Good morning, everybody, and welcome to Polite's 1st Quarter Presentation 2021. My name is Eivind Eis Haakson. I'm the CEO in Polite. And together with me today is Alten Ringbeckovic, CFO. When you ask question, which will be in the end Okay.
Agenda of today, as before, key events, introduction to Polite, operational market review, financial review, Otrk and Q and A in the end. Key events for the quarter. So we've received an important follow-up order from Honeywell related to the EX30 Scan Engine. Generally, very good progress in the customer cases, both in the consumer segment but also in the professional markets. Specifically, I would like to highlight that the positive development we have reported lately related to smartphone continues, I will come back to that.
And after Q and sign win related to web camera for Max Hub. Briefly about Plite. We have developed and now producing a very, very unique lens optical lens, which in a way many ways replicate the function of the human eye. This can be used for different products. We started already in 2 0.5, so it's been a long journey, but finally we are starting to see proof of a successful commercialization.
We have a strong IP platform. We have 14 worldwide patent families, which is an increase by 1 during the quarter, 10 pending and 3 registered trademarks. Employees increasing these days to now we are 28, including what we call long term consultants. In addition, we have some more shorter term consultant, which is not counted. Headquarter in beautiful Houghton in Norway, offices in Finland, China, France and representation in Taiwan, Korea and Japan.
Shortly, what are the key attributes of our product, very, very compact, can realize very, very complex system solution. There is a constant field of view, which is a big advantage for many application and very, very low POKE assumption. As mentioned, Polite's product and technology platform is well suited for different application. Definitely smartphone and wearable are key markets as of today. It's a large addressable market, just taking The smartphone market, which is, say, give and take, 1,500,000,000 phones per year, there is 1 front camera, maybe 2.
There are 3 in average back camera, which is making several 1,000,000,000 market per year. Polaita maybe address definitely the front camera and also potentially one of the back camera having different roles, different cameras. So maybe say NOK 3,000,000,000 for a year. This is our obviously estimate. So it's a big, big market to pick.
And the good thing is that camera functionality is really, really emphasized as one of the key features with the phone. In addition to that market and also including variable, We are addressing the barcode, more the industrial barcode side. Barcode reading is and direct marking is being used in manufacturing. It's a huge potential here. You can also see it's evolving from 1 d barcode to 2 d barcode, meaning that you have to go from laser based to imaging system.
You want to read something close, you want to read something back on the far distance, and this means that we need a very robust and quick out of focus solution. This is a market we already are in through EX30 Honeywell and we're working with others. Augmented reality, the next big thing everybody believes and we are already, as I will come back to, involved in that segment. Other opportunities, medical, we talk about machine vision, we can talk about web camera, many, many things are coming into us as an opportunity and we are exploring them step by step. Okay.
So very important is when the customer do repeat orders, that means that the customer is happy, we are happy and the customers of the customer is happy. So having a follow-up order from EX30 is very important for us. This is a scan engine, which you can see on the bottom right, where we are in the camera to the right on that scan engine. And this scan engine, Hornewell, sells all OEMs who would like to build a system like a barcode, like the person holding in the hand as an example. So this is a scan engine business of Honeywell and EX30 is the latest release of this kind of which they sell to other OEMs.
No doubt, EX30 design win and shipping and reference has added a lot of more interest and there are several new POCs and projects in that area and I would say relevant areas. So we will continue to work hard on that market. It's going to sooner or later form a very, very robust kind of basis for the company. One good thing about this market, which I mentioned before, is that the stupid products last for many, many years compared to coming to phone, lasting, I want to say, for 6 to 12 months. Then on the an update on the AR side.
So T lens is considered for next generation glasses by several OEMs, as I stated before. Again, Air market is still at an early stage with low volumes, but it is believed that when form factor price is right, this will be a consumer device. We are having key advantages for this kind of application, power consumption being clearly one of them, speed and compactness and also no gravity sensitivity. These are kind of key attributes of Polite and it's a very, very good fit for AI application. What's also nice about this case is that as opposed to smartphone where we are kind of competing with incumbent technology being there for 10, 15 years, We are now in an early stage of an industry for which we can take a position already at reference We are involved in cases both for professional use cases also in potentially consumer use cases.
There are 2 projects already defined, meaning real product projects and our 3 POCs and some also under planning. Those projects we are involved in have so far, of course, not without challenges. But so far, it shows promising results and even we can see a possibility of the timing end of this year or beginning of next half yes, this is related to the professional use case. Maybe this is the long term, the most important consumer market for polyte and Tillands. And today, that's not the case because it's more professional use case, But long term, definitely, this has a high potential.
Smartphone. Yes, 1st add in project, which we have talked about in several quarterly presentation has now moved from proof of concept to a real project. We have received a design in confirmation. That is not a design win, but it's a design in, meaning they are planning to use Polite and T lens. We start shipping TLENS for phone prototype phase, which also tells a lot.
Testing on component and system levels continues. It will continue still for some time and related improvement activities is happening. We can't not see today any showstopper from the technical tailings perspective, but obviously, other things may stop it, you never know. But the problem is so promising, we feel that ramp up is definitely under planning, already planning material and starting assemblies. So this we have to do to be prepared when the opportunity is materializing.
The current phone release plan is implying that we need to start shipping from latest Q4 this year, and that's why we are very busy and planning as good as we can. We are this is related to a very, very well recognized camera module supplier and definitely a very well recognized OEM and they are heavily engaged. In sum, very good progress, but not a done deal, but we are very, very hopeful and plan according to that. In addition to that case, which we have talked a lot about, this design concept has definitely triggered a lot of interest in the area of front facing cameras. You can see that tunable optics such as TLENS is getting more and more attention from the news.
We have now seen new initiatives Involving other camera module suppliers and other OEMs, And I would say it's a small maybe handful today of other initiatives, which is basically triggered by this design concept, which can realize, as you can see from the right figure, a very, very, very compact solution for selfie camera with autofocus. So it's Basically do not take more space in the screen than a fixed focus camera and that is really, really, really interesting for many OEMs. So you can add out of focus with no penalty in discrete size. And this is why not only we but many have speculating is that this can potentially be this concept can potentially be the mainstream self ecommerce solution. I'm not saying that we will be there alone, but this concept has really, really promising future.
I also want to say mention that this new add in design for us and for TLENZ It's also highly relevant for smartwatches and AR, but today, the main focus is smartphone. Then we received a design win on the webcam. It came for many as a surprise. Of course, we have been working on that for some time. It's called the Max Hub.
You can see The webpage on the right where they present the new camera and the new autofocus solution, You can see the statement from Max Hub in the press release. By adopting TLEN's technology, it ensures a smoother meeting experience by such a promising statement, and we are very proud of being part of this fantastic web camera, which already have received a lot of good feedback. The COVID-nineteen situation has definitely changed the way we work And the way we communicate, web camera is a key element in that aspect, and we do expect this is a fantastic showcase for getting into other potential cases in the Webcamar area. Just want to mention that Longer term, there is companies working on what they call volumetric videoconferencing by basically 3 d videoconferencing based on dual camera and light field imaging. And definitely, we are in some projects, I would say, POCs demonstrating TLEN's unique attributes regarding speed and constant field of view, which are making this actually possible.
That's for future, but we also have to have something for the future. I would say continuing good progress during the quarter, illustrated by this table showing you planning POCs, ongoing POCs, completed POCs, Projects. Project means that then it is a decision that we will use your TLENs in a product. PUC is more a technology assessment. Ongoing supply is obviously where we have already signed contract and we are shipping.
So you can see is that we have ongoing supply. We now have 4 as opposed to 3 in the last quarter. There is now 6 projects and 4 for last quarter. There are 27 completed PVC as opposed to 25. And our 25 ongoing POCs, so still a lot, one less than last quarter and there was 11 no planning POC and that compared to 8% last quarter.
Very good activity, very good pipeline maturing month by month. Altening, would you help me to go through the financial review?
Sure. Thank you, Emil, and good morning to you. Deliveries of TLANs and ASICs for commercial use and services and samples for customer development projects gave NOK1.5 million in revenue in the quarter compared with NOK500000 in the same quarter last year. The EBITDA loss in the quarter was NOK 20,000,000 approximately versus SEK16.1 million the same quarter last year. The increased EBITDA loss is mainly due to Social Security accrued when it comes to the share option plan.
That is an effect of that the share price of Polite share have increased in the period. This is offset by reduced operating expenses of $2,200,000 On the balance sheet. Cash position of $68,400,000 at the end of the quarter compared with 50 $9,000,000 the same quarter last year. As an effect of the accrued Social Security on the share option plan, The current liability have raised from $12,900,000 in the beginning of the quarter compared with $23,000,000 at the end of the quarter. And according to current plan, the cash deposits will fund group activities throughout 2021.
The cash flow. We started the quarter with $77,200,000 in cash deposits. We used SEK11.2 million in operating activities compared with SEK22.2 million in Q1 last year. The reduced cash used is due to a decrease in working capital and of course, the mentioned reduced operating expenses. We also used $200,000 in investing activities, and we received cash from financing activities were of $2,300,000 in exercised share options.
At the end of the quarter, we had $68,400,000 in cash deposits. Okay, thank you.
Thank you, Alfvening. So remaining is outlook and Q and A. As we hopefully have managed to illustrate, the progress is continuing, we feel, smartphone projects progressing, not only 1, but other initiatives triggered by the very novel add in design, barcode follow-up orders, other customer opportunities maturing in several segments, including barcode and design win for web camera application after the quarter. So many, many good things are happening for Polite. Definitely, it's important to say that there's still much to be done.
We still have to pick up a lot of revenue over time, But we are building step by step the fundament, which we believe will be a strong fundament for Polite and future proofing the company. It's also many, many challenges which we need to address in not only the customer related activity, but the fact that there is this is a new company, we are doing things for the first time. We are today, we are living in a market where supply chain is really, really challenging to manage due to shortage of capacity components. So there is not lacking challenges, But I feel that we have an organization which are handling those challenges in a very professional and dedicated way. We do intend to improve progress on important long term initiatives, which is about building a bigger and more global organization, which is about having more competence in certain areas.
So we are step by step building up and we have during this quarter employed 3 new employees, 1 in Finland and 2 in Taiwan and more will come in this quarter. The progress we feel gives definitely a confidence, as I mentioned, that it will be a good story. Polite will be a very good company. Of course, there will be ups and downs, of course, there will be challenges, but what we have seen now is that we are building a fundament which we strongly believe in and which will become a very interesting and profitable company. Alfvening already mentioned, cash position and that will fund us throughout 2021.
I just wanted to show one more slide, which I've been challenged to be more specific on what, when and by many. So we try to illustrate the milestones we have we kind of defined on ourself. These are obviously risk factors related to these milestones. There are uncertainties related to these milestones. But hopefully, this is something which should give you a little bit better insight of our plan and also for us a motivating road map we would like to execute on.
So today, for design wins, several projects and POCs ongoing in different areas. We are targeting, as you can understand, our first design win for smartphone, autofocus, selfie camera towards the end of this year, an extremely important milestone for the company. We have managed to go into wearables, managed to go into industrial application, we have managed to go into accessory application. And now the big volume market today is definitely smartphone, and it's extremely important that we get into that. So that would mean a lot for cost optimization of the product and organization.
So that we target to happen this year, end of this year. We also target to have a design win for AR. It could happen at the end of this year, it could happen first half next year. As you understand, exact dates and months and quarters are incredibly difficult for us to be precise on, so that's you have to look at this as an indication. We also target the 1st sign win in medical in 'twenty two, maybe end of the year.
That's related to a disposable endoscope, very interesting market. Then we are working on some new concepts being optical image stabilization for AR as an example, super important and also for telephoto photo camera, extremely important and we have an extremely nice concept which we are working on. Also big aperture T lens we are working on. As you know, we have a, as you call it, the MoU project, which is addressing that topic, but we also do internal activity. Beam steering is another area, which we together with other partners or working on.
So there will be new products coming out of based on our IP. That will, we feel be a good basis for also be included in the back camera structure. So we have said that together that will be 2024, can it be 2023, can it be based on existing product? Difficult to say, but we have put it as a target in 2024 based on the launch of new functionality. Then we are also feeling that there will be a AR consumer product, which will be different, which will be significantly different in volume.
And we through the design win in the enterprise market AR, we do expect that consumer based AR will happen around that 2025, a little bit before, a little bit after, I don't know. That will be an extremely important milestone for the company to achieve that. So those are and the other kind of milestones, there are repeat orders and other segments that are probably also common new segments that but I would say that this is the most visible things and the most, I would say, important milestone we can envisage as we see today. Having said, definitely uncertainty related to that, but that's what we look at every night before we go to bed. And every morning we eat breakfast.
Financial ambitions as uncertain but nice to have a target. Smartphone revenue will start this year hopefully. Will ramp up throughout the year and into 2023. If we are first design, when the first shipment of the first phone is successful. Listening to the interest around us regarding this, that can be a steep ramp, which in itself will can be very challenging, a nice challenge to have.
EBITDA breakeven at NOK 23, maybe even if we are good, we can even be profitable. We have an ambition of NOK100 1,000,000, say, we could say a different number, but NOK100 1,000,000 is a nice number in 2025 with an EBITDA in around 20% plus. And as I mentioned before, barcode expected to covering a or I would say industrial application expecting to be covering a significant part of the operating cost of the company. Okay. I hope that gave a little bit flavor of what we are achieving and working hard to manage and achieve.
So then I will invite Alf Henning to join me for the Q and A. So as I mentioned, if you ask questions on the web, please leave your contact details. But it's not given that we are able to answer all live, but we'll try to get back to you.
Okay. Are you ready?
I'm ready, Arsh.
Good. Good. The first sorry. The first one. Does TLENs have similar issues with regards to noise induced affecting radio frequencies or auto sensitive components in like for instance mobile or AR?
Okay. A little
bit uncertain similar issues what that's referring to. But what I can say is that TLENZ, compared to say VCM, TLANs do not have any coils, do not have any magnets. So in that respect, and this is also something we are emphasizing a lot that we are not making that kind of noise in the area of the phone, which is a very sensitive area, the antennas, the microphones. And that area, we are actually very silent technology, I would say. And compared to others, I would say significantly less of an issue for TLENs than others.
Can you say something about how many OEMs that have shown interest in and are considering the add in concept?
Yeah. We as I mentioned during the presentation, if you take OEMcamera module vendors, I would say it's a small handful which has added to that interest list recently. How many of your
projects are related to smartphones?
We have projects. Then it's then how we define project is a project where we already have a project doing something for a particular phone in this case. And that is So far, that's one project, which I showed you on the table. There's one project on the consumer. The other one was the webcam, which is moved to shipment.
That is actually one smartphone project, that means but there are more POCs, of course.
Regarding TLENs and add in design, Have you or the OEMs found new advantages or disadvantages in test models compared to using a normal VCM?
Not obviously, not new. There are plus or minus of VCM and Helens. I think when now we see a lot of interest in this our technology, it's obviously because in some, they, at the moment, feel that the sum of attributes we can give the end user is better than VCM for that function. But I think it's very important that we are on our toes because take the other tunable technology, there are VCM and there are many, many VCM players and they will definitely do everything they can to kind of get back also into debt part of the phone. So I think we just need to work very hard to show performance and to show advantages.
One of the advantages which we have, which is not necessarily very easy to achieve with all the technologies is that You take a selfie as an example. Due to our speed, due to our field of view, it's constant. We take a burst of images. We can combine those images very quickly because of constant field of view and you have everything in focus as we have shown you. That is not easy to achieve with if not having a similar technology to TLN's.
So we need to innovate user experiences, user application, which then will put a priority on continuing using Teadens for that application.
What are your personal thoughts about the term mainstream that you have mentioned that the add in has the opportunity to become in the smartphone market?
Yes. What I mean is that and not only me, but what we have been discussing with the ecosystem is that this shows promising result at the moment. We are moving towards a real project. And if we are successful, if we are good, if we deliver a quality, if we can continue innovation, continue improvement, which is important in this dynamic industry, I think we can be a very, very, I would say, preferred solution. It's not given, but there is an opportunity and we intend to grab that And that's why we say mainstream, because today it seems to be a very preferred option at the moment.
As I said, but we cannot relax. We need to continue to push continue to innovate and we need to be able to supply. So still many boxes to be ticked, but we see an opportunity which is extremely motivating and not only us, but also people, customer we're talking to.
Adi, at the moment, do you work with Tier Lens under or on the top of the phone screen?
On the top, I guess you mean through the screen. Today, the normal configuration on selfie camera is that there is a hole in the screen, which is not the display. And that's where the normal implementation today and that's what we are involved in the project we are talking about and the projects we are talking about. We can also fit and under the screen implementation, I think that the most challenge there is probably the quality because if everything is a screen and we're going to shoot have a camera shooting through that screen, optical quality is not trivial to achieve. So in a way, that's not a TLENZ problem, but it's more like a optical quality through the screen problem.
So we are today under the screen sorry, through the screen, but can also be
under the screen design. Is Polite the only player with tunable lenses that fits a selfie camera?
Okay. Today, we don't we are not aware of many other opportunities. But of course, there are other tunable Technologies, there are like the liquid lenses and the various type of liquid lenses, which I'm sure also are being considered. This this ecosystem do not like companies to have a single source situation. So they will definitely strive towards having alternatives definitely and that includes VCN.
But I think that we feel that TLens is probably one of the easiest technology to integrate in such a scheme that we feel, that's a subjective statement, but still that's what how we see the world today. We have a good chance.
Has Android facilitated the use of TL lens and similar lenses, for example, all in focus? Or does OEM or ProLite need to develop a custom camera app?
When it comes to achieving the auto focus function, the Android, we basically our customer is using the standard Android contrast based focusing technology can be done smarter and faster, but that's what used and that works well. When it comes to like all in focus KA or stuff like that, that will be a 3rd party software, which the OEM needs to implement to achieve.
It seems that several OEMs use the term TLANZE technology when using TLANZE. Is this something Polite has decided?
No. Polite's trademark is, as you know, capital T, capital L, E and S, that's how we write it with capital T, a capital L. And there are various ways of even internally, we are cheating sometimes, but that's our trademark and we are not telling anybody to write it differently.
Does your partner, Jorg 2C plan to extend their market for iris scanner with TLENs towards the mobile segment? And would that be possible to implement in an under the screen solution?
Jo2C is a Korean company, which we have been supplying components to, an innovative company doing interesting things. What they plan to do, I should be careful kind of answering to that. I think it's better that you approach J2C with that question. But on a more, I would say, generally speaking, I think that, yes, why shouldn't they? I mean, I don't know what they're doing, but of course, they could do, But please address that to J2C.
How are the opportunities for more products from Honeywell in 2021?
In 2021, I don't this is a very slow moving industry. They took years to finally decide and release the EX30. The way we understand it, Honeywell is supportive and would like to continue to evolve new solution based on also TLENs. I'm sure they're also considering other technologies, but they definitely have stated that they would like to continue the cooperation using TLN for other products, but that's not going to happen in 2021. EX30 going to live for 5 plusminus years.
With the design win in the web camera brand, Max Hub, do you expect to see more design wins in this segment for the future? And why did Max Hub decide to choose TLANS?
Yes. Why? I think I read the statement from the Vice President from Max Hub in my So that's obviously speed, smoothness and no field of view pumping. So that's why. Yeah, I think definitely it was an important design win because of the reference it's represent.
And no people can buy this camera soon, I hope. And we use it together with teams, with teams, it will be used in different kind of settings. And of course, we will use that case for whatever it were to demonstrate the advantage of using T lens. So yes, hopefully, this will be a stepping stone towards more of such application, but there is today nothing in the concrete in the pipeline, which I also mentioned in the last time we talked about it. Okay.
How is the new partnership with Brighter Wave received by potential customers? Is there any interest around this now? And What kind of opportunities help Polite in this partnership?
So Brightaway is a small Finnish innovative team, which we have been working with for a long time and we are having a good corporation. We have sent some patent application, we have some joint presentation and they have a very good laser competence. So I think I can see several application coming out of that corporation, it could be laser tuning in AO world, it could be LIDAR, it could be many things. And I think that But still I would say it is an early stage in this advanced R and D stage and it's too early to talk about customers concrete. So I think it's we need to come back to that.
But it's an interesting technology and in combination can realize many interesting concepts.
Can you tell us more about production capacity at this moment?
At this moment, we are obviously using all our efforts to plan for the ramp up for the coming hopefully smartphone project. Luckily, and I'll say luckily, we have been foresighted and we have built quite some inventory in on the wafer level, and we are also have started to prepare a second source on the assembly side. So that's our main focus, be able to supply to that smartphone case starting shipping end of this year and we have also placed additional POs on Ester Micro to secure that and to secure us into 2022. So what we have said before and stepping back, our supply chain is give and take. No capacity limitation at all.
Then we go to SD to buy the eye muscles, the membrane, which we bent. That is definitely a different ballgame and certainly at the moment, what we said historically is that we have already installed a capacity of around, say, 1,800,000 to 1,000,000 lenses membranes per month. That, of course, is given that you have supplied material into the fab. So we're now starting more on the regular basis to fill that fab so that they are already running. But today, the lead time can be really, really high.
In a normal situation, maybe say 3, 4 months, but today, it's much longer. But luckily, we have planned for material and we are in good shape for the coming projects. Assembly wise, we are now building up a second source. We have 2 sources. We have also said that with one source, we can do, say, between 500,000 and 800,000 per month.
So doubling that is obviously needed to ramp up at the level we are planning. New production partners have been mentioned.
Can you tell us more about this?
It is a production partner in which we've before was using the fab in Taiwan, which is now moving or have moved the manufacturing to the Philippines, same company. So that's it's a requalification there. And then we have also found a worked for a couple of years now with a new manufacturing partner in Taiwan. Then we have one in Philippines and one in Taiwan, and we intend to keep both busy.
Xiaomi Mi mixed fold were released with grid lens from Next lens. The reviews were not impressed by the image quality. We know about all the good properties with Tier Lens. How is the tier lens when comparing image quality with the best VCM cameras?
Okay. Yeah. Regarding the Xiaomi review, I haven't seen that, but it will be interesting, of course, if somebody can send me that link showing that review.
But
on that phone, that is a liquid lens. And in a way by design that is causing some potential issues on image quality, That's physics. And there also some of the liquid technology do not enable our coating. To do. For TLENs, it is already included and then you can add coating on the TLENs to make even better.
So that's on that side. But on the VCM side, it's a long answer. But what I can say that VCM has been optimized for 10, 15, 20 years. It's a good technology, no doubt about it, but it lacks compactness, it lacks speed, it lacks constant field of view, it lacks not being magnetic and what have you. But what they do is as you know, they move lens stack up and down to change focus, slow mechanical movements.
What we do is that we bend a small membrane to change the focus, quick, low power consumption, no magnetic noise, etcetera, etcetera. That bending, That banding will imply that there will be sort of what you call a field coverage effect, which you will see in the corner of the image in a lab if you take an image very, very close to the phone. So that's in a way a disadvantage of any tunable optics by design. So that's you can say is a negative thing compared to VCM, but I would say more positive things as I've been mentioning. So and then I think that back to the field coverage, which you can maybe seen as a negative thing, The field curvature can be compensated using a T lens by taking a burst of images, combine all images and everything will be a focus, so field coverage will go away.
So with our plus, plus and minus and maybe the biggest plus for VCM is the market position they have and the maturity they have. That's probably the biggest advantage of ECM, but we're going to go there. But having said that, BCM will exist for many, many, many years and maybe forever for always. But there will be other technologies coming in and coexisting with BCM.
How does The MOU, sorry, MOU project stand now?
It's progressing, Not super fast. This quarter, this is the project with a camera module supplier where we are testing a concept for a bigger aperture TLN, which I mentioned earlier in the presentation. So it was around NOK700,000 progress, Alfvening, during the quarter. So yes, progressing, but still things to be done. And it is not on the highest priority because of natural reasons, but very interesting concept, which we will walk through.
We see some phones come with 2 selfie cameras. Do you know if there have been built any test phones with more than 1 TN lens in front camera? If so, do you know how that testing went?
No. As far as we know, obviously, we don't know everything. But as far as we know, there's not built or planned dual front camera. You saw dual camera more often before than now, to be honest. But as I mentioned, volumetric video conferencing, having 2 cameras, stereo camera and with T lenses will be a very, very interesting application, which may trigger that trend again.
Let's see. It's not happening tomorrow, but it is showing some interest. The world is 3 d, and I think more and more will become 3 d. And TLENZ is a fantastic application for such compact 3 d solutions due to speed and constant field of view.
We saw that Max Hub referred to TLAN saying TL Lens Focus. Can you confirm or not if OnePlus is talking about the poor light TL Lens when they talk about new TL Lens technology for lightning fast focus in their new models?
What I can say that Max Hub did write TLENs wrongly in the first release. They have updated the web page, so now they write TLENs as we recommended with an hour even in the back. What related to 1 plus, I can only relate you to talking to OnePlus because we cannot comment on OnePlus press releases.
Is there any movement regarding the competitors in the market? Are there any new competitors? Or have some of the existing competitors strengthen their plays in the market? Are Polite still as strong as earlier?
I feel if you refer to the this quarter, I would say that Polite's position has been strengthened significantly. New design wins, repeat orders, progress on the smartphone, design in commitment, shipping to prototype phone. So I can only say that I feel or we feel that our position has strengthened during the quarter. Obviously, you can't only review competition over quarter, but there is competition and there will be competition. But I think we will manage quite well in that competition.
The biggest competition we have today
And what do you think about our share split?
Yeah. We have done that historically, but no, we have no plans for that. The liquidity and the retail But as we see today, there is not an urgent need to do that. So no current plans on that.
Can you make an assumption of a high volume case? How much time does Polite need to provide the OEM finished lenses?
It's very difficult to give one answer because it depends very much what we have ramped up to inventory. So but I would say in a normal situation, in a normal world, which we do not have today, there will be maybe, say, a couple of months of maybe 3 months of lead time, but that's not the case today. That's why we have taken commitment long time ago and material to achieve what we are doing now hopefully with the upcoming smartphone project.
Have you been contemplating additional financing to be able to cope with more projects, etcetera, and aim for building an even larger company and faster.
As we mentioned several times and is that the board and management are constantly continuously evaluating indeed for financing. We are keeping a very, very close eye on the cash we have. Being a solid well financed company is also very important for our customer. So what I can say is that this is something which is constantly consider.
Many opportunities for your TL lens. But as a small company, you obviously have limited resources. Have you declined project leads from partners due to limited capacity? Please elaborate on how you prioritize.
Yes. We have been invited into some relatively long term things which we feel will take our focus too much. So that happens. It doesn't happen often, I have to say, but yes, we have cases there. The priority is simple.
The priority is getting a design win in smartphone. That is the priority. And that we will achieve and work extremely hard to achieve. And then we obviously have defined kind of other areas, industrial like barcode, medical like endoscope, ARVR, So all of those are getting also a fair share of the activity. But I would say smartphone and this advent type concept has took a lot of our resources in the last, I would say, year.
But we are also obviously making sure that our customer and projects in industrial, medical, AR is being treated in a good way and hopefully will lead to assignments in not too long future.
How do you judge Nxlands as a competitor or even someone to cooperate with.
Nextlands has done Nextlands is, I guess, is an organization which is Taking Oplutune technology maybe into smartphone, I'm not fully aware of the strategy there. But Yeah, I think Nextlands or Optitude will coexist. They have been done a very good job in the industrial area and they are cooperating also with partners in the smartphone area. So I think it will be I think those technology will coexist. Sometimes we are better fit and sometimes they are better fit.
Is there a difference in the OEM swiftness On decision making, are some moving faster than others?
Yes, a good question. Yes, typically big organization, more processes, So yes, there is a big difference. Big organization, qualified technology, right report to put the technology into the kind of available technology closet. And then when somebody product management needs something, they go into that closet and look at what kind of technology has R and D qualified and then they use that technology maybe. So whereas in a way, other small companies would find, okay, Teads, yes, that could be very good for our web camera and they start in a way not a generic POC, but there is more start directly on the project and then move faster.
So yes, there is a difference.
Now, when do you have shipped a fair number of TLNs and can you say something about yield quality levels, returns, etcetera.
What I can say is that we will have yield we have clear evidence that we will have yields above 90, high 90s, that's what we see. But yield will always that kind of yield will generate will be achievable when you over time ship volumes. It's not achievable when you turn on and off your fab, it's not possible when you have low volumes.
Can you comment on how, when and on what level additional financing will be made?
No comments to that. Just saying that we continuously are evaluating when to do what.
Road map, Will it be really will it really take until 2025 for design in for glasses?
No, I didn't say that. I said that I expect that consumer driven IR glasses is for later. We are involved in a project with a known of well recognized OEM, which is thinking about consumer as the base case, but that is shipping planned shipping relatively late. The first design win with Eyeglasses will be a professional use case, being doctors, being industrial applications and that will come first. And then the consumer market, when form fit factor for the glasses when cost is coming down, it's become a consumer market.
That is it 25, is it 2024, is it £26, I don't know, but it's later. And that's why we say we are differentiating design win on AR for professional and AR for consumer. Where it is in time, I don't know, but we put it in 25, maybe it's 24 or 26.
And there's a question about interference. Pattons and other OEMs and smartphone vendors show concepts to decrease interference from this switching from Piazza due to fast steering, voltage switching?
Yes. So the driver, the TLANS itself doesn't create noise. But of course, there is a driver of the tailings, which is an ASIC, which has to be designed properly to not making too much noise when it comes to EMI, ESD and that design we have.
Larger tunable lenses may need high voltages and may be more affected by gravitation. Does Prolight have any solution for these problems?
We don't have gravitation effects at all. A liquid technology will definitely have that's one of the disadvantage. And so clearly one of our, I would say, big advantage. And then the question about voltage, what was that?
It was more like it needs more voltage if it's larger.
Yes. We have a driver which can go up to around 50 volts. And that's what we need to get to have the optical power we need. That's a quite high voltage, but we haven't seen any issues with that in implementing that technology. So maybe I misunderstand the question, then please if I did, give me send me a mail and I will try to answer it better.
We are getting close to stopping, Alfvening. Is there any more questions?
There are more questions. I guess there's only one. Okay. So the last one. You state that barcode revenue will cover a substantial part of the total OpEx in 2025.
Yes.
Does that indicate lower price in high volume sales? Or does it indicate a huge upside in revenue when adding high volume markets?
Yes. So barcode is a typical area we typically ship low volumes, but at a different pricing. And that's what we call a kind of a high margin, low volume business, where I say the smartphone market will typically be high volume, lower margin. So that's the combination we try to kind of make in the company is to have some steady long term good projects, products shipping steadily over years, same product at low volumes, but relative good margin. And then we have the consumer on top, which is kind of cream on the cake.
Okay. There was a last one, if that was just a last minute. Earlier, it was said that the smartphone release with TLAS was expected early 2021. What was what has happened since it's delayed with almost 1 year?
That statement, I can't recall, to be honest. At least the last quarters, we have not talked about early 2021, but it can be an old statement. Sorry for that, I can't recall that statement. So please send me a mail and I will try to clarify it there. What we say today what we see today is that there is a very good opportunity to have to be a part of the smartphone release, which will be released in the beginning of 2022, and we need to start shipping in Q4 2021.
Okay, fantastic. I feel this presentation is over. Next event is Annual General Meeting on the 26th May, Q2 August 2021. Between now and then, we hope that we have a significant progress to report. Thank you for participating and particular thank you to all of you who are digging and digging and digging and sending in questions and sending me SMSes and mails, I like it very much.
I feel that it's very motivating to see so many people be so interested in the Polite and the technology. And I think that we owe you a lot for that interest. Thanks a lot. Enjoy the weekend when it comes. See you next time.
Thank you. Thank you.