus market space. Team poLight now, as you can see, is well prepared with all the necessary trade, you know, trade show booth materials, infrastructure, product samples, evaluations, and demo kits, all kitted and nice, coupled with customer devices that use our technology. We're exhibiting at these trade shows and others globally.
As our CEO had just reported yesterday at our first quarter earnings presentation, Team poLight is very proud and boasts a very promising pipeline of customer POCs and production projects across all of our key focus segments, market segments that I went over today, all nicely summarized there to the left, as summarized in this table. With growing numbers consistently in POCs as compared to the previous quarter, quarterly report. It is my and my colleagues in the business development sales role to make sure that we lead all of these POCs to actual production project design wins, and convert them to design wins. I'm very, very confident at the scaling our business in the future. In summary, I'm very, very excited to, again, summarize where poLight is standing today.
that we are very well positioned with our product offerings in all of the key focus market, market areas that we are going after today. With this, that these market segments provide significant or growing demands with AI enablements and necessitating more and more, AR cameras, advanced cameras. In particular, TLens products and solutions for cameras and TWedge wobulator technology for AR microdisplays are unquestionably the best position in the AR market, period. With unique differentiations and potential consumer production revenues materializing in 2026 onwards. To better address the future customer needs, poLight is also securing new product roadmap, system-level solutions, local support organizations, and business development capabilities worldwide, which will further strengthen our brand and position in all of our target focus markets.
Lastly, a healthy growing pipeline of customer POCs and production project opportunities across these top target focus market areas that I went over with you today, will allow us to build the momentum, to scale our revenue, and fuel a very sustainable business growth long term. Thank you very much.
Super good, Tristan. Thanks a lot. We will, we know you of course used 10 minutes more than you're supposed to do, but that's great. It's fine. We have time. We break, fill up the coffee or water, and we will be back again. Let me see. Let me see if we're gonna start again with our CTO at quarter to three. Okay. Are you kidding or...? I think your 10 minutes is over, but I saw we have some like -
[Foreign langauge]
So Pierre, you can have a water ready. No, the mic is there, so don't.
Yeah, but that's not a good idea. Let's keep it there.
[Foreign language]
Aha! But I can hold some voice.
[Foreign language]
Coffee, no need? Mister, I need some coffee. That's yours.
And then where are we?
Okay. Hope you enjoyed your break. We're gonna continue, and next on the agenda is technology platform and the roadmap with our CTO, Pierre Craen. He's from Belgium. He's commuting to Norway and Asia and U.S., all over the world. Pierre has been with us for soon 14 years. He is instrumental in what we have achieved and what we're gonna achieve. Pierre has a background in his... How many degrees do you have? You have a lot of master in physics and optics. Very strong background. He is actually coming from tuning optics. He was working with competitors, but finally, he understood what is the right tuning of optics. So those words, Pierre, I will let you give your speech.
Thank you, Øyvind, and thanks for to Tristan for introducing. But, Øyvind, where is the presentation?
Sorry, I will help you.
You're leaving me in the middle of the...
It's not so difficult.
No, I know, but it's,
But you are being a CTO-
Yeah, yeah
you should know.
Voila! Thanks. Yes. So, and thanks, Tristan, for the fantastic opportunity that we have in front of us. R&D team is, of course, very dedicated to make that happen. And before diving into the technology and what we're working on today and in the future, I would like to just remind you what is all about the platform and the tunable optics technology and platform of poLight. Then I will give you a quick update on the IP status and strategy, and then we'll dive a little bit more into the AF and the TLens product and roadmap for activities of what we do for simplifying, enhancing, improving, or readiness to address those different markets.
Then we will talk about bigger TLens, because that's relatively important to develop those solutions also for the market that we are addressing. To finish with that new functionality that we have developed, well, not totally new, but at least we have put a nice name on it, which is a TWedge. And the first product that will most likely come as a TWedge is the wobulator, that small device which is improving the resolution of the microdisplay, which seems to have a big momentum from the customer and the market. To finish with a quick summary of where we believe we are.
So just as a reminder for the new people which are on board, what is the technology platform of poLight? So, it's conceptually relatively simple. It's a piece of deformable optical material, which is sandwiched between two optical components, relatively high quality optical component. Sometimes you could deform that one of the optical component, that's the top part of that animation, that's creating the focusing. The contracting of the actuators is bending the membrane, the optical component, and creating focusing, thanks to the polymer following the shape.
Or you can also introduce some tip, tilt, and motion on the back, the lower side of the animation there to create a wedge, which will deviate the beam. With those type of application, we can create the wobulator that we will discuss a bit more in details later on. So today, we have the TLens autofocus. We have the TWedge, which could be. It's a new family of product, I feel. The first one will be the wobulator and the microdisplay resolution improvement, but it could also be further developed to do optical image stabilization in different manner.
It could also be combined, as on the animation, that will come as a, I would say, a third step when the OIS and the wobulator will have been proven to work and put on the market. We could potentially also offer a solution where we combine focusing and image stabilization or beam steering. Another thing that we started to contemplate also, but it's only paperwork and nothing more than that, but we are, of course, working on that, is the cylindrical lens and tunable cylindrical lens that could also potentially have some application in AR/VR market for correcting basically some weaknesses that most of us has in a way. We have some astigmatism very often, especially when we're getting older.
And then, we will continue again to push for solution that could enable and make optical zoom, which I still feel is a wet dream for most of the, especially the mobile community. They would like to have a tunable optical zoom, which is a challenge. But anyway, we are moving towards that. We are pushing to try to offer solution for that. And all those concept are using actuators. Most today, thin film piezo that we want, and we need to continue to improve for better performance. But we are also addressing different type of architecture. We'll see that later in the slides, where we use bulk piezo, potentially also other type of actuators.
We like to stay with piezo because they are fantastic actuators, they are low power consumption, they are fast, and we know them quite a lot. So far, all the performance of the TLens are basically really coming from the piezo material, and the PZT in particular. We will continue to develop those optical materials, soft optical material, that needs specific tuning for different type of application. So that's what we have as a key platform to work and develop new functionality and new products. So in terms of IP, I will probably repeat what we have said already, but for us, it's relatively important. We have 22 patents, worldwide granted patent family.
Used to be 17 in 2022. So you see that we are pushing, we are improving, we are creating more IP. We are still seven more pending applications, meaning that they are on their way to be or patented or. And we have three to five applications in preparation. So, about 10 new applications which will come relatively soon, which will take time to become granted. Of course, you need to. The way we have taken is taking a year or two or three , depending a little bit. And we have added one registered trademark, which is the TWedge, compared to last year.
So on the right side of the image, you see the repartition of the patent over the world. So, and then those 22 family are around probably more than 160 granted patents. So we believe that we are relatively well-protected. Even the very early very earliest patent that we have applied, even before I joined, are still not yet completely valid. But the most important one, the one which are really supporting the current product, are potentially still valid for eight years. And of course, we have continued to apply for new and more patents. So we believe that we are relatively well-protected. The strategy is the same as two years ago.
We continue to push as much as we can to secure the freedom to operate for poLight, of course, but for our customer also, super important. So there are three ways to do that. The first one, as you have seen, that we continue to apply for new IP. I would say on monthly basis, we have discussion, we have talks with the team to see and to understand what we could patent. We are working with a law firm also to support that effort because it's a lot of work. Then the trade secret are something that we are very important. It's also very important to keep in mind everything which is very detail-oriented and related to processes.
We would like to keep it as a trade secret, because if you make an IP, you disclose everything. So that's a kind of deal that we do. When you get an IP and granted, you need to open as much as you can to help the others to potentially reproduce, even though they don't have the right to reproduce, but still you open it for what you do. And that's why trade secret is also quite nice way to preserve and protect poLight. And then we do, through all those activities and participation to the conference, and we do defensive application.
So meaning that we are publishing information that we believe are not super important from the IP strategic point of view for poLight, but still, are important to secure the freedom to operate for our customers, for example. So this is exactly the same strategy that we have been using couple of years ago already and for many years at the end of the day. So that's the status of the IP, so still growing. So now we can talk about the TLens and what are we doing for helping and supporting the future business. So quick reminder again, TLens, that was the top part of the first animation.
The TLens is, again, polymer sandwiched between two, component, optical component, and the top one is the MEMS. We should call it MEMS, but it's a silicon frame on which we have attached a glass membrane, and on top of which all the layers, electrodes, and the piezo has been deposited. And by applying voltage, you're contracting and bending the membrane, which is shaping the polymer and creating the focusing. So this is the TLens. And in the last years, we have, of course, created that add-in design, reference design, which is in mid soon now, so we should be quite proud of that. That was the first add-in design which has reached the market. So we have designed around the TLens.
We have also generated those stacked lens solution for the MINI2P solution, which basically enable to get more optical power by stacking, like if you put resistance in series, you can create more focusing range. And also to support those activities, we had to apply another anti-reflective coating, because those devices are not working in the visible spectrum, but more like in the infrared spectrum. And we have developed processes to apply coatings on the TLens also to address those type of niche market applications. So we can deposit enhanced ARC anti-reflective coating for visible, but also for near-infrared, for far-infrared, for near-infrared and visible. So we have a multiple solution there that are important sometimes for some application. Then the curved back window, this is something that we have proven a long time ago.
This is still on the key, great technology to be used in the future, but so far, I will explain you why we don't push too much on that, but that could be, of course, the next step. And we have also proven that we could implement filtering function in the TLens because the back window is a flat window, so you can put more optical functionality there. That's ready to go also. It's ready. We just need to wait for the opportunity and wait for customer interested in that kind of solution. So the future, of course, is the big useful aperture that we talked about and that Tristan mentioned.
And again, we need to work on all those activators and material for the future. A slide that I've been using two years ago, same thing, nothing has changed. At that time, we were still claiming that add-on will be there for some time, and it was really important to continue to push and sell those products. But we see more and more that adding TLens is becoming super important. It is important. It has been important to get the first design win for the mobile, but it's also important for AR, VR, MR.
So that we are really now focusing on that, because the first experience that we have had is the Mate X phone has demonstrated that there are not many companies that can implement adding in a TLens solution. So we need to continue to, because it's not complex, but it's new, and the TLens is coming with its own, not limitation, but requirement to make a good integration. So what we are now trying to really do based on that experience is to simplify the solution around the TLens, which will enable easier use, faster adaptation by many other lens maker and more and more lens makers.
So we're gonna focus on that in the coming—for this year, in the coming year, I believe. And as soon as that will be more widely accepted, then we're gonna be able to implement the next level of, I would say, advanced integration, where we can put—we start to put curved back window in the TLens. Curved back window will come with more sensitivity around the design frame, for example. And then we will also move to the next step after the step of implementing the back curve window, which is coming with new freedom for making the design more compact, better quality. It's one more degree of freedom to optimize the lens system. And then move to the next level, where the ultimate goal that we go.
Hopefully, we will achieve one day is to have a real lens, tunable lens with a lot of optical power, but tunable. So that would be the really super top solution that we would like to push for, but that will take time, of course. So the first short-term focus that we have been, and we're working currently on, is to come with a solution to integrate the existing product, the TLens Silver and Silver Premium, in a more easier manner on the adding TLens concept. So we're working on three different concept of package, plastic package around the TLens, which are, two of them are based on LDS or laser direct structuring.
That process is becoming more and more mature, still not fully, fully up to high volume scale, but still, it's coming, and we believe that that technology is enabling us to have a very versatile solution. So you can take that TLens package and put it in a system, and connect it from anywhere. So bottom, top, side, which is sometimes today, a delicate issue because it's limiting the degree of freedom, because the connection of the TLens needs to come from the top in a way, somehow here. But with that package, we could do any... and I will show you some examples how to use that.
Also, we have put very high priority on the size and the dimension of that plastic parts, to be as close as possible as the accuracy of a plastic lens that they are stacking to make the full lens stack. So that's super important. Even though the TLens doesn't need to be the concentricity and the alignment of the TLens itself doesn't need to be super accurate, but still, it's good to have those data to make the things easy, so that people will integrate the TLens as a plastic lens in the lens stack. The last one is the fourth, the third one, sorry, of the solution with the metal sheet.
This is more like a proof of concept that we want to keep moving in case of the LDS doesn't come with the right performance and the right cost, even though we believe that it will come. It's just a kind of pure R&D activities that we still want to investigate. The difference between the two packages there is that one has been... you don't see that very easily, but one has been optimized in terms of in-plane dimension, XY, so very small diameter, as small as possible, but a little bit thicker because we need to put some material to make the plastic frame rigid enough.
The middle one is only basically a super thin solution, the thinnest solution that you can go, but the consequence is that the package is a little bit wider and bigger. So depending on the design that we need to fit in, one or the other will fit. So that's why we're trying to also propose solution which will make things easier in a way, depending on the lens type. So thanks to the team again here, we have continued to design lens, adding TLens, lens for different type of application, and that's one of the example here.
We have even done the optomechanical design of the complete lens to validate the concept and to share with some customers, which are not super, I would say, aggressive enough to go in, and we use those reference designs to convince them that indeed it's possible. We have done tolerance analysis, we have done the mechanical, optomechanical design and we start the discussion around that, and we provide all those information to them. So they have the lens design, Zemax file, the CAD file, everything, and they can start from there. They will save a lot of time. And here you see that on the left side, you have a super compact, small nose camera, which could fit to a mobile or AR/VR.
You see that here, the connection to the TLens is coming from the top. You see the package in the middle here, that's the TLens here, and the connection is made from the top. Another lens design that we have been working on for the back cam, which is a wide field of view, relatively big sensor, is that the TLens is just sitting in between two, the two lens stack. You have two lens at the front and four lens at the back, and here you see that the connection to the TLens is made from the side. Different designs.
Those designs, very often, are requiring some active alignment because they are so demanding in terms of megapixel and resolution, that very often the top lens or the first group on top of the TLens needs to be active aligned with respect to the bottom lenses. And that's something that we are also working with partner to try to simplify as much as possible. The small package that we have designed, we believe can do that. So that's another example of another type of lens stack, where you see on the left side here, you see the group one and the group two, and the TLens is sitting in between.
Here, the group one is sitting directly on the group two, because the thickness between the group one and the group two needs to be super accurate, and even though the package will come with high accuracy, it's already too much to. And it could affect the performance of the lens at the end. And the other design is a design where we basically sit in group one on the package, which is sitting on group two, and then that solution will, of course, suffer. But again, only if it makes sense of sitting on the package and reducing—increasing the tolerance and potentially address affecting a little bit the performance. But if it's a lower megapixel camera, that is potential solution also.
Again, those designs can be used for mobile, AR, VR, and wearables. So another example of the type of work that we do, we're moving, and we're trying to dig into the details of how they're gonna do the integration of lens stack with the TLens. So basically, you take the barrel, and then you shuffle in the firsTLenses, then you put the TLens, and then you stack all the lenses at the back, and that's something which will enable and make easier adoption of those adding concept to the lens maker. Of course, that needs to be compatible with the performance of the lens, but for some application, like industrial, automotive, where megapixels are a bit lower, that's those solutions are potentially applicable.
Another type of example that we do, it's, again, another lens designs for super wide field of view, is a system configuration where we put the lens after assembling the lens stack. So basically, the lens maker will assemble the lens the way they do regular. They like to do that because then they're controlling their quality. And when the lens is good and in spec, then they can integrate and slide in the TLens from the side. And again, there you use the small package, little some feature to make electrical connection, and you just slide that in, and you're supposed to have an autofocus lens, which is really top quality, because the TLens will be tested.
We're testing 100% of the lens in the package, so things will come out with relatively good yield and high performance, and that could be a solution where the compactness of the camera, the size of the camera, doesn't need to be super small, and the resolution is not in the 50-megapixel range. Okay? So that's the type of activity and model and reference design that we're developing to support the deployment of the existing product. When it comes to the product itself, so we have the Silver and the Silver Premium. We have demonstrated the TLens Platinum, engineering sample level available, and we're just waiting for customer request and opportunity here. Ready to start as soon as there is a big demand.
That will enable to address even bigger and lower F- number for cameras. Then we have the even bigger aperture TLens, which we call Diamond TLens, which we have decided today to develop on a completely different architecture, and I will describe it a little bit more later on, but it's again the same concept, membranes, polymer in between.
And then we have that little TLens Micro that I like a lot, because that will be based on the same lens architecture, which also is basically, I would not say ready to go, but which we are waiting for a real demand, and we start to feel and see some demands for consumer market, where they want to really miniaturize the camera as much as possible, and that's, those multi lens could be a solution for those. Because then VCMs will have hard time to fit in the box also. So, medical, telecom, AR, MR, also wearables, that's definitely the potential target for that. So then about the big, the big useful aperture. So today, we have started the project this year.
Different concept, I'm only describing one so far, which is using the polymer sandwiched between two membranes, and we have an actuator, which is compressing the polymer, which is slightly different than what we have today with the TLens. And of course, when we do that, we need to be very careful on developing the right joint, so that when we're pushing and retracting, we don't deform the membrane in a non-spherical manner. So that's super important. And we need also to make sure that we don't hyperstatically fix the edge of the membrane, because then we're gonna lose the focusing range completely. So that's what we do today.
The simulations are really promising, and we will make prototype by the end of the year to prove the concept. There is another concept also moving in parallel, and we are also developing a concept for the actuation, which are based on piezo element, piezo material, but they will be bulk today. So today it's bulk piezo based. In the future, that will potentially migrate to a MEMS thin film piezo. And you see that those bigger TLens, which will be in the range of four to six-eight millimeter diameter, will be basically fitting into those telephoto cameras.
As Tristan mentioned, the trend on the mobile is we need to push to higher sensor format, higher megapixel, lower F-number, and VCMs has really hard time to support that, because if you go for bigger sensor, bigger effective focal lengths, you need a huge stroke, and the lengths are very big, and the VCMs cannot do one millimeter stroke. And if they do, it will be very sluggish, very unreliable, and that's where the tunable lengths are really, I believe, coming with as a solution for that. So that's what we're working on. Okay? So then the new baby, the new product, new functionality, this is the TWedge.
The TWedge is that beam steering capability. You see that again, based on the technology brick polymer between two piece of glass window, and you have actuators, which are pushing to create the bi-directional shifting. It's an angular shift, which is translated in a pixel shift in the focal plane of the optics. So basically, by shifting by half a pixel, you make two by two improved resolution, which is four times improved resolution. So this technology also for the first product, I believe, will be based on bulk piezo, but that could definitely be migrated in the future when the volume will make sense to go for MEMS.
We could replace those bulk piezo with MEMS actuator, still under development, but there is some hope that we will be able to go that direction. You're gonna see a demo. We have done three technical samples. The first one was really the first concept proof. We went for TS2, which was the first size reduction, more product-oriented type of designs that we have used to sample some customers to learn if it was fitting their performance that we had to go for. And now we have recently assembled the first TS3, which are more to fit the requirement of most of the AR/VR customer, we believe, and you're gonna see some samples of that one also.
So just to give you a little bit more information about where the TWedge will be implemented. So you see it on the left side here, you have a waveguide with a light engine on the top there. And that light engine is basically the microdisplay with a precision optical lens to form the image through the waveguide to the eye. And the TWedge will be inserted in between the waveguide and the optics stack. So that's where the device will be positioned. Okay?
So then to summarize, obviously, R&D team is fully committed to develop and keep developing new solution and key break technology for supporting the future opportunity of poLight by focusing and developing continuously more IP, implementing continuous improvement on the TLens, like ARC. There are potentially other things that we need to improve in the future. Continue to develop the solution for adding support customers. Obviously, the two last bullet are the most important one, and that's the time in the Diamond TLens. We need to keep pushing to come with solutions there. Of course, Platinum and Micro are in standby and hopefully will be triggered by a customer in the future.
We are creating that new family of product, which today is TWedge wobulator, but it could also be extended with more range to really optical image stabilization in different form factors. So last two years ago, we give you a other information about the folded structure with OIS. Those kind of things are still on the roadmap, and we're working on. We are doing simulation. We're waiting again to get some momentum from customers to push a little bit that more to the next step. Okay?
Thank you, Pierre, for a fantastic presentation. Next is Marianne. Marianne is COO. Marianne has been working with me for 21 years.
Soon 22.
Soon 22, can you imagine? And in three different companies, she has been always managing kind of the operational setup and manufacturing. So, Marianne, we're looking forward to your presentation. I think maybe this is gonna give a little bit more, like, easy to understand. It's not that it's easy, but, it's the way she present it is, will come across, as an easy touch. Enjoy, Marianne. Do you want me to help you to—Good. And share, and what do we share? Slideshow?
Yeah.
Okay. Are we good? Can we check if the sound gets through on it? Okay, good. You have the sound? Is the sound on? Yeah. Okay. Marianne. The floor is yours, Marianne.
Thank you very much, Øyvind, for the kind introduction. I'm very proud to present the operational setup of poLight.
Yes, it's Marianne. So look at the paper, please.
Yeah. All right. As Øyvind said, poLight, we are a fabless company, except for the polymer. We decided to maintain polymer in-house. So for the MEMS, piezo MEMS, and the assembly test, we have signed up with professional partners. We do prototyping, sampling, low volume here from headquarters. When it comes to the optical, or the polymer, the optical gel, that we have used the last 10-15 years to optimize, we do that in-house. We do testing of all, critical parameters before we ship it from here, then we ship it as a two-component, material in syringes to our, manufacturing partner. There, we will do mixing, we will do dispensing, and we will do curing. As there is a long shelf time on the polymer, we also maintain buffer stock at our manufacturing partners.
Another area that has been very important for us, is the data management area, the handling of all the test data. As Pierre said, we do 100% testing of all TLenses, and for each TLens, we have around 200-300 measurements. In addition, we have quite a lot of images. So it's all about securing that we have an efficient system to collect, analyze, and report. So this is key for us to work on instant problems, yield improvement, quality improvement, and product optimization. It's also been important for us to have a setup here at headquarters, where we can replicate more or less what we do in the MP line.
So we have had the opportunity to invest over time, and today, we can both support our colleagues remotely, we can work product quality over time, and we can also support customers that might require a special support during their proof of concept. Then, what about scalability? No doubt that when volumes comes, we will also look for second source. That will also be a risk mitigation of the volumes. However, as long as we don't have the real volumes, we will wait. So second source for benchmarking and risk mitigation, scalability will be done when volumes increases. Then, about test. As Pierre said, Test is extremely important for us. We have developed our own dedicated test equipment together with test equipment suppliers. We have built a lot of competence internally to secure scalability or flexibility and quality.
And we will do, in addition to 100% test, we also do 100% outgoing quality control. Øyvind talked about the importance of building local strength close to our manufacturing partners and close to our customers. I will come a little bit back to that later in my presentation. On quality control, we will record all the test data for each of the TLenses. Traceability, both when it comes to the data and the material, all the way from the MEMS wafers through our supply chain, until we deliver to the customer. It's also been important for us to build an efficient quality management system, where we secure we, at any time, have the updated documentation and that we secure any changes, deviation. Customer confidence, what do I mean with that?
The customers evaluating the TLens technology will, for sure, also evaluate poLight's capabilities of ramping, of producing in mass production and doing the ramp. They will also make sure that we have an organization in place, that we have system in place to handle the orders, the mass production order when they come. We have invested in the sector, and we will continue to do going forward. So even if the volumes are moderate at the... or low, moderate at the moment, we will continue to load. Because we have to continue to professionalize ourself, we have to continue to work on yield improvement. Pierre explained the TLens, like, the polymer, the optical gel that is sandwiched between two high-quality glass. It's the MEMS wafers, the polymer, and the glass that are the key components in our supply chain.
We ship these pieces to our assembly partner. Here, we'll also do the test before we ship to customer. When it comes to the MEMS wafers, as I said, our partner is ST Microelectronics. We've worked with them since 2013, and we have together developed the advanced optical MEMS actuators. The line we have today is very scalable, prepared for high volumes. The polymer is also very scalable. We used to say that about a liter of polymer is about 1 million TLenses. So we have no problem to deliver from here, whatever volumes is required. When it comes to the glass, that's we have several suppliers. It's our assembly partner handling this. However, it would be poLight that makes the specifications and also will approve the suppliers. Our assembly partner is Tong Hsing. We also work with them since 2013.
We started in Taiwan. Two years ago, we moved the whole production line to the Philippines. The reason so is that that plant is better suited for high volume, low cost. The line we have today at Tong Hsing, and I will also show a video, is fully, fully automated. The test, as I said, also at the assembly partner. However, today, poLight is operating the test ourselves. We will not do so when the volumes get really high. Then our assembly partner will handle also the test. However, today, we still like to be very close to the test. It's also us that have consigned the test equipment, so a part of our team is continuing to focus on the test part.
Then I very much would like to show you a video of how we build the TLens. I know some of you have seen this video before. However, it demonstrates very well how we do the manufacturing processes, so I hope you are fine to see it again. I would also like to thank Ole Morten Ruud, which is our manufacturing specialist, that is the producer of this video.
poLight, leader in tunable optics technology, provider of the TLens, lightning-fast autofocus solutions for mobile, consumer, barcode, augmented reality, and many other markets. In this video, we are going to take a closer look on how the TLens is manufactured and assembled... Starting with the bare TLens, followed by the packaged TLens, an add-on solution for customer integration. We will also give a brief introduction to final test at the end of the video. To understand the manufacturing process of the TLens, we need to first break down the main components. There are several TLens product types depending on the customer need, but they all share the same build-up. Unlike the complex competitive technology, such as VCM, the TLens can be made with only three components: glass, optical gel, and MEMS wafer, each part with a dedicated process flow. Let's begin with the glass processing.
Glass processing starts with a big glass panel, thinner than a normal piece of paper. In the world of optics, keeping all parts clean is extremely important. That is why the glass must be thoroughly cleaned before further processing to meet the tight specifications of poLight. All panels are carefully placed in a special holder to prevent movement during the cleaning process. One holder can fit glass for tens of thousands of TLens. The cleaning process is a fully automatic system and will ensure all the quality requirements are met. To prepare the big glass to be cut into smaller pieces of glass, each glass panel is mounted to a tape on a metal ring. This ring is then fed into a dicing machine.
This machine is a fully automatic system and will cut the glass panel first in horizontal direction, then cut vertical direction with high accuracy, speed, and precision. The result is smaller singulated quadrants of glass, known as glass die or glass units. When the dicing is complete, the panels are carefully inspected and measured for quality assurance by automatic equipment to make sure they meet the high quality standards of poLight. The actual build-up of a TLens is done on a metal frame, usually referred to as a strip or a boat. Each strip marked with a unique code used by the machines to keep full traceability throughout the entire manufacturing process. To put the glass die on the frame, both frame and glass panel is loaded into an automatic die bonding machine.
The machine carefully picks the glass and place it on strip in a fixed matrix with very high speed and precision. When the matrix is complete, the machine will put the strip into a dedicated magazine. As you can see, the glass dies are now spread out on the frame, and this completes the glass processing. The first processing step is now complete. It's time to look at the second step: optical gel processing. The gel is a patented polymer, developed and manufactured at poLight headquarters in Norway. It's provided as a two-component material in a dual syringe for the most possible convenient handling. The two components are mixed using a dispensing gun and a mixing tip that has a clear, transparent liquid form, as demonstrated here.
The optical gel is not only a key optical component, it's also designed to be the very glue to keep the glass and the MEMS together, as you will see in the third and final process flow of the TLens. Before we continue processing the optical gel, we need to prepare the third and final component of the TLens, the MEMS wafer. The reason for this is because the optical gel and the MEMS wafer will be processed together in the final step. The very heart of the TLens is a piezo element that originates from an 8-inch silicon MEMS wafer. Similar to the glass processing, the wafer is mounted to tape and metal ring, prepared for dicing.... Once again, a fully automatic process will ensure each MEMS die is singulated with micron precision.
After dicing, the wafers are carefully inspected and measured by fully automated equipment to ensure the best possible quality assurance. The wafer with singulated piezo MEMS actuators is now ready to be combined with the glass and optical gel. All components are now loaded into the same bonding machine. The polymer is ready to be dispensed on top of the glass units. A frame with glass units are transported to the dispensing area, and the optical gel is dispensed on top of the glass. When all glass is filled up with optical gel, the frame is moved to the second position, the bonding area, where the diced MEMS units are placed on top of the polymer and glass. This means the polymer is now sandwiched between the glass and the MEMS. Let's slow down the machine to see what's going on.
Notice how the auto-focus in the camera cannot keep up with the machine speed. If only we had a TLens inside. Thousands of TLens is ready for curing, making the optical gel move from a liquid state to a solid state. After curing, the TLens is complete and ready for final test. This concludes the bare TLens assembly. Before final test, let's take a quick overview of the packaged TLens, a solution for easy integration for camera module vendors. The package is two additional components to the bare TLens. The first is a small plastic frame with metal pins, called the package, making electrical connection from all sides possible. The package is bonded in the same way as the MEMS, surrounding the TLens. Then, the package is glued to the TLens on all four sides.
To ensure electrical connection between the package and the TLens, wire bonding is used for the best industry-standard connectivity. The final component is an extremely thin optical black part that goes on the backside of the packaged TLens. Therefore, the complete stack of TLens and package is picked from the frame and placed on top of this new component. This concludes the packaged TLens manufacturing. The parts are now ready for final test. poLight is testing 100% of all parts. After the material is loaded into the machine, each part is picked up to a rotating table. Each position in the table is a dedicated test. Optical and electrical testing. Top side inspection. Bottom side inspection. Results from each test can be seen on screen in real time. Based on the results of the test, the material will be placed in different output area.
This concludes the final test. Parts are now transferred to plastic trays, ready for packing and shipping to customer.
Thank you for watching.
I hope you enjoyed that one.
Absolutely.
I would like to say a little bit about the manufacturing team we have built up in the Philippines. As Øyvind said, we started off with traveling with suitcase, following up remotely from here. We also have used a lot of the R&D resources the last couple of years. However, now we need to let Pierre focus on the R&D going forward. So we had opportunity to build a local team close to, or at the site of our manufacturing partner. So currently, we now have seven people, skilled people, within individual various field of expertise, and each of them have more than 20 years of experience within the semiconductor and electronics. And they all come from mass production, which is a good experience to bring along. I have a management team.
Esther Banas is doing the complete supply chain management, also used to follow up suppliers or manufacturing partners like Tong Hsing. Lowie Reynes , coming from manufacturing, assembly and test, also yield improvement. She is heading the local team. Just recently, Ephraim Estepa , long experience within automation, engineering, test equipment, so he also joined the team. A little bit about the experience of what we have produced the last couple of years. During the three last years, we have produced more than 1 million TLenses. Most of it has been delivered to customers. Some has been lost in yield, and some is in inventory. As I said, it has been important. What we've seen clearly is that we need to have product process specialists close to the manufacturing partner.
We also, as we've been working with several type of customer, customer segments, we see that they... there is various test data that is important for them. So we had to expand, we had to be more flexible in, in our test setup, and we also see that there are customer that would like to receive a certain test data sorted in the deliveries. So we have also prepared for doing sorting, according to customer requests. Then you will ask me: "What is your yield?" And our target is to have a yield above 95%. We are not there yet, and we will need more volumes to get there. However, what we have seen of a production, it's feasible to reach it. We need to continue with our yield improvement programs, and we need to load more, more volumes.
But we feel confident that we are going to achieve our target. During the last years, we also have had several customer audits from well-recognized customers, and I'm very proud to say that each of them, we have had a positive outcome. We have passed. And so all in all, we have delivered high-quality products to all our customers. Looking through the returns we had during the last couple of years, is extremely low, I would say negligible. And we have, as you can see on the bottom of the slide, we have really supplied TLenses to all the market segments. We've been in the consumer, the webcam, the smartphone, the smartwatch.
We deliver to the AR, MR, and we deliver to the barcode, and it's all been demanding customer, so we really have had to prove ourselves. So summing up, as I said, we have, over the years, worked closely with several recognized customers, demanding the superior quality and reliability, which has allowed us to maintain a high standard, and we have done fine-tuning of our offering to adapt to the different market segments. We have today a strong local organization that I'm very proud of, and we have a well-prepared supply chain capable of handling various ramp-up scenarios. So what are we going to do going forward? We will continue to load. As the orders, more of the orders coming in, we will increase volumes.
That will improve the yield further, and we can start to achieve our cost optimization targets. We will for sure continue to work on optimizing the product processes. We will work closely with the customers. We need to understand the ramp-up scenarios. We need to understand, based on the capacity we have, what do we need to expand the capacity when, and we also need to follow the material needs carefully. And not to forget, just as important, we need to continue to maintain the strong relationship we have to our manufacturing partners. We have really invested time and efforts together with them. We're going to continue with them. They are just as important for our success. So years of investment in professionalizing our supply chain, manufacturing, and successful deliveries have made us confident in our ability to run.
Okay, Marianne, you can just start with me here. And Pierre, Pierre, Tristan, will you also join me for the Q&A session? Lars, is there any questions for, from, from the work?
Nothing yet.
Nothing yet? Okay, if you can talk, we simply, you know, we are so close anyway.
Keep going.
Yeah. Are we all visible?
Yes.
Okay, any questions from the audience? I guess it will be more convenient to ask questions outside, but the problem is that then the other guys will not hear what you ask. But anyway, you decide. Any questions? Yeah, Dan?
You have a lot of data and a lot of secret trade information. How do you cope with the data security?
Data security on.
Yeah, data security. Exactly, to one is the more, the data systems and hacking problems and things like that.
Okay.
The other one is that people are not gossiping outside the company.
Okay. Marianne, would you like to try to answer to that? It is, of course, we have actually recently had an external investigation of security of our IT system, and so they have been kind of classified as adequate. When it comes to, what should I say, Dan? When it comes to that, we are not kind of spreading and telling the competition or others confidential information is of course something we cannot completely control. But what I can say and what I feel is that to do what we have done, it takes more and information, the bits and pieces of information. It also takes the need to tap into the supply chain, and I think it will be extremely difficult to replicate.
I think then it will be easier and faster and cheaper to buy the company. It, it's gonna be extremely difficult to replicate from outside. I don't know if I answered your question absolutely correctly, Dan, but. And then we had other questions, huh? Yes, please.
When will poLight make the first high-volume shipment, giving significant revenue, and for what kind of product will that be?
Extremely good question, and of course, difficult to answer. But, as Tristan said, we are focusing on different market segments. Smartphone will of course will be that volume, which today represent high volumes. Pierre have explained what kind of initiative we takes to kind of ease the implementation of TLens. So anyway, smartphone, high volume will be the what is kind of closest to us. Then, of course, to get into the back end, we need a bigger TLens, which is a few years ahead of us. But selfie camera, which is, Tristan said, is gradually coming into more and more the high-end phones and mid-end phones, and in the end, low-end phones. But then we need a system solution using TLens, which is significantly less expensive than it today.
That is not so much related to the component cost of the TLens, but the way they do it, and that's what Pierre tried to solve, that they can do it in a simpler way, enabling more camera module suppliers to do the same, which the more high-end guys do today. But that is kind of the, the most, I would say, closest to us. Then, as Tristan said, AI market will have a fantastic position. Tristan also mentioned, without having my
Guidance.
Guidance or blessing, but he did anyway. No, I'm kidding. In 2026, there should be possibility to see a consumer AR/MR supply from the company. Okay, any other question? Yes.
Coming from an originally military background, it's interesting to me, for me to know, the defense market. Have you looked at that specifically, or just a part of the whole package in a way, whereas TLens is a part of a whole system that can be used both in civilian way and military way?
As far as I am aware of, Pierre , I don't think we have been addressing the military market. The only thing, from top of my head, correct me, Pierre , if I'm wrong, but I'm thinking a little bit about this very small drone technology, which I think maybe sooner or later will have the need for potentially this kind of technology, could be a, could be an application the way I think. Yes, please?
I just meant that. Is that with your obviously brilliant auto-focusing and combined with zooming would be perfect?
Yeah, I think there should be something there, I feel also. Yeah. Yes. Tristan, yes, please speak up.
I would answer it indirectly, or, you know, as you heard me present, in the AR/MR space, in the enterprise, we call it the, we have two enterprise segments, which is an industrial professional segment and consumer. On the enterprise space, we cannot name which customer, but our enterprise customers do address that market segment.
True.
Uh, yes.
True.
So we're indirectly the-
Yeah, incorrect. You're right, yes.
But, I would say not in a major, you know, fashion, but it is definitely, some of them are i n that segment, yeah.
In that segment, yes.
And then if we police can be seen as a military.
Yeah, yeah. poLight also is, in a way, at least it's in that direction you take a body cam, stuff like that.
That's something that we have been addressing.
Yes.
Yes. Dan again, yes?
Yeah, yeah. Even you have said so many times that for a small, how should we say, dedicated company, you have to limit yourself to not being all over the place.
Except for maybe automotive, you're in a very many places.
Now today, we have seen that you are also starting up a lot of new, very, very interesting products.
But how do you really have resources to do this?
Will you be able to sort of put a balance on the efforts you put on the, how should we say, the high yield ones and the maybe ones that will take long time and maybe not so high volume? I guess they're all... the easy answer is yes, but maybe you could expand a little bit on that.
Yeah, but I think it's a very good question, and it's a very good comment. Are we focused enough? Are we able to deliver on what we are trying to... all the activities we are trying to do? As I said in the beginning, we were laser focused on consumer, and we didn't do anything else. We shut the door for everything else. As we matured both the organization and the product, we allowed for incoming calls to get attention. What we now have done is that we have defined three segments, but the priority is very clear. If there is a smartphone project coming in or we find, that will get all attention. If there is another consumer project coming in, that will get all attention.
If there is an AR/MR project which will be a consumer related, it will get super high attention. So in a way, the priority is very clear. I think that having clear priority means that we, as management, we can, before we address new cases, we have weekly sales and market meetings with all the VP business developments, discussing opportunity and putting priority. Need support, do not support, customer can do it themselves or not, do we need to use resources from PM or my other? So we do that kind of, obviously, live prioritizing so that we don't miss the opportunity. We have defined key strategic opportunities.
So I think we manage that in a good way, but still, I've been managing tech companies for 30 years, and I always said, "Doing too much, too early is a recipe for disaster." I don't think we are on that track. Yes, please, yeah.
Yeah, a short question, regarding we've been through a funding process now securing a financial.
Yep.
You said that this is very important for potential customers.
Yes.
I was wondering if you could elaborate a little bit more on, which kind of customers have wished for a more secure funding for this?
I would say, yeah, so, you're saying that funding is important. I've said that. Yes, that's correct. And why am I saying that? It's basically based on, I would say, experience and history. And of course, when we are working with big names, which we are, and small names, but they are definitely very professional in the kind of process of selecting technology and suppliers. So typically, what they will do before they do a lot of investment in the POCs and testing programs, they would like to understand, okay, say, if we would like to use, can this company supply? Are they sustainable? Can they, will they survive?
Will they have the cash to survive and supply us for in 2028 and so on? So they are typically then dragged into kind of due diligence meetings, of course, where they ask me about business plan, financing, and that's why we said that we- and of course, if I'm sitting in those meetings with NOK 10 million on the account, that will be an end of the meeting. So I need to make sure that I can show a solid financial situation for them to dare to take the next step. So this is happening, this kind of questioning is coming up in all, I would say, cases where you have a significant type of company with a professional organization, always.
Just the same as they ask Marianne, can you ramp? Do we have the capability? And if we can't, if we are starting flapping with a blink on those questions, we are. Yeah, Dan?
Marianne, you were talking about second source, and y ou didn't want to start that until you have enough volumes, which makes sense. But sometimes customers are really demanding second source. How, how have you, have you experienced that, or?
Yes
We have. It has been addressed. However, we have been able to discuss that in somehow professional manner. They also understand, you know, you need to have volume to share between potentially dual source. But when that said, I said we haven't really gone on to second source. However, we are checking the market. We are following up. We are not unprepared, I would say. However, again, I've been there before having dual source, and I couldn't share the volumes, and that's also a disaster. So yeah, but it-
It's a balancing act. We had one. I remember one case where they had a little bit of that as a concern, and then you typically need to show that you have an inventory, you can allocate the inventory. So there are ways to kind of, yeah deal with ir in a way.
Yeah
Lars, did you have any question from the-
Yeah, we have three.
Okay.
First one from [Kristoff Review]. Seen from the old group mentioned an upcoming metalens hype, and that the first phone with the metalens is to be released later this year. Is the competition from this type of technology increasing, and what can this technology offer that TLens can't? Guess, Pierre, that's for you.
Yeah. That's an interesting question. We obviously looking into that today. We know some groups which are working on tunable lens based on metalens, and that's, of course, extremely interesting. What we need to keep in mind, and I believe that we very often we forgot about, that those metalens are coming not only with super positive and easy way to integrate, because they are very sensitive to the monochromaticity, so the wavelengths of the light. It's not very applicable for wide range of visible wavelengths. So, I'm still wondering how that will come in the imaging world.
Of course, if you go for a pure green or a pure red or a pure blue type of application, then of course we could take benefits of that. We could implement a metalens on the backside of the TLens, for example, and make a fantastic super compact system with tunability also, for example. So it's for sure something that we look into, and gradually, we are getting closer and closer to our R&D teams around the world to see how we can use potentially those in combination with the TLens for the future application. It's, I think that it, it's like any technology. It will come with a fantastic area of application. But yeah, for cameras, I have a hard time to believe that it will be widely used.
I'll add that from the market perspective, dynamic perspective, my role prior to joining Øyvind and poLight was at Austrian Microsystems, running their 3D and time-of-flight business as a general manager. Dealing with this near-infrared, very narrowband, mission-purposed 3D cameras that are meant to deal with near-infrared use cases like Face ID or world- facing LiDAR. If you look at the fine print, this metalens technology is limited to that application.
It is not meant for wideband, as Pierre was saying, visible cameras and RGB use cases. For those, there is going to be adoption, yes, for sure.
But the longer term, I think there's-
Yeah. Yeah, we, we need to keep an eye, and we are doing it. We are trying to connect with the specialists and to learn and try to understand how we can use this.
Was there more question from the-
Yeah, one from [Hendrik Gau].
Yeah.
Sorry. Automotive is, according to the report from you all, one of the fastest accelerating segments, including up to 18 cameras from the highest level. It looks like AR and mobile are the segments you are focusing on. What are your outlooks regarding the automotive segment?
Yeah, as the automotive segment, we are following. As Tristan said, it is a market which we think sooner or later need AF. And, I don't know. Demand may be five years ahead of us, we don't know, but, we are definitely... And we have POCs ongoing with players, significant players. What we also have seen is that the initiative Pierre has started to build, a broader TLens portfolio, i.e., a bigger TLens, is something we expect the automotive application also will need. So we are, in that sense, we are preparing for also being a player in automotive. We believe that as, who was saying it? It was Tristan or Pierre, that this mechanical moving actuator lens stack in a car environment is completely impossible, we believe....
I think we should, as a, as an actuator, as an AF technology, have a great position. We know what they need, we know what they demand. We also know more or less the timing, and we also have defined a roadmap which is compatible with that. Yeah, yeah, one more?
Pierre said that the earliest patents are valid for eight more years. What will happen when those expire?
Yeah, so that's a good question. There are many brick technologies that we have applied patent for, which are valid for much more time than that. So those are the very first one that will expire, which are really related to the TLens today. And of course, for others, like big aperture and things like that, we are continuing to develop new application and new patents. So there are small features, even in the current TLens, which we have patented also, which will extend, in a way, the protection for those type of products. So that's what we're doing today.
It's a difficult exercise because, of course, everything that we have published will be used against us, because everything which is published cannot be patented. So it's a delicate type of exercise, but we are doing some effort to try to extend even more the current product with new things that we believe are patentable, that we didn't do yet. And a new way to do a product, of course, also. So it will have an end, of course, one day or another. That's. But, yeah, so far we feel that it's still far ahead, and we are really trying to extend it as much as possible.
Sorry, yeah, sorry.
No, the polymer patent is probably good for 15 more years. I forgot the years, but definitely much more.
Is there one more question?
One last one.
One last one. Okay.
What is TLens from Mats Brännström ? What is TLens relevance and poLight opportunities in barcode packaging when it comes to 2D? I don't know if
2D is, 2D is what we do. Most of the barcode readers today, which are based on cameras, are reading 2D barcodes.
The reason why barcode reading went from a laser-based system to an imaging system was because of exactly that.
Yes. Yes.
Okay, is there one more question from the audience ? Yes, there is.
You're using a lot of energy convincing smartphone companies to use TLens.
Yeah.
Have you considered making promotional videos, et cetera, directly targeting the consumers on different social media? This gets a lot of attention, and that we are excited to the smartphone companies showing that TLens investment.
I think we had that, that question also during the quarterly presentation. Maybe it was you who asked it. But I think, I think we did some, we did some in, couple years, one year.
Last year, yeah.
Last year, we did. You may remember that we posted that in various social platforms, but I think we could do more. We could do more. And as I said in a Q&A yesterday, that we need to look into that if we can do more on that. It's not a bad idea, and we have done it, but we have probably not done it enough.
The smartphone companies will want to do what the consumers require.
True, true. So, it will take a big push, though, I think. But, yeah, it's at least, in theory, you are, I think you're correct.
About six months ago, we developed this, we're on our way to do this series of what we call poLight videos, that showcase exactly that, the selfie camera with the... We knew kind of the Apple iPhone 14 series onwards, readopting the selfie camera. And the key reason for that is, one of the key drivers for that is social media, TikToks of the world, YouTube Shorts, really requiring the selfie camera to perform. And Facebook, this experience is just not going to be good enough.
But we have to re-post existing videos.
Yeah.
We showcased that quite nicely, actually.
Yeah, we did have to-
Show us really well.
Super good. I think we have done it now. Thank you to my great team for a lot of efforts. So the next is demos. So those who are here can join us outside. There is a small snack and a drink, non-alcoholic, of course. And we can mingle and talk. And you of course, we would like to ask all these guys and ladies a question you really would like me to answer, which I didn't answer to. But they should, if they follow the program, this question you have to ask Øyvind. So but, try and mingle.
I would say that we have a TLens demo, and we have, starting with you, Tristan, you will introduce the table, and you will show some of the videos, sorry, demos. And then also we have Lars here, who is head of the lab, who will... Dan , come here. So Dan is from our Oxford team. Dan, you need to show your face. Dan is heading the Oxford, the poLight Oxford team, and he is from Sharp. His organization was working for Sharp. We stole them. And he will show the TLens demo. He has been responsible for the development until now. So Dan, get ready.
Yes, yeah.
Lars, if you come here. Lars will give you a tour on the lab, if you want. So just in a way, sign up with Lars, and he will guide you down to the lab. And there you can see where we produce the polymer and where we have all this... Yeah, we can basically do what we do at assembly part, but in much smaller scale. Okay? Then-
Just at this tour.
I will thank everybody participating in this Capital Markets Day. I can promise you, there's a lot of work to prepare it. And I thank you for participating. I thank you for participating through the web. We tried a low-cost web solution. Hopefully, it works. At least we saved NOK 60,000. So good for something. Thank you for a great day.