All right, welcome everyone to Xplora and our Q4 and full 2024 report. It's great to see everyone here live. We probably will expect to have a record of people joining us online on the stream today as well. We also have one additional session later today at this very building as well. We are super excited to see a very big growth in people following the company. As always, or this year, we have with me our CFO, Knut, and our COO, Kjetil Fennefoss, and we will take you through the presentation today. We have quite a lot of good news, exciting news, quite some information to share. We will probably spend 45 minutes today versus the normal 30 for previous presentations. Just a little heads up in that regard. I will first, as always, take you through some of the key highlights.
Knut will then deep dive into some more of the financial details. Kjetil will take you through some of the very important highlights when it comes to operation, and you can see how the development is going on our various business units and segments. I will guide you through some of the post-quarter events, plus how we look into 2025. This time, we actually would like to start with this first screen because it is always very exciting when we start a year, particularly when we started 2024, because we had to share some kind of guidance with you all. In our outlook statement, in our first quarterly presentation last year, we set out to achieve a couple of very important targets. First, we said we should aim for a revenue target to grow 15%. We also said that our primary focus would be to increase profitability.
We had a very sharp focus to increase our EBITDA. We also then said that subscription revenue and number of subscriptions would be more important than unit growth itself. If we can choose any day of the week, we'd rather prefer one new subscriber versus two new watches with no subscription attached to it. We also said on the OpEx side, we should reduce that in percentage of revenue. We also made a promise we should not increase our CapEx, but try to reduce it. We set out, when we started the year, to launch our first senior proposition, as well as try to launch our first SaaS service revenue. That's what we stated when the year started. On that regard, we are super happy, of course, to be able to increase our revenue growth. Instead of 15%, we manage 18% top-line revenue growth.
We are even more proud to actually deliver more than 100% growth in our EBITDA, our earning on the business, to NOK 72 million. As you can see, we manage almost 40% growth on our services, and we increased our service revenue on an annual basis by 30%. As you also can see, our OpEx was down in percentage of revenue, and we actually managed to have a CapEx lower than the year before. When it comes to launching our first senior product, instead, we made a decision to acquire Doro, which we worked on. We will come back to a lot of those details in the outlook. Of course, as we said on the previous quarter, instead of then launching a product on the senior platform by Xplora, we will then push that into the launch into Doro, of course, after that acquisition.
When it comes to the launch of the first services and revenue on the SaaS, we did manage to complete the first implementation in December, and I will come back to some of those details in the outlook statement as well. Before Knut then goes into the details, we will have this slide, as we have had always, the group revenue for Q4 up 15% to NOK 243 million, almost a quarter of a billion on group revenue in Q4. We had a 28% increase in recurring service revenue to NOK 77 million, and we had a subscription base when we ended the year of almost 360,000 subscriptions. Gross profit up 17% to NOK 116 million, and we had an isolated EBITDA on Q4 at NOK 23 million, and we ended with a solid financial situation with cash in the bank of NOK 235 million when ending the year.
With that, Knut will take you through some of the more details.
Thank you, Sten, and good morning, everybody. Sten has already presented some of the key highlights for the quarter, and I'm going to go a little bit more into the details. When it comes to revenue in the quarter, we ended on NOK 243 million, and that's 15% year-over-year growth. The EBITDA of the quarter ended on, as Sten said, NOK 23 million. That's almost a doubling from the previous year. The gross margin continues to stay stable, with then service gross margin to be 83%, and that's the most important part of our gross margin. When you look at the distribution of revenue throughout the quarter, we see that in every quarter we have an increased revenue compared to year-over-year. In Q4, we had then NOK 243 million versus NOK 212 million the previous quarter.
If you look at the total revenues from the year in this graph, it was NOK 813 million versus then NOK 689 million, and that's plus NOK 124 million for the whole year. We have a good growth also for the year. The important point about the gross profit and the contribution from service revenue is that that contributes more and more of the overall gross profit that you can see on the graph below. You can also see how stable and predictable the gross profit from the service part is.
In Q4 2024, it was NOK 64 million out of the NOK 116 million came from services, and NOK 52 million came from devices. P&L, there is a lot of numbers. I'm not going to repeat too many items here. We have a gross profit, as I said, that ended on NOK 116 million. That's up NOK 17 million from the year before.
We have a total OpEx in Q4 of NOK 93 million, and that's compared to NOK 88 million in the year-over-year quarter. This is NOK 5 million, and the major differences in the expenses here are related to, if you take one item, it's actually the employer tax on the option share program. That is a major part of that NOK 5 million deviation. When it comes to 2024, the full year, as I said, NOK 813 million with a gross profit of NOK 406 million. That's a 50% gross margin as for a company as a total. We have then a close-to-break-even profit before tax, both in the quarter and also for the full year. On the balance sheet, we have already mentioned that we have the cash is NOK 235 million. That's up NOK 98 million year-over-year. You can also look in particular on the inventories.
We are on the same level as we had the previous quarter, but before that, we had three and four quarters with inventory levels above NOK 100 million. The main reason why we are able to reduce working capital like this is that we have more predictable forecasts and we are better in our processes. Cash flow, we have been through most of the numbers here as well. There is one item that we can spend two seconds on, and that's the CapEx. That's now on NOK 20 million, as we expected it to be in the beginning of the year. Last year, we had NOK 24 million. It depends on how you round, if it's NOK 23 million or NOK 24 million. If you also remember, we had actually NOK 38 million in CapEx in 2022.
We are now on a quite stable level, and we benefit from the investment that was done in 2022. If you have the key figures for then 2024 as a total, it is the 18% growth in total revenue. We have an annual recurring revenue level now of more than NOK 300 million at the end of the year, and that is up almost NOK 70 million from a year ago. The EBITDA is now NOK 72 million, and that is the 113% year-over-year growth. I have one more thing, and you might have already seen it, but we have also now released a new investor relation web. That is an upgrade from what we have had so far. Please have a look at it, and if you have some feedback, please let us know. Thank you, Kjetil.
Good morning, everyone. I'll spend most of the time today on the service revenue, but I'll also touch upon the smartwatch sales development and also the OpEx over revenue. We set ourselves three internal targets for last year. That was to increase the recurring service revenue, and we truly did it. Increased by 33% for the year, and that was through expanding the subscriber base. We also stated that the service revenue from outside of the Nordic should increase and be in the range between 10%-15% of the total service revenue. We also said that we should sell our smartwatch models at a higher average selling price, and we landed on 4% plus for the year. Also that we should realize economics of scale by reducing the OpEx over the revenue as a percentage, and the result is minus 2 percentage points for the year.
We delivered on our internal targets. Let's start then with the service revenue. We ended the year with a subscriber base of 358,000. That was an increase of more than 100,000 year-over-year, or 39%. Our service revenue comes from four main sectors. The mobile subscription part, which we ended the year with 258,000, has the highest ARPU. ARPU is the average revenue per user, meaning the customer revenue per month. We had a 26% growth year-over-year and 53,000 units net growth. The premium activity platform has now landed at 75,000 subscriptions. That's our value-added service that we monetize on top of the mobile subscriptions. We sell it in two ways, either by bundling it in as a part of the mobile subscription, or we sell it individually through our Xplora app, for instance, to telcos, which customers then subscribe directly with us.
That was an increase of 33,000 subscriptions for the year, or a 79% growth. The B2B subscriptions, meaning when we get revenue from the smartwatches that we sell to telcos, we have that as a new income stream. We now have that with nine telcos. We have five in the U.S. We have four in Europe. That ended on 20,000 B2B subscriptions. We have something which we call a service fee. That is the alternative in the Nordics for those customers who select a different operator than Xplora when they opt in for a SIM card. That is more to leverage and increase the share of our service subscriptions in the Nordic and to maximize it. It is not the objective to sell as many service subscriptions in that category as possible. It is more to leverage and increase the share of mobile subscriptions over smartwatches.
When we then look at the mobile subscription base a little bit more in detail, we see that we increased by 53,000 net for the year. That was a 26% growth. In Q4 last year, we had an increase of 15,000 net. We have seen a significant development in the German market. I will come a little bit back to that as well. Germany accounted for 65% of our net growth in terms of mobile subscriptions in Q4. We also see that we had an accelerated net growth in 2024. Despite the fact that the customer base is getting older, we see a steeper growth curve compared to 2023. 53,000 in 2024 compared to a net growth of 48,000 in 2023. When we then look at the 53,000 net growth that we had in 2024, we see that we had net growth in all our markets.
There are two markets that stand out for different reasons. Again, pointing to Germany, we had 25,000 net growth last year in the German market, and that is actually the highest net growth ever that we have seen in one of our markets in a single year. A significant shift in the German market, which always has been our largest market in terms of smartwatch sales, but we are now also able to actually monetize on the service revenue in Germany. That comes mainly from our own web shop sales and Amazon sales. You may be a little bit puzzled of the growth in Finland. You see that we grew by 1,000 mobile subscriptions. The reason for that is that we see an increased interest among the three Finnish telcos that we do business with. The majority of our service revenue from telcos actually comes from Finland.
We had a net growth of 14,000 subscriptions for service income from the Finnish B2B telco business, which is the highest in any market. Even if Finland is a bit low on our own mobile subscription growth, it's actually in percentage a very, very high growth of the service income in Finland. The premium service, which is our add-on on top of the mobile subscription or sold individually through the Xplora app, we grew that net by 33,000 last year, which is almost 80% growth. That adds approximately, let's say, for the Nordics then, NOK 30 RPU on top of the mobile subscription revenue. As I said, we sell it either bundled in as an option on top of the mobile subscription plan, or we sell it separately through the app.
That is a way of generating also service revenue from the smartwatches that we originally sell without the mobile subscription plan. When we then look in total for the quarter, that is back to my initial slide where I said that one of our targets was that we should increase the service revenue coming from outside of the Nordics. As you may remember, we said between 10% and 15%. The result for the full year last year was that 49% of the service revenue came from outside of the Nordic countries, while it was 17% in Q4. Again, referring to Germany, the highest net growth came from Germany in Q4. We generated almost NOK 7 million service revenue in Germany in Q4, which is an increase of almost 200% compared to the quarter of the year before.
Germany then accounted for 9% of the total service revenue in Q4 last year. I think this is the final slide on the service revenue, but you see that when you look at the device growth last year, we increased from NOK 477 million to NOK 533 million for the smartwatch part. For the services, we increased from NOK 210 million to NOK 281 million. When you look at the difference on the gross profit part, you will realize that 80% of the gross profit growth last year came from the service part. That just underlines the importance of why I'm spending seven of nine slides on the service part, and it's an 83% margin on the service part. That's very important for our business. Let's have a look at the smartwatch unit sales and the average sales price.
The smartwatch is the vehicle for our service sales, and that's underlying then important for the service sales growth. In Q4 last year, we had a sale of 167,000 smartwatches. That's the highest quarterly number ever. It was a 16% growth year-over-year compared to Q4 2023. For the full year, we had an ambition internal number of surpassing 500,000, and we did. That was a 7% growth from 2023. The average selling price is rather complicated to explain because there are so many factors that influence on the ASP. It's, for instance, the currency developments. We buy in dollars and we sell in four different currencies. We have a mix of products with different price points. We have different sales channels that we sell at different prices.
Despite that fact, we managed again to increase the ASP from NOK 1,021 in 2023 to NOK 1,063 in 2024, which was a 4% growth. There is, again, referring to the German market, a different way of selling in Germany. The prices are bundled. We bundle the price of the smartwatch with the price of the mobile subscription plan. Basically, 95% of our sales on our web shops and on Amazon in Germany is on a 24-month contract, but we subsidize, reduce the price of the smartwatch. That influences negatively on the overall ASP for the company. 20,000 phones in Germany and partly in the United States were sold at a reduced price to get long-term mobile subscription plans. That is a negative impact on the, despite everything else equal, the 4% growth. Important to note.
My final slide on the operating expenses. Here is very much the effect comes as a result of the growing revenue. Here you see the total OpEx over the revenue split into three different categories. You see in 2022, it was 54%. We reduced it to 43% in 2023, and then down to 41%, an improvement of 2 percentage points in 2024. We have split that and showed it here in three different categories. We see the employee expenses over revenue. We see the marketing cost over revenue. I want to point out again the effect of recurring service revenue. I mean, marketing cost is related to acquiring new customers. With such a growing and high share of recurring service revenue, we get quite a decent effect on that KPI on the marketing over revenue figures.
But also other OpEx develops in the right directions, down from 16.4% to 15.3%. That was my part. Thank you.
All right. That was a lot of numbers, but good numbers. That is always exciting to share. We now would like to spend a couple of slides to try to make a peek into the future. Before we do that, we have a couple of post-quarter events, so something that happens or started to really materialize after December. One slide we would like to highlight for today is at least a lot of the investors that have been following us for a long time have, of course, made these questions. Where are we on progress on these various initiatives?
When it comes to the service as a SaaS services B2B initiatives that we started early last year, we wanted just to share with you an update on two of these initiatives. The objective of this is, of course, to find models where we can sell or license our product or services to another business partner and, again, charge that on the service revenue model. We had initiation of one project in South Korea. South Korea, remember, is the country that actually kicked off the whole development of smartwatches for kids. They were very early in order to progress. South Korea has always been an interesting market when it comes to the Asian market for us to try to find a way to be involved in.
One of the telcos, Stage Five in South Korea, they wanted to have a collaboration with us and find a way how can they actually use our hardware platform, avoiding themselves to have to develop hardware, as we know, comes with a lot of challenges and investments. We found a way with that MVNO to license our great hardware platform, and they then directly acquire that hardware from our manufacturer, but pay us a licensing fee in order to use our hardware platform. No implication for our cash, our further CapEx, and so on, but they will just license our hardware platform and sell it on their own MVNO, or they are MVNO in the South Korean market. Already started a soft launch on our platform in February with a more full commercial launch in May.
Another point, Kjetil highlighted our steep growth in our premium service, our activity platform, which contributed for like an increase of NOK 30 RPU. It is a good business model for us. If we all recall some years ago, the whole activity platform was actually developed in a collaboration with 360 in China. We had a pilot there with 60,000 customers joining a live platform, which really developed that whole concept. After a lot of collaboration and integration, we managed, as we said, to make another soft launch on that in December at the end of last year. It has been a lot of, well, not a lot, but there have been some challenges in order to really find the best possible way to distribute it and capitalize.
Currently, we have not the ideal visibility on the platform, and we have all, or not we, but they have only integrated one payment solution. In China, there is a lot of different payment solutions, how to capture their money. Despite all that, so far, 60% of the users that are actually clicking on the advertising campaign, going into the actual app, are now downloading it and starting to use it. 5.4% of those users are now upgrading to a paid solution. It is not a significant number yet, but it is a very good start. We just wanted to give you that update in that regard. Both of these revenue streams will now, short term, just be added to our general service revenue, which Kjetil and Knut have been reporting on. When there will become volume into these initiatives, we will, of course, report them separately.
It is part of our service recurring revenue stream. Good progress, and we just wanted to share that with you today. The most exciting and important update is, of course, on the youth and senior. We are basically packing our suitcase, getting ourselves ready to join Mobile World Congress this weekend. Mobile World Congress is, of course, going throughout next week. On Sunday, we will be on stage jointly with HMD. I think it is more than 200 global journalists that will participate in that event, that announcement. We are doing the announcement the day before Mobile World Congress starts. We do it on Sunday with a lot, like I said, from the whole MVNO, from the telco industry, a lot of journalists, because this is a very, very exciting category.
As you know, media worldwide, teachers, parents, everyone involved having kids in the age group 10 to 5, the growing concern about all the negative consequences about social media, internet, we're spending seven, eight hours in front of a screen every single day. It's a really compelling market opportunity for us. The product is ready, as you can see here. We have shared it with some of you guys. You have seen it. It's exactly the same spec as a full-blown Samsung or Apple latest generation, but instead of paying NOK 14,000-NOK 16,000, we are targeting a price range very competitive of that. All the services are, of course, finally ready to launch, whereby same as from our Xplora Watch proposition, the parent can have more control related to whom should be able to call if you would like to have that opportunity.
You can also manage screen time, what type of social media application can be downloaded. All is fully controlled in the relationship between the parent and the user. If you would like, you can unlock all the services, but you can also have control to really make sure your children have a much more safe onboarding into the experience of smartwatches as well. One of the big benefits as well, everyone here having children in that age group, at least one time you have been able to change or have had to change the screen. It costs you NOK 2,000-NOK 3,000 more just to change the screen when you broke it, and you will break it several times. In this proposition, you can even change the screen yourself, and you can do a lot more repair yourself, again, in order to reduce the overall cost.
There comes a ton of different accessories for these products that are very compelling for that target and user group as well. Instead of now paying NOK 12,000-NOK 14,000 for this proposition, we are targeting to get it into the market for at least sub NOK 3,000 with exactly the same specification as the high-end smartphones from Samsung and Apple. I just wanted to share that progress as well, live on stage in Barcelona on Sunday to announce this with HMD. Of course, we are also getting ready to step into the senior market with Doro and post events here. As you all know, deal was closed on 88.3%. At that time, only a couple of weeks ago, we were missing out 427,000 shares to reach the 90% mark. Since then, a couple of weeks ago, we have been able to purchase 319,000 in the market.
We still have a gap of roughly 100,000 shares, which we are working on and hopefully soon will accomplish. We will, of course, only pay NOK 34 per share as the offer made to everyone. The only practical reason is, of course, we need to make 90% in order to start the de-listing from the Nasdaq, as we would like to do as soon as possible. In February, we had the great pleasure to be, you can see us smiling, we had the great pleasure to be on site in Malmö to meet the full team, the management team, the engineer, everyone from Xplora. We had a great experience. It's a fantastic team with a lot of enthusiasm, a lot of knowledge in, of course, in their industry. They just celebrated their 50-year anniversary. It is a lot of tradition and culture within those walls. Great experience.
We did officially also sign an agreement with them, allowing us to go into full implementation of our SIM and operation even before having the 90% of the share. With that agreement signed, we are technically and officially allowed to go into full implementation in order to start to both plan and operationally-wise start to integrate our SIM card. Next steps, we are continuing to buy the shares in the market, and we can still uphold our Q2 target for being in the market with the Doro product installed with our SIM connectivity. We can still aim to have that launch to be in the market. Also from Q1 this year, we will be presented number with consolidated. So Xplora plus Doro, we will report those number combined from Q1. All right. That means road ahead.
We now have a very strong portfolio to reach our goal, 1 million subscriptions with our kids product targeting kids 4 to 10. From Sunday, when we announce our full proposition in the youth market, 10 to 15, and also the senior market, 65+ with the Doro. Going forward, we will still report individually for kids and youth segment as one category and the senior market as one category, but we will consolidate all the numbers like I mentioned from Q1. Just by that, we have become a significantly bigger company starting right now. As you heard Knut present, 2024 standalone, this is history with Xplora. We have up until now been operating in nine markets. We achieved a steep growth to NOK 800 million revenue. We managed an EBITDA, a profit of NOK 72 million, and we managed to sell more than 500,000 products.
As of right now, and as we'll present from Q1 going forward, we have doubled our market reach, both with HMD and with Doro. We are now a company that has NOK 1.7 billion worth of revenue when we combine the 2024 number. We combine almost NOK 200 million worth of EBITDA, and we have a pool and portfolio of our product of almost 2 million where we can install and integrate SIM. Just to combine it, if you remember the Q4 number, Q4 number consolidated Doro and Xplora, we are now a company that in Q4 had more than NOK 500 million revenue isolated in Q4. As you also can see, consolidated combined in one quarter Q4, NOK 72 million of EBITDA, which is actually exactly the same number we had on our full year. That is now the consolidated number for one quarter Xplora and Doro combined.
We have suddenly become a lot larger company with significant number, and that is even before we start the integration of the SIM cards. Now a company of NOK 1.7 billion of revenue, NOK 200 million EBITDA one full year in 2024. The big opportunity, as we have mentioned before, is now to pre-install the SIM card in the Doro portfolio of products. As we said, if we are able to get one out of 10 Doro phones to activate our SIM card, as you know, in Xplora, we have managed 25% of the overall volume we are selling to activate a Xplora SIM card, 25% in a couple of years. If we manage 10% of the Doro watches being sold, one out of 10, we will have more services, we can have a better price, it's easier to install, and we have additional services on top.
If one out of 10 will activate that pre-installed SIM card, we will have an additional NOK 300 million EBITDA in year two. That's our big opportunity starting from a company now at a size of NOK 1.7 billion, already generating NOK 200 million EBITDA, 10% connectivity will add NOK 300 million more, and we have more than NOK 400 million cash in the bank combined. The outlook, we will leave on that page. What we are saying now in Q1, because a lot will happen in Q1, and we expect to come back with even more details within this outlook statement. For now, what we're saying, we will introduce our first youth product, as we said, in Q2 this year. We will continue to have an annual growth in our kids category.
We will introduce the first Doro product with SIM in Q2, and we will prioritize service revenue growth and to really increase our profitability. We will always prioritize to drive shareholder value by increasing service revenue and really increase profits, both on EBITDA and EBIT level, and we will secure a path to make sure within four to five years, we will bring home 1 million subscriptions. With that, summary of 2024, we can deep dive into Q&A. If questions, Petter, as always.
Yes, thank you. Just kind of overall questions with regards to how scalable the business model is. If we just assume that you are able to be at 50% gross margins and you get kind of the scale that you want, what type of EBIT margins are you kind of internally then talking about?
I do not think we should comment on that for the time being.
As Knut said, we are in the middle of the process implementing the Doro solutions, and I think we should come back to that.
What we can say on that.
Okay.
Not directly, but what is interesting to calculate, Petter, is of course, Doro has already achieved 50% on their hardware as standalone, having no service revenue. And as we did say, by testing 10,000 actual user profile, we do see that we will be able to keep the same margin north of 80% on SIM also integrated into Doro product. We have 30% hardware and 80% on our services. Doro already have 50% on their hardware, and we're expecting to keep the same margin on the SIM for Doro as well. That gives an opportunity to calculate that question with the growth we have anticipated.
We have also now finalized the price negotiations with the telcos on the wholesale cost of the service with the telco cost for the traffic. That just makes us more confident that we will deliver good and high margins also in this section. We have picked, after taking probably the most profitable segment, which is the kids segment because of low data usage, knowing the fact that 90% of Doro sales is feature phones, which have no data, we are pretty confident that we are going to have a very good gross margin also on those subscriptions.
The youth telephone market, the ones between 10 and 15, is that, have you done any pre-marketing or got any orders there or something, or is it just now launch and then we're waiting for something to happen? Or is it already some pre-orders?
Good question. If not everyone heard or for online user, has there been any pre-order or marketing campaign, etc., for the youth category, or will that basically start when we are launching? To some extent, yes, it will start at the point of launch, but two comments I would like to add on that. One is that HMD have been working for a couple of years with 10,000 families and users in many different markets. Already there is quite a significant, very close user group that, of course, is very involved in the development that will be, of course, targeted toward the first product. Also, there is a significant interest from retailers and telco, meaning that we assume to close quite rapidly a significant number of deals in that regard once the product is live in the market. There has not been any pre-sales of the product.
The simple reason for that is because we believe it's such a huge market opportunity that we have also been hesitant in order to release too much information in the market about the exact product specification, pricing, and service application before we actually launch and have secured multiple telco and retail deals.
We also have HMD's sales organization lined up. This is not only Xplora's sales, people selling the product. As you may remember, we also get a service revenue from the Xplora application regardless of who actually sells the products, if it's our sales organizations or HMD's. It's a much bigger potential addressable market and countries and market than we are used to.
Two questions, I think, is Gisle. You focused a lot on the German market, but recently we've also been into the U.S. market, and I saw that that's about 4.2% or something.
Can you comment a bit on how that is developing and also a little bit on the other markets except for the Nordics and Germany to have an idea of whether the rest and how the watches are developing? Secondly, as a result of the Doro market, what do you expect to expand your geographical markets for the Doro to some of your markets and for the smart watches for some of the markets that I know that there is more or less the same, but it is a bit different also at the German market.
Yeah. All right. I can summarize for the live audience.
Kjetil, why don't you first take the question, the development in the U.S. in service revenue, for example, expectation and development in the U.S. market, and then comment in general on the development in the market in Europe in general, but outside Germany and the Nordics. Afterward, we can comment on the overlap of new market opportunity with Doro. I can address that if you start with yours.
All right. Yeah. As you saw from the pie with the revenue distribution in the different countries, you saw that the majority of the net growth in both last year overall and for Q4 was specifically high in Germany. The question was specifically about the U.S. and other markets.
In the U.S., we have been talking both about, let's say, getting the product approval, which we had last year, but also lately been answering questions regarding our MVNO setup on AT&T's mobile network. We completed that finally in January and went live with our AT&T-based MVNO. We had net growth in the U.S. of 3,000 subscriptions in Q4. There are positives and negatives about the U.S. I would say that we have the products approved and in place. We have the MVNO setup completed with roughly 20 percentage points higher revenue. On the downside, we are facing increased competition, especially from a private equity-based American company that gives away their phones for free. We don't quite understand the business model. Also, from a higher churn and return rate in the US market in general, not only for smartwatches, but for products in general.
Both in retail and online, there is quite a high return rate that is different in the U.S. compared to what we're used to in the European markets. Also, the churn is much higher in the U.S. than in Europe. That, of course, puts, let's say, a restriction on the net growth that we see in the U.S. market. For the other markets, we have done a shift both now in the U.K. and in Spain to be much more focused on going online. We have very good sales figures on Amazon, and we have also just lately restructured our web business. Instead of having that individually in each specific country, we have now centralized it and recruited through specialists also from the U.S. to drive our web sales business.
We're doing a shift in both Britain and in Spain, going more and more focused online on web and Amazon versus previously we've also been a lot in retail. The challenge when you are both in retail and online is that you get some significant pricing challenges between the channels. We're trying then to utilize the best of our internal capacity to grow in the channels where we see that we are strong and successful. It was a long answer, but then over to the second part.
On Doro, I would emphasize two points. One is that more or less it's a very strong overlap with our MVNOs and the Doro volume, but it's in particular one market where we see an additional big opportunity, which is France, where it seems that Doro have a good presence and we also have a finalized MVNO setup, but a market that we barely have started to grow our watch business. I would emphasize France as a big opportunity. Otherwise, we'll focus on where we have the best overlap. Also, actually to comment one more thing, as Kjetil mentioned on HMD, with HMD, we will get also additional market reach, which might also bring some additional opportunity for all our products.
Just a quick follow-up on the go-to-market strategy with Doro. Have you kind of finalized whether or not you will target one, two, three initial markets or if you will get kind of broad in all of their markets?
Yes. Thank you for commenting on that because I did not actually mention one of those bullet points. It was on the screen. One of the key objectives with our onsite in Malmö is to start to plan exactly what you are saying.
Because what we will do with Doro, we would rather emphasize a lot of focus on one country and one channel and really make sure that we learn to execute that very well and also in order to provide good data back to both ourselves and the market on how we see that conversion and then start to scale that model into more channel and more market versus going very broad and try a little bit in all channels and all market. Which channels and which market we have still not defined, but that will be the go-to-market strategy to really make sure we execute well in one channel and one market first. That is also to replicate the same way we approached Xplora sales initially. We really executed well to find a model we could scale into more market and multiple channels.