Hello, and welcome to another Q&A with poLight. After our Q1 2026 presentation, we decided to arrange another Q&A, as we have done several quarters. Joined with me is, of course, the man with the answers, and we have been sent in lots of questions. You can also send in questions during the webcast. I will be asking the questions and Øyvind will answer most of them. Some I might even answer myself. I'll just leave the word for you, Øyvind, for a short introduction.
Yeah. Thank you, Joakim. It's extremely busy, exciting, and demanding days at poLight, for sure, which is good. Strong quarter, both with respect to revenue and market activity. Also some good pieces and I would say also steady good development on the industrial space, and we did also launch a new product, MLens, for that market segment. For TLens, I would say that in very short, very promising outlook for and particular for the AR/MR. Some of the consumer POCs within the AR/MR space is progressing well. They are demanding, there are challenges, but there are potential important milestone which can be reached during 2026. This is, I guess, the overall the main activity in the company is supporting those POCs.
Seems like autofocus capability seems to be on the roadmap for many of the AR/MR players, which is good. For TWedge, which is still in the early development stage, it's amazing to see the interest remain strong between major consumer OEMs. We are also now in discussion, I would say early phase of discussing when to have ready a mass production version. That's I guess in very short summing up the situation. As I said, busy, exciting and extremely demanding.
Good. We'll kick right off with some questions. Some of you have sent questions in Norwegian, which is of course is not a problem. They will be translated, but if you want to make sure that the wording is exactly the way you want it, we encourage you to send in questions in English. We've asked Investorweb to also make that clear in the future. First question, you have a project with consumer AR glasses that has progressed quite far now. It was mentioned at your quarterly presentation that it can actually be defined as a design in if one follows poLight's way of defining projects, but you want to hold off a bit to be completely sure that it will go forward.
Could it be that this project could go directly to a stock exchange launch, meaning a press release, if the customer is ready for it without it being defined as a design in first?
What the question is whether we could go from PoC to directly to design win and not via design in.
Yes, I guess that kind of project.
Yeah. Excuse me. Yes, that's possible. We just need to see how things develops. The normal process would be that we announce the design in, either through a quarterly or separate. It has happened before that we go directly from POC to design win.
Good. Given the maturity you describe in general, do you still view 2027 as a realistic year for commercial launches from the most advanced AR/MR programs?
The current time schedule for some of the customers, for some of the leases could indicate that that could be the case. Also, we should not be extremely shocked if those dates are changed, because that happens all the time, that there are delays in the project, not necessarily due to poLight, but due to customer kind of prioritization and strategy. Currently, the plan we have seen or been informed, that is possible.
Good. You have a project with another top tier regarding the development of camera modules with TLens for them. Can you say something more about how the progress is going here?
I'm not 100% sure which one you're referring to, but I think I know. That program is going relatively well. The first camera module will hopefully be assembled and tested within this quarter. Meaning Q2, end of Q2. That's gonna be very exciting to see. Customer will then also receive samples at that, yeah, during this quarter.
Let's see. Onto some questions about TWedge. TWedge is an exciting component. We can all agree with that. It is stated in the quarterly presentation that there is enormous interest in TWedge, and that all the customers you have worked with are still involved in projects. Customers are likely working with different display solutions, some with LCOS, some with MicroLED or other solutions. Can TWedge be used for all such display technologies?
LCOS, MicroLED, even laser-based, the way we see it today, there are potential for TWedge use cases in all the display solutions being considered, which is good.
Very good. If a partner comes in place on July 1st, 2026 on TWedge, is it possible to think that this will come to that they will drive this, drive it to the market within 2027 if you are very, very optimistic?
I think that's difficult. There is some customer who have been requesting or not requesting, talking about availability of TWedge mass production version end of 2027. If that only starts in like July, I think it's close to impossible. It will be more like the first half 2028, I would assume.
Could you say anything about the estimated cost of bringing TWedge into mass production, and how much do you realistically think that customers you are in dialogue with could contribute financially?
Good question. We of course have some numbers on that. There are relatively several million NOK, of course. I don't want to be too specific on that. How much can we get from customer for financing? Well, that's also difficult to answer, to be very precise on. We would target to get a significant part of the development cost covered. As I mentioned during my quarterly report, when you take that kind of money from customers, there are also some strings attached, rights, protection, exclusivity. We need to balance that the company is having the sufficient freedom to operate and not being too kind of restricted by a party, contributing financially. It's also a scenario that we decide to move without any financing and sell samples.
That's to be seen, depending on which terms we can agree with the customers.
Mm-hmm. It has been stated that TWedge can address various pain points. Can a single TWedge unit solve all these identified issues simultaneously, or would a specific device/solution require multiple TWedge units to address different technical challenges? I guess assuming there are more challenges in one device.
Yeah, that's a good observation. There are functions which is requested by some customer, which is, I would say stressing the specification quite tough. Whereas other kind of functions are more the mainstream, which was the beginning of the program. There is a scenario that you could kind of have a TWedge which can cover 80% of the functions, but the other kind of functionalities maybe has to come later after more mature technology as a revision, or it needs to be a separate kind of device. Most likely we will try to have all in one, but we may not have all function enabled in the first revision. We need to see.
Speaking of revisions, again on TWedge, have all partners currently involved in TWedge programs transitioned to the latest TS5 version? Furthermore, could you see, could you share how many customers, partners have acquired the TS5 to date?
We're trying, I don't want to be too specific, but we are trying to convert. There are some which is currently on TS4 and are doing TS4 programs and testing that. We are trying to merge, convert every customer now to TS5. There are still some TS4 out there being tested. We will not supply more TS4 likely, so new supply will be TS5. We also considering not to kind of have the same level of sampling as we've had before, because that is also something which is kind of, interfering quite a bit with the development program, where we produce samples. Trying to find a better balance between sampling and development. We are moving into that phase also soon likely.
Good. You also say that there are concrete discussions with at least one of the key players about TWedge and the next phase towards building production.
With such a high level of interest at the moment, how can you ensure that you meet any potential capacity needs, and what will you do if there are multiple OEMs, CMMs, or display players, wanting capacity or to run similar projects?
Capacity in different aspects, capacity to handle different customer in a development phase is one aspect. Another aspect is capacity of building capacity in production. For the first, which is most relevant now, are we capable of handling more customer in the same program? If there are different programs for different scope, I would say difficult. If we can line on in different customer within the same spec, more or less, then it's of course much easier. When it comes to manufacturing capacity, it's too early to say, and that's also we have a lot of time to build that capacity. The most likely the equipment needed for manufacturing is very similar to what we have for TLens, where we have massive experience.
The most long lead item and the capacity constraint will be as in TLens, the test, final test capacity. We have a lot of time to build that, if and when needed.
There's a question about the dialogue with OEM regarding TWedge financing co-development deal. Well, this is almost the same question as earlier. Do you expect the negotiations to be finalized by 30th of June? We were talking about the first of July earlier.
It's impossible to say. I think that we that could be a target, but it's impossible to say. It's for us, it's more important to conclude in a good way than in a fast way.
Final question about TWedge at least so far, and it's actually several questions. Does the enhanced focus on TWedge in recent quarters represent a strategic shift driven by the fact that the camera module market for TLens is more competitive than the display market is for TWedge? Does poLight view TWedge as a universal key component with potential for a wide range of AR glasses, while TLens is more specifically positioned as a niche solution?
I lost the second question. Let me start answering to the first, Joakim. No, TLens, TWedge, I think that the like when it comes to TWedge activity, there's very much kind of a push from the market that they want us to kind of develop that kind of functionality and component from. Of course, that's a very promising situation. Market wants to see this to be developed. From our side, we are focusing even more on the TLens programs and the POCs, as that's the product we already have developed. It's a program product which is already in mass production. The priority from our side is clearly TLens programs, projects. Of course, TWedge, we are kind of maturing step by step.
For internal priorities, crystal clear, TLens first and TWedge second. The second question, Joakim, was?
The second question is, does poLight view TWedge as a universal key component, with potential for a wide range of AR glasses, while TLens is more specifically positioned as a niche solution?
I would say opposite, actually. I would say TWedge is and that's why we would like the market to participate in the development because we see the TWedge application as a very niche application as of today. AR is maturing, yes. Display solution is one of the main challenges for AR glasses, and that's maybe the less mature part of AR glasses is exactly the display. There are many display solution being considered, laser, LCOS, MicroLED, et cetera. And who knows who are gonna win that battle, and maybe they will coexist. That's why TWedge is AR, MR display solution. Many different solutions are in the development. The uncertainty is high when it comes to system solution still.
That's why we cannot move alone on TWedge. We need a customer to back us. Whereas TLens have many applications, very mature application, many customers in many market segments. It's actually the opposite. It's the other way around, I would say.
Good. We've, we have two questions here that are more or less the same. We're moving on to more production and supply chain now. One is, do you expect the Q-Tech line to be fully operational and shipping customer qualified units within 2026? The other is, you said Q-Tech is prepared for mass production. What is the realistic timeline for Q-Tech to start producing TLens for the leading top-tier AR customer? They're quite related.
Yeah, very related. Yeah, definitely we do hope it could be qualified this year. There are some improvement processes ongoing where we are supporting, of course. They have produced units already. Those units are being tested and qualified and go through reliability test at our site. Camera modules is being built with TLens inside from both plants. This is ongoing at full speed, but not yet qualified, but I will expect it to be qualified definitely during this year.
Some relating to capacity. I'll ask this one first. You said the capacity is becoming a bottleneck. Does this reflect internal expectations of significant volume ramp from one or more of the leading POCs?
Okay. Capacity, yeah, maybe you're referring to capacity, internal kind of capacity in the team. That's definitely a challenge. We are looking after many customers. We are maturing many demanding POCs and demanding customers. We are definitely. It's very often those very highly skilled tech people who is involved and need to support, which is kind of the limiting factor. That is a challenge, and that's why we are currently recruiting quite a bit of people. Of course, before we can get an impact from those people, they have to be trained and so it will be potentially worse before it becomes better in a way.
That capacity when it comes to people and skills while we're engaging with the big name's big companies, while those also are getting closer and closer to real programs, then the heat is on, definitely. We feel that it's day and night, it's weekends, a lot of traveling, a lot of support in all kinds of time zones. This is quite painful, and that's why I'm saying in my summary slide, it's busy, exciting and extremely demanding days, and that is related to capacity in the organization to support the customer the way they expect you to be support and the way we want to support. This is just some pain we have to go through.
It's a part of growing up as a company. It's a part of qualifying for Champions League. That's where we are, to be honest, Champions League.
Mm-hmm. There's a couple of questions here on testing capacity that's slightly different. Do you foresee testing capacity becoming a potential bottleneck for future high volume deliveries? Then we have a question about.
Yeah, I think.
Capacity afterwards. You can talk about future first.
Definitely that is a quite important area. Testing is super critical to secure quality on everything which we send to customers. Currently we're testing all TLenses. They are not only tested, but they're tested in a very, I would say, special designed device by us and manufactured by partner. It's not something you can easily buy. It's purpose-made device, very advanced. That can quickly be a bottleneck. We need to plan carefully. We need to, together with our customer, kind of try to build a forecast. Based on that forecast, we need to put POs for new test machines to our partners.
That's something which is critical that we have the full visibility of, and that we take the needed investments as we go. We have currently already acquired a new one, so to build, to increase the capacity and also the flexibility because the different products, specification of TLenses and potentially TWedge will have some kind of, you need to kind of reconfigure the test machine, and then you have downtime, and you want to minimize that. If you could have several test machine operating in parallel, it will be increased efficiency. This is a critical area, and we need to carefully make sure that we have sufficient capacity on that field.
Those are the long lead obviously equipment on related to manufacturing, where the other equipment in, we use the manufacturing are more standard machines, which can relatively easily be allocated to the TLens line.
Good. You as you elaborated a bit there, this is more quantitative question. Testing capacity is a frequent topic of discussion among shareholders. Could you elaborate on the current testing capacity for both production lines, both Philippines and Q-Tech, and outline your plans for ramping up this capacity when necessary?
There is one test machine on each site. That test machine, depending on product specification, depending on operating modus. It's typically, say, 400K, 500K a month capacity for that machine, if I don't remember wrong. That is actually in one of the slides in Q4. I think we or Q3, we gave an overview of test capacity, which I think is around that number I mentioned.
Yep.
As I said, yes, we need to carefully judge the forecast when needed. We have two in operation. We have one new on its way in. We need to continuously evaluate when we need to buy. These are expensive things, and yeah, we need to know, say, six to nine months ahead because it takes time to build and get operational. Okay.
Good. I also think you remember correctly. In case there is a discrepancy between what is said and what is written, what is written is right.
Yes.
There's not a correction of that. We'll be clear on that if that happens. Moving on to more industrial markets and MLens. Are there any barcode cases currently in design in that have higher volume potential than the ones you currently have design wins with?
First of all, MLens is mainly in on the machine vision side.
This is in-
We see associated.
This is industrial in general, so this is not related to MLens.
Okay. Okay. Yeah. Yeah. There are some I would say the major POCs or planning POCs on industrial are typically the same type of volume we have seen for the existing customers. We are trying to find higher volume cases. Typically, that means we have to move towards more like point of sales. We do have some cases under discussion on that. It's possible, but so far most cases are relatively low volume, like 10K, 20K, 30K per year devices.
As a question about MLens. It represents a move up on, in the value chain, as a solution provider. Is poLight considering developing similar modules or plug-and-play solutions featuring TLens for the AR/smart glasses market, enabling smaller OEMs to integrate a complete autofocus solution more easily?
Yes. I think also fair to say that we are in some of the programs we have on AR/MR. We are actually involved in those type of activities.
Good. We have a category called financial and cost.
To a certain degree, maybe you can relax a bit here Øyvind. First is a quite long question. I have been following poLight closely, and I'm impressed by the high level of activity and recent developments. It is clear that the team is working hard to drive the company forward. Given the increasing workload and the importance of maintaining high-quality transparency with shareholders, I was wondering if the company is planning to hire a dedicated investor relations lead in the near future. In my view, a dedicated IR resource would not only ensure consistent communication with the market but would also allow the executive team to focus more of their capacity on core operations.
You can fill me in, Joakim, as you know that we did relatively recently, or it's more than one year now, Joakim, is it? We employed Joakim as CFO, one of the reasons for doing that, because we did have a good CFO, Alf Henning Bekkevik. He's still in the company, we have kind of doubled the capacity in that area.
One of the reasons why we did that was that we wanted to have kind of more than me in that interface of IR. It's not that Alf Henning didn't do that, but Joakim, given that we have somebody taking care of all the number crunching and consolidation and cash analysis, Joakim have more time to also devote to investor relationship. One thing is, you see me a lot on those kinds of meetings , definitely Joakim does a lot of the planning and administration around that so that it is a lot for me. Also step by step, Joakim will be more and more capable of having meetings and investor meetings without me, which is already happening.
I think that was one of the main reasons why Joakim joined us, in addition to professionalize the finance department in general and also more active, proactive activity related to financing of the company. Currently, we are relatively happy with that setup. There are many roles I would like to have in the company. I would say that on top of that list is not a dedicated IR person. There are many other roles I would feel is more important than that. Not having full respect for that we as a company need to communicate in a good way, keep our shareholders informed in a good way. We try to do that as good as we can.
As said, the feedback we have from shareholders, I guess, is relatively good in that respect. As I said, yes, maybe one day, I think that there will be many other roles which will be on higher priority than that role. I don't know if you would add to that, Joakim.
I can just say that in terms of cost development, we are, of course, concerned with not increasing too much cost and then prioritizing quite hard on the recruitment we make. It's quite clear that we are a company that now and for some years ahead of us, will have people in management with several hats on. I think we are all quite motivated for that as well.
A question. This also has several questions in it, but it's a bit related to strategy. In light of poLight's current negative EBITDA and the capital-intensive investment in two parallel technology platforms, meaning TLens and TWedge, what is the strategic rationale for not prioritizing TLens solely to achieve positive cash flow first? Why has the company not chosen a model where it uses profits from TLens to self-finance the development of TWedge leading up to the commercial window after 2027, 2028?
I think as I mentioned, I think we do definitely have highest priority on TLens, as I mentioned, related to another question earlier. Yes, we are all spending time on TWedge. The AR/MR market is happening. There is a clear ask from key players that we would like TWedge. It's not that in two years from now, there may be also other solutions who can compete, but it will be completely strange of us if we do not take that opportunity to also establish in parallel a second product line based on the same technology platform when the customer is asking for it.
Of course, we need to balance, we need to focus, but as I said, TLens have the number one, two, and three priority, and we try to maneuver the TWedge together with the customer into market over some time. If we don't do that, we can quickly end up in a situation where there are coming out advanced AR/MR glasses without TWedge, and they are finding a different way of kind of solving the difficulties they have as they see it today, and meaning that there will be a door closed to additional revenue for poLight, which I think will be not a small thing to do for shareholder value. As I said, it is difficult because we need to kind of balancing different activities.
It's not easy, I think it's important I think we address it in the right way with the right balance.
Good. poLight reported record revenue in Q4 2025, NOK 8.6 million, and in Q1 2026 with NOK 11.4 million. A significant part of this growth was driven NRE revenues, specifically NOK 4.2 million in Q1 2026 alone. Can you provide a specific overview of actual sales volumes for TLens and TWedge in these quarters? What proportion of the recent revenue development represents recurring product sales versus 1x revenues related to production setup and qualification support?
You may want to ask that.
If we take Q4, 2025 and talking about NRE, there was about 10% of the Q4 revenue was NRE. That in Q1 it was quite a lot higher. That's correct. The NRE in Q1 is related to both supporting Q-Tech in setting up the production line and also the customer development project. If we look at actual sales volumes, there was in Q4 quite a lot of TWedge sales. Also you have to remember these are technical samples, so they're priced quite high, which has quite an effect on the top line.
I think when it comes to product sales, or unit sales, given that TWedge is not a product but a sample, that's a bit more than 50% is TWedge of unit sales alone. Of course, that's all driven by the fact that that's priced much higher than the actual product sales of TLens. When it comes to recurring revenue or recurring product sales, I think we should be careful. That can be a bit of a misleading statement. We have some projects lead to recurring orders, others, and but the degree of when that they are recurring, that will differ a lot. Some have quite a few orders during the year.
Some can take longer between each order. It's, we've all been used to seeing a lot of sort of software sales and SaaS-based models. This is very different from that. This is product sales. Each product is sort of a project with a lifetime. That's sort of a different different model. You can say that if you're in a product with a lifetime, then the next product that comes after that, we are more likely to get into that product as well. There is a recurrence there. There's more of a potential for recurrence. I think I should be careful talking too much about recurring revenue because it's not that kind of model. We're selling products.
Do you want to add anything to this, Øyvind, or were you happy with my answer?
No, I think it's fine, Joakim.
Let me see. There was actually almost the same question again. As Q-Tech's line gets qualified, does the NRE revenue from that specific relationship essentially go to zero?
Yeah, I think, that’s fair to say, yes, that this is a program which will end and, when they’re ready and can kind of run alone. I think that’s a fair statement. Mm-hmm.
Yeah. It's a production partner, basically, when it's up and going.
There's a few questions about gross margins.
We'll also look into what we can answer here. What is the specific gross margin for TLens units sold to specific AR and MR glasses that have already secured design wins and are now generating recurring orders? That's one question.
Sorry, Joakim, what did you say?
That's one question then.
Yeah, okay. Mm-hmm.
Yeah. There's a follow-on to that that says something. We can maybe answer them together.
Okay.
How does the margin on the actual product sales compare to the company's long-term goal of not being too far from around 40% gross margin? I think those two can be answered together, probably.
Maybe. I think over time, we will be gradually working, be more, how should I say, transparent or more accurate on those type of reporting. Also, likely we will potentially report margin per segment or per product line. Today we don't do that. You refer to, I would say that we are trying to. It varies a lot, you know. When we sell for some markets, we have a very high gross margin because of the low volume, whereas typically consumer-type products, we are trying to achieve a margin close to, say, 40%. Sometimes we are, and sometimes we will not. Sometimes we are more strategic in the pricing than other times.
But so far, those cases which we have been exposed to are exposed to a relatively decent price level, also taking into consideration what we think will happen with the cost structure when we do increase the volumes. I don't think it's unreasonable to achieve the target you mentioned over time.
There's one further question about this, and it's maybe just good to ask it, and then I think I know what the answer is. What is the gross margin on the last order that was described as having a price kind of compatible with a mass production price? Referring to our order in April, NOK 2.4 million.
I can't be specific on that, but it's relatively decent.
Of course, what we can also say is that when we have large quantities going through production, we will also have a far more predictable cost that we can improve over time. This is something we are now working on as projects more than just constant improvement.
Yeah, exactly that. When I say decent, what I mean with that is that if we can maintain that pricing throughout the project or that particular program, I think we will be relatively happy with the margin. Of course, there are fluctuations from month to month, to batch to batch, for the exact reason why Joakim mentioned.
Here comes a question that we see recurring. With a quarterly cash burn of roughly NOK 22 million and rising OPEX commitments, the company has approximately 11 - 12 quarters of runway. How should investors think about the balance between investing aggressively now versus preserving cash? At what point would management consider a capital raise versus waiting for a commercial milestone? That has a lot of elements to it, of course.
Yeah, it has. You have answered two similar questions before. I think the first one, we really now are focusing on building an organization and supporting customers so that we kind of take that position in the AR/MR space which we deserve. That will take investment from equipment, from organization, and that we will do. Of course, we're not spending money we not need to spend. We are relatively strict in our cost and planning, and we do take good care of the cash. We need to invest. We're definitely in an investment phase. As Joakim mentioned many times, there are different scenarios when it comes to cash need for equity. There are scenarios where we don't need, and there are scenarios where we need. That also depends on what else we typically can engage with.
I don't think we will be more precise than that, Joakim.
No, there's no single truth here. Every person involved in investing in a growth company needs to take their own perspective on the probability of one or the other. I think many of those things are what drives some people to sell and then buy more later, or some people to invest more now. That's entirely up to each person's risk profile and appetite.
I think we have maneuvered ourselves into a fantastic position. We are well-funded. We have a lot of programs. We have a lot of maturing POCs. We have the financial possibility and capability of doing this investment. I feel that this is actually something which we have planned and we have maneuvered into this position in a good way, I feel.
Absolutely. Okay, moving on a bit to technology-related questions. You have previously indicated that the development of a new ASIC driver for both lead-free TLens and TWedge will require extensive investments and incur significant external costs in 2026. Can you provide an update on the status of partner selection and the timeline for this program actually related to ASIC driver? What proportion of the expected investments will be incurred in 2026? When do you anticipate that the first functional prototypes will be ready for integration into customer projects?
We have done, I will say, an initial selection of partner. We have kicked off the feasibility study a couple of weeks ago after a very thorough RFQ process. That started. Out of that feasibility study will be more accurate numbers, performance numbers, financial numbers. It's premature to comment on that. We will have a program which will, there will be quite some spending in 2026, given that we continue after feasibility study, which we will know in, say, a month or something from now. Then also the full 2027 will be a year of development. How early in 2028 we can see it ready, that's hopefully relatively early. That's also to be seen after we have finalized the feasibility study. It's better to maybe re-ask that question when we meet for Q2.
Good. One more about, was more related to the lead-free regarding development of the lead-free TLens version. Are there currently any specific partners or market segments showing strong interest in initiating POC programs for this version?
Yeah, there is a few players out there which is very keen to already move all in on lead-free. We also do this for other reasons. Our wafer partner over many years is having a strategic move in that direction. That's why also we follow. We also follow that because of rules and regulation. Not nothing very short-term happening, but it is an expectation that the European Union would like people or companies to move away from any use of lead. We just try to do that as quick as possible to be future-proof ourselves. Also there are some interesting technical characteristics with this new material which will make an improved TLens and ease of use. Many reasons.
Yeah, of course this entire trend and the reason why this regulation is more of an ESG subject. I think the amount of lead that we use is so little that we can't really boast ourselves as making an ESG commitment on this.
No, it's.
We're supporting those who want to.
Yes. Of course.
There's a section on market and competition. There's quite a few questions here, many related to POCs. Some may be the same, so I'll just go through them. Do you see one or more design wins happening in 2026? Easy question.
I hope so. I hope so.
It was the same question again, actually. In AR/MR consumer, we hope so even more, don't we?
Yes, we do.
How does poLight internally define design in today? Is it when TLens is selected as the preferred technology or only when the full customer product design in is frozen?
It is when a customer have kicked off a product development project where the component selection has been done. If then TLens is a part of that component selection, that is the definition of design in. Then you are design in, you plan to be used. That's the definition. It's not an exact science because when you have a design in, you can also end up design out because of different reason, because of cost, because of complexity. That's why when we classify from, when we reclassify from PoC to design in, there are some, we apply some flexibility. We cannot only use that kind of rule I mentioned and not doing judgment on top of it in a way. It's not exact science, but the definition is what I said.
Another question about, I guess, definitions in a way. You have previously said that some mature POCs could arguably qualify as design ins, but that poLight applies caution before moving them in the project table. Is the current classification mainly driven by technical risk, consumer confirmation, commercial uncertainty, or is it NDA related limitations?
Definitely not NDA. I mean, we cannot have agreement with customer, which is kind of restricting us for announce to the market, which we should announce in a way by recent regulation. Definitely not NDA, but yes, it could be all the others you mentioned.
Combination of them Øyvind.
Yeah, [Øyvind].
Looking at your entire POC pipeline, how many programs do you believe could realistically reach mass production readiness by 2027?
That was a big question. Yeah, that was a big question. I don't dare to answer that on the top of my head there. I would say a little bit more, I think it's quite a good number. If you take not only 2027, if you take two years perspective, I think quite a few.
Mm-hmm. Mm-hmm.
Good question, by the way.
Yeah. You mentioned receiving POs at mass production compatible pricing. Does this imply the customer is preparing for meaningful volume within the next product cycle?
Yeah. It means that the customer is planning ramping. Due to our lead time, which is relatively long, they are kind of forced to place it relatively early compared to other components. That's the dynamic in a way.
Okay. Here's a question I think I know the answer to. For the POCs that are closest to productization.
Can you give an order of magnitude indication of expected annual volumes? 10s of thousands? Is it 100s of thousands or is it millions?
Yeah. That is a question, of course, we also ask the customer and even that is difficult to get a reply to. Let me answer like this. I definitely hope it's more than 10s of thousands, more than that. To be more specific, I would like to wait until we see reality. The customer also tend to be a little bit optimistic when they give us forecast because they would like to have better prices. We need to take that with a grain of salt. Yeah. Anyway, I think it's definitely more than, hopefully more than a few 10,000 . Yeah, definitely. Yeah.
This is variation of the same. Have any of the customers in the most advanced POCs communicated an internal target launch window that you can comment on at a high level?
No. I would like to just stay with that. We hope to see meaningful milestones being passed during this year. I think I need to. That's what I can say. As I said, and I said many times, there are things which can happen. There can be delays, there can be cancellations. It's something, keep that in mind. You know, it's when I say that, it's because of that's what we've been told, but we also seen before that things can change. When I say that we're very busy, that we have a lot to do, it's of course because we are in that for so many cases, we are getting in that kind of critical stage.
We have some other, more, about competition. Given the intense competition in the camera module market where technologies like VCM, SMA, and metalenses are all fighting to deliver compactness, energy efficiency and resistance to gravity effects. What constitutes poLight's lasting competitive advantage for TLens? More specifically, how do you defend your position against technologies that also promise to eliminate the camera bumps and simplify the optical designs?
I think one of the when it comes to AR/MR as an example, which is a good example, I think the compactness, the power consumption, and of course the speed, constant field of view. I think compactness and power consumption are extremely important parameters. If you think about all-day-wear glasses are very limited power budget. Even with a TLens, which more or less is doesn't use power, it's ASIC driver basically, which is using some power. It's even for us, we are kind of fighting to please the customer to minimize even based on TLens and our ASIC driver to minimize the power consumption.
There is, as far as I can remember, there are no technology close to that low power consumption as TLens. I think that's power consumption, compactness, speed is crucial in the AR/MR space. I think that's why we feel and can sense that the popularity of TLens and TWedge for that matter is for those reasons. I don't see it's not easy to fight against TLens in that respect.
Which is good.
Good. Does poLight acknowledge that the technical necessity of TLens is greater in MR glasses that are based on video see-through, where a constant field of view is critical than in simpler AI glasses?
No, not really. I definitely VGC 3 is a very interesting application for TLens. We have examples already. We have two design wins in the VGC 3 application, and we are working with others. You know, AI, quality of camera, quality of images, sensing important input to AI engines for decision-making, optical specification for camera system in AI glasses is developing in direction where there's not it's really needed to have AF to have the quality they need of the picture. Combine that with the AI trend. I think, as I said in the beginning, what we see, there are many who starts with fixed focus, but also many of them have definitely a clear roadmap to using AF.
I would see the need for AF in the AI or AR glasses is definitely, if not more needed than in the VGC 3.
See, given that optical image stabilization, OIS, is a critical requirement for AR and MR glasses to ensure stable image capture during natural movement, what's the status of the development of an integrated TLens and OIS solution? How does poLight plan to compete against Oh, you can answer that.
Yeah.
I think the second part of that question is probably in your answer.
Okay. You can say that we have some concepts. We haven't actively pursued those on for TLens or adding functionality to TLens. Of course, what we are doing with TWedge, you know, TWedge is beam steering. You can say that kind of conceptually is also kind of can say realizing some kind of an OIS implemented in the right way. Given that you have sufficient angle of the wedge can also be kind of a step towards an OIS function. But having said that, we haven't really heard a big need for OIS on the AI glasses.
That may come. Then as I said, there is activity internally and also specifically to TWedge, which kind of develop those functions potentially. The speed of focusing in TLens is somehow also making that not stabilization but making the need maybe a little bit less than you would say normally.
Good. We have some questions here. They're very related to named OEMs, talking about their launches coming up. I'm just also in the interest of time, maybe there's no point in me reading those questions because the answer is the same. We can't comment on.
Mm-hmm. Agree.
What is in which glasses.
Yeah.
I agree.
I'll skip those questions.
You know, just a general comment to that. I know that is quite interesting and fun to speculate on who and what. It's not that we don't want to tell you, it's that we are under extremely strict NDAs and if I kind of are somehow tricked one day to say a name, then that's not good, you know, because I will be really, there will be some mad customers calling me. It's not that we don't want to, we can't not do it normally.
Yes. We see that as preserving shareholder value.
Yes. Yes.
Um, so those-
those will not even mention the questions. I see that metalenses could also be used in the AR glasses. Do you think TLens will meet strong competition from that solution? That comes up from time to time.
I don't know really. I don't know really. Maybe I'm not fully aware of all the details in that development, but my understanding at least six months ago is that that will not be something ready for visual in the visible spectrum. We should continue to monitor because I said many, many times we will not be alone. I'm sure there will be other solutions, both on more the conventional and new technology. At the moment, we don't see it related to metalenses.
Do you see any big chance of Qualcomm and poLight being closer partners for working together in both TLens and TWedge?
Yeah. Qualcomm is an important player on the platform side. Yeah, that could happen.
If someone launches AR glasses in 2026, what are the alternative ways of solving the seasickness, resolution and low battery consumption? I feel this is a gift for you to answer.
No, I think there was a mix there because, if I understand the question correctly, it's more related to video see-through.
Can you read the question once more, Joakim?
If someone launches AR glasses in 2026.
Oh, AR glasses.
What are the alternative ways of solving seasickness.
Yeah. Okay. The seasickness issue is more like related to, more like an MR headset, not AR if I understand the question right. I think we need to get that question clarified, and then maybe answer it, through the Investorweb portal, Joakim.
Yes. Yeah. Let me see. Translated. Can you say something more about how the progression with the top-tier backing Q-Tech is going?
It's going well. Absolutely. Very, very thorough. So far so good.
This is a question that sort of looks a bit like a previous one, but as a relatively small organization that has recently acknowledged being stretched in both capability and capacity.
What is the strategic rationale for continuing to invest in such a wide range of verticals, including industry, computer vision, medicine, smartphones, laptops?
Automotive? Why do you not choose to dedicate 100% of resources to the AR/MR sector?
Which you have identified as the key driver for a commercial breakthrough in the short term?
Extremely well-formulated question. I totally agree that that can look a little bit strange. I would say that 95 + % of our capacity is related to AR/MR. We are doing maintaining some activity on the industrial side. We have used that opportunity to also go up in the value chain to kind of get used to that by solving more like a solution. Which is a direction we would like to take in all market segments, to be honest. I think that we are yes, laptop, yes, medical, yes, automotive, but we are really not spending a lot of time. We are keeping an eye on it to future-proof our existence, so to speak, to other market segments.
I'd say for all practical purposes, the focus is AR/MR.
If I look at myself, I'm spending majority time on that. Then there are some industrial, but that is really not. That's also something which I feel is the customer are a repeat customer. They are capable themselves. They are using add-on, less demanding. I think what I'm trying to say is that is more or less what we do. Is more or less what we do today.
Then we have a strategy that we would like to have high volume business through consumer, and we would like to kind of use that to cost-optimize solution, and then also pick some good margin from the industrial, which kind of can be a market which is kind of development sense, a little bit standalone. That's a nice combination. Certainly, an organization is AR/MR, which is definitely on top. That, in a way, is happening by itself, because if you look at the PoC, planning PoC activity, those are dominated by AR/MR. It's basically forced by customer where we put priority.
We're past the time, Øyvind, but we can.
We can keep going for a bit longer.
Yeah. We can maybe go for five minutes more, and then maybe just put those not being answered into the portal.
Yeah. I think I'll look for the questions that we can answer in the portal, and then try to do some of these more live.
Mm-hmm. Yeah.
Questions regarding patents and IP protection keep getting raised. What are you doing to protect the earliest patents nearing their end? How are you protecting these from being public domain?
The strategy we have is to introduce new patents, which is kind of in the surrounding of existing older patents, that in effect, you extend the lifetime of the protection by having other surrounding patents which are related, which is enhancing the solution. That is in a way, trying to, an efficient way to extend the protection time.
That's the strategy.
We've received some questions in during the talk, so we're back to a few previous subjects like the MLens. The MLens was launched in January, and you described positive market response. However, industrial barcode order intake in Q1 was approximately half of Q4 2025. Is there a risk that MLens will cannibalize the NRE consulting work you previously earned helping customers integrate TLens? If so, is the margin trade-off net positive at scale? What volume assumptions underpin the decision to move up the value chain with MLens?
We have never received a NOK 1 NRE from any barcode customer. I think that's the answer to that.
Yeah. Any NRE that is cannibalized by MLens is pure positive on the bottom line.
On the EBITDA. TWedge. You say that you aim to secure external commitments for financing for TWedge before launching a product development program. You also note that discussions are multifaceted and complex, with the outcome being difficult to assess. Given that the commercial window for AR display solutions seems to be 2027-2028 at the earliest, what is the absolute latest date by which you need to reach a financing agreement to still be on time for that window? In other words, what's the real deadline?
I think, as I said, there was one customer who wanted to have TWedge installed in a release in the beginning of 2028. That customer need to kinda commit to a program now, and we are not there now. In discussion with that customer, he also admit that, you know, those plans they have for that advanced display solution release is also subject to changes potentially. It's still a little bit up in the air. What I said in, not this quarterly report, but the Q4, is that there are indication that many customer is saying to us that in two years from now, we probably need a mass production version of TWedge. I think there are uncertainty in that statement.
It's not easy to say, but what I'm telling the customers, "If you want to have, you need to kick off a program." And that's where we are now. We are discussing when what kind of terms can we agree to and when can we start.
Yes. There's another question here about those terms, actually. Wanting to know what optimal terms for poLight could mean in practice. Are we talking about an upfront cash contribution, a royalty structure, equity stake, or something else? Is there a walkaway scenario if terms aren't agreeable?
Yeah. That's a little bit premature to say because we are in the beginning of that discussion. Typically, as I said, typically what a customer is wanting if they pay something, they would like to have something in return. That something in return, typically what they like to see is exclusivity for that particular design, is some kind of protection for that particular design. That's something which we try to avoid as much as possible. At the same time, it's difficult to completely, what should I say, not give anything in return for financing. It could be also elements like a discount on future component supply. You know, it can be time-limited exclusivity for a particular design.
There are many ways of doing this. As a starting point in those discussion, poLight has to take the position, "Dear customer, we understand your need. We can kick off a program for you, and what you get from that is a component you need in due time.
You know, that's what we try to convey.
I'll ask one last question here, and then we have two questions that we'll leave for the portal because they can be a bit longer.
Mm-hmm. Yeah.
To what extent can an OEM influence or restrict poLight's ability to announce a design-in?
Cannot. It cannot. It cannot. It's us as a company who need to judge that, whether it is a design-in, because that's a design win is clear. That's clear-cut. A design-in is more kind of subject judgment from management. It cannot, a customer cannot stop us doing that. That is by regulation. We have to do it because it's share price sensitive . What they can do is that you're not gonna say anything in that press release which is telling something about us as a customer. Name or indications, that's what they can say.
That's why they normally are on no-name basis. Which is boring, I know, but that's life.
That's life. That's the market we operate in.
Yes.
I'll leave it with a comment to one shareholder who says, "I appreciate very much that these Q&As are held." That's clear because we had a long Q&A also after the quarterly presentation, but today we have answered 49 questions. Thank you, Øyvind . In response to a previous question about a dedicated IR person, I would think we would have to search long and hard for an IR person that can answer these 49 questions with the same level of expertise. Thank you all for participating.
Thank you, everybody. Thank you, Joakim. Yeah.
Thank you all for your questions.
Bye-bye