Good morning everyone, and welcome to our first half year and Q2 results presentation. I would like to open this quarter by saying how proud I am of the full Xplora team. In a market with a slight reduced or softer consumer instrument, once again, we have proven something really, really important. Our business strategy works very well, which we will present, but also the team's ability to execute in such a market. We have surpassed a very important milestone, more than half a million subscription. We have improved our gross margin, and we have increased our EBITDA after CapEx by more than 50% or 50% this half year. For the presentation today, we will have quite a lot of the team members on the stage to present, because we would like to do a little bit more deep dive to give you even more insight than a normal presentation.
I will start to do an intro with some highlight, but I will actually take you a little bit more behind the scene as well this time. Then, of course, Knut will guide you through all of the financial results and details. Then Gro will take you through our business unit from kids and youth products. Then Tommy will guide you through the full senior update from previous Doro, because now also Kjetil will be on the floor to give you the latest and greatest insight from the latest emporia acquisition, both eventually to be one division from senior. Q3 will be the first time we will report those numbers. At the end, I will take you through the normal road ahead.
Before going into some of the details from this first half year and the quarter, of course, as normal, I will just guide you through the high level number. First half year, we had a group revenue of almost NOK 800 million, flat from last year. Our recurring service revenue up 13% to NOK 182 million. Gross profit also up to NOK 433 million. As I said, our subscription base, we are halfway to our goal for NOK 1 million. We passed NOK 500,000. Our EBITDA, and please pay attention to this, the reported EBITDA for the first half year, NOK 76 million, up 11%. Underlying, it is 89%. We will come back to these details, but as we are acquiring companies, there will be one-off cost.
As we discussed with you guys and the market previous quarter, we will make sure to give you the details so you can follow the underlying performance of the company, hence the NOK 89 million. EBITDA after CapEx, as I said in the introduction, up 50% this first half year to NOK 56 million, and still a very strong and healthy cash balance of NOK 537 million. All right. Would like your attention to the following. As we have mentioned a couple of quarter, we would like the market to really put the standard and follow our performance for the following three KPIs. Our ability to deliver strong gross profit growth, of course, our subscription base and our overall service revenue, and like we said as well, for a tech company, follow our EBITDA after the CapEx.
That is why we said initially as well, in quite a demanding, challenging overall consumer market, it is very strong to deliver on these three key KPIs. I now would like to take you through how we are planning and how we have the right tools to continue to perform on these KPIs in the next quarter to come as well. Starting with the first one, how do we foresee to continue to be a strong growth company in the months and years to come? We have provided ourselves three very important tools to make sure we can continue to grow. When we are saying growing, it should be profitable growth. Please remember that as well. We will come back to that. Number one, we will showcase and demonstrate to you today how we actually have further improved our retail model.
As you all know, we are now where we would have liked to be one or two quarters ago when it comes to the Senior Connect implementation. We will talk a lot about that today. However, we have invested that time very wisely because we have developed the same incentive tools and point of sale, which we now can utilize for all our product portfolio. Meaning we have stronger tools to continue to grow our business across all products within the retail. We will showcase that a little bit later. A new POS model for all our products. Also, as a consequence of acquiring emporia, not only are we adding a lot to our unit base selling our product, but we are also now extending in the future into two new markets with a strong brand and a position, Switzerland and Austria.
Of course, one way for us to continue to grow is to extend into new markets, particularly in a market where a category leader. Also, we are optimizing our product portfolio. As we know historically, new product means more sale. We have now acquired two companies with a fleet of great products. What we have been doing this first half year is to make sure that all these products now going forward can be used across multiple categories. One of the biggest growing categories, the youth category, is one example. We will pay particular attention to one of the products that came with acquisition of emporia, the new 5G product I am sure Kjetil will present. So we have provided ourselves some tools in Q2 to make sure Xplora is a growth company.
The second one of the KPI we said is our ability to continue to grow our subscription base. We reached the halfway mark. We are on track on our 1 million target for 2029. If you recall back to our capital market day, we said four to five years to goal for 1 million. We are on track for that for 2029. We also stay very firm, and let me just underline that one more time, very firm on the commitment that part of that 1 million in 2029 should be 200,000 SIM subscription for senior. That is one of them, and we stay very firm on that.
Even though there are small numbers for the current online sales for Senior Connect and our one pilot store, we also stay very firm on the current data points we are seeing to continue on the communicated attach rate of 20% based on the data we have today, online and the retail store combined. Small number, but what we know is the following: If it works in one store, it will work in more store. We need the time to execute. As well, we have received the feedback. We actually have potentially the best point of sale solution within the category when it comes to how easy it is for a retailer to connect and activate our SIM card, like I said, not only for senior, but for the whole range of our product.
We know this POS word is, we find it easy to understand, but we have received quite a lot of question. What is it? You have talked a lot about this POS system. I would start by saying something very clear. It was a lot more work than we have ever thought. Hands down. It was. Because we have done it for wearable products for kids. We got a lot of waivers. We didn't even have to have a POS system in the store. SIM card was pre-installed. Customer activated it on our website. It was super simple. Now we had to have the same solution as Telenor, as Telia, as all these giants. So when a customer buy a product with our SIM card in a retail store, the seller needs to have all the details. They need to have all their margin.
It needs to be a provisioning system so the retailer know exactly how much money they are making, and it's a lot of background work. It was more than we expected. That's why I said initially, we are now where we ideally have hoped to be a couple of quarters ago. But the model is scalable, and it's a lot easier now to implement in other retailer. But like I said, when we saw all the work for doing this for the senior product, we made sure that we have multiple work streams in parallel. Because what we did was to make sure that not only can we use this system for the senior product, but like I said, we can use it for all our products.
The image in the middle is simplified just how a retail salesperson are getting this in the store when they are selling the product, so they can see how much money they are making, fill in all the name, and make sure everything is activated in the back end. Why is this important for all our products? Let me try to explain because it's very important for our investors to understand this fully. Historically, when we have sold a smartwatch for kids, the retailer have no relationship to a SIM card being inside that product. We have sold them a smartwatch with a margin, and that's it. What we are now doing, we are still selling them this smartwatch with a pre-installed SIM card.
However, when they are now selling that product, they will have the ability to select SIM plans from Xplora so they can further improve their margin, meaning that we are able to allow them to select a more profitable SIM plan for us, and then we can give them some additional incentives to sell more Xplora products. That will be a very strong tool, particular outside of the Nordics. Why is this particular important in a market where you see the consumer are spending less money? It is very important for our ability to really incentivize the retail salespeople to sell product, and we have more flexibility on price. Just wanted to repeat what is the POS system. It has taken longer time. We are now where we really would like to be, and we can use it across all our products.
The last point before we go into the financial update is, like we said, also one measurement as a tech company, our ability to deliver strong EBITDA after the CapEx. The synergy we are now having with our current two acquisition is already we have executed the first plan of redundancies, roughly 25 people in the first integration. We have also articulated to the market that we expect roughly NOK 50 million as a direct operational cost reduction that will have a direct impact on our P&L. Timing-wise, for that, we will see the full effect in 2027. Put it very simple, if the business is exactly the same next year as this year, it will be a NOK 50 million reduction NOK 50 million increase on the EBITDA compared to similar years. It is a huge effect on that synergy.
As Kjetil will come back to as well, the original plan for Doro when we acquired was to start the development of a 5G product. With the acquisition of Doro, it is now done. Kjetil will present, and that alone has a direct CapEx effect over the time of that product NOK 40 million. Hence why we are seeing we are in a very good place to continue to fuel our EBITDA of the CapEx in the year to come. Just wanted to take you a little bit behind the curtain about some of these drivers before Knut now will guide you through the financial update.
Thank you, Sten. Good morning. I will guide you through the financial update, and I will focus on some of the key numbers. Repeating what Sten said, the EBITDA of the CapEx for the first half NOK 56 million, and that is up 50%. That is a very important figure because it shows that we are focusing on the profitability in the business. Why are we also focusing on after CapEx?
CapEx is mostly for a tech company like Xplora capitalizing of R&D costs, meaning that if you capitalize something, you put it in a balance sheet and you reduce the cost in the P&L. That is why it is very focused on this metrics. For the first half, it was a flat revenue development, NOK 798 million compared to NOK 802 million. But the gross profit was increased to NOK 433 million because we had a small increase in the gross margin of 1%.
Going to Q1, the majority of the EBITDA of the CapEx was actually generated in Q2, NOK 38 million, compared to NOK 36 million a year ago. The device revenue was down in the quarter with 13%, but the service revenue was up with 10%. Even though the total revenue is down, we still were able to have a flat gross profit because the overall gross margin increased from 50% to 54% in the quarter. Two reasons. One, we had a favorable product mix in both segments, both in the Children and Youth segment and in the Senior segment. I think I stop there.
We are talking about one-offs, and we have a few one-offs every quarter that we need to specify so it is clear what will be a specific number. In last year, we had a transaction cost of the Doro acquisition of EUR 2 million in the quarter. In the first half, it was EUR 13 million. In addition, we had also a provision in Doro for closing down IVS. That is EUR 9 million. In this quarter, we had EUR 3 million that we have spent to acquire emporia, and we have also a provision for redundancy cost of EUR 9 million, EUR 12 million in total.
This provision of redundancy cost is linked to the 25 FTEs that Sten mentioned. If you say then the EBITDA reported was NOK 49 million, adjusted for these one-offs, we came to NOK 61 million, then a slight increase in EBITDA in the quarter. This slide shows a lot of numbers. If we can focus on a few of them, we have the CapEx in the quarter, NOK 11 million compared to NOK 15 million a year ago.
The main reason why the CapEx is down is that we have now the opportunity to optimize our R&D project and see what would be the future product portfolio of the Xplora family. This is one reason why the CapEx is down. Last year, we had also some CapEx related to the Aurora launch in Doro. When it comes to the total group revenue for Q2, it ended on NOK 422 million. That is down NOK 40 million year-over-year, and it is mainly related to a decrease in Doro revenue that we will come back to.
Gross profit, flat for the quarter, even though we have a group revenue. Of course, it is because of the gross margin. The EBITDA is down before adjustment, down NOK 2 million year-over-year. When it comes to segment, the Children and Youth segment, we had an increase with NOK 11 million year-over-year from NOK 216 million to NOK 226 million.
The service revenue then is the most important factor in our gross margin. It is 80% gross margin on average in the service revenue. The average annually recurring revenue ended on NOK 359 million . The service revenue is down from NOK 92 million to NOK 90 million in the quarter, and you can link the majority of this decrease to exchange rates. If you adjust for the exchange rate, we have a small increase in that number as well. In the Children and Youth, the gross profit increased with NOK 13 million, 10% in the quarter. Of course, the main part is linked to the improved gross margin. You can see that there is a reduction in gross profit compared to Q1, and that is also because that in Q1, the portion of service revenue is much higher than in the other quarters.
When it comes to the Senior segment, we had a decrease of 20% in the quarter. Tommy will get a little bit more into it. But a year ago, Doro launched the full new product palette with Leva and Aurora during the first half. They had a very strong Q2. We ended the quarter of NOK 198 million in Q2. Gross profit keeps to be good, and that's mainly because of the product mix in the quarter. Profit before loss improved to NOK 8 million from a loss of NOK 23 million a year ago. Please note that the NOK 61 million was linked to mainly non-cash exchange rate expenses on the loan. Still, we have a positive profit before income tax in the quarter.
When it comes to the expenses, we had NOK 180 million in expenses in the quarter, and that exacted the same amount as we had one year ago. Even the last 12 months operating cost, it's continuing to declining, and we are still focusing, of course, to do this in the coming quarters. When it comes to the balance sheet, I would like to pay attention to one item, and that's the inventory. The inventory is up, and the main reason for that is that now we are sending more goods by boat instead of air freight. We are saving a lot of money on doing that, and that is, of course, also impacting the gross margin. The inventory level is quite important to have available now when it's a bit of uncertain global situation.
We are also then preparing for the back to school and the last two quarters of the year. Cash flow, I think we should mention at least one thing. We have now settled the remaining Doro minority shares. We have spent NOK 30 million on those fees. I think that's the major part in the cash flow. We ended then on the cash NOK +3 million- NOK 537 million for the year. Thank you. Gro?
Thank you, Knut. In the Children and Youth category, we see growth despite a softening consumer market. This is underpinned by structural tailwinds for Safe Kids technology. In the regulatory market, we see greater focus on child safe, age-appropriate technology with parent controls. In the parents' perspective, we see growing preference for connected but controlled technology that gives kids independence without unrestricted access to social media and smartphones. With that, we end up on a growth of 11% year-over-year when it comes to unit sales. We ended at 171,000 units per first quarter. Our biggest markets are all growing, and in Q2, we see a slight decrease of 1% year-over-year, and this ties back to what Knut already said about the partners and distributors holding a little less inventory.
If we look at sell-out numbers, though, we do experience growth also in this area of unit sales. We ended up at 127,000 total activations per Q2. This is up 3% across all channels, and the service attach rate is also slightly up, ended at 38%. This means that 38% of all devices from Xplora that end up in customer hands and consumer hands pay a service fee, an Xplora Connect monthly fee, or a revenue share fee through our telco partners in the market. Keep in mind, premium services are not included in this attach rate. If we dig further into the subscription numbers, Sten already mentioned we are over halfway to 1 million subscriptions. We passed 502,000 subscriptions per Q2. This is up 108,000 subscriptions year-over-year, a 27% growth, and all subscription types are growing.
Both mobile subscriptions from Xplora Connect, which still represent by far the biggest share of subscriptions at 310,000 subscriptions. As I said, we see growing subscription rates across all types of subscriptions. If we look at service revenue, service revenue per Q2 is up 10% year-over-year. We ended at NOK 90 million in Q2. We also see, as both Knut and Sten mentioned, increasing annual recurring revenues, where we ended up at NOK 359 million by the end of Q2. What it is worth mentioning here is that we see an increasingly diversified growth across markets when it comes to service revenue. What does this mean? It means that a larger share of our markets take up the growth. The growth is particularly high in Germany. This is good because it is also our biggest opportunity in the current market for extended growth.
It does impact the ARPU, which is slightly down from earlier, when a bigger share of the service revenue was tied to the Nordics only. This means, and you can see the market, the ARPU mix here, it is lower in, for example, Germany or outside the Nordics, most importantly in Germany, simply because the prices of subscriptions in Germany are lower than in the Nordics, not only for us, but generally for the market. With an increasing share of service revenue coming from outside the Nordics, this is a trend that we are comfortable with simply because the growth opportunity outside the Nordics is much bigger. To wrap up, we continue to grow in the children and youth category. We have good momentum into the second half. We are now well into our second-biggest sales season in the year, back to school.
If we look at the current numbers from the markets where we are already into back to school, the Nordics specifically, we see strong numbers. Germany, particularly worth mentioning, started back to school on Monday. We are also nudged into the second half by the point of sales system that has been implemented or piloted with the Doro products. We have silently piloted this point of sale system in 10 stores over the summer for the Xplora side of the business, and we see that the model is scalable, and we will continue to implement this over the course of the rest of the year.
This is with particular focus on the Nordics now initially, simply because retail is such an important part of our sales in the Nordics. And last but not least, we see early signals of cross-sales across Doro and Xplora, former Doro and Xplora, where we have closed new contracts in both retail and telco in France, Belgium, and the U.K. into Q3, actually. So with that, I want to pass it on to Tommy. Thank you.
Thank you very much, Gro. Very proud to work alongside with Gro. And also, we are in exciting times within the whole group. Across the Xplora products, across the Doro Senior products. While we are maintaining the business, we are also building the future. And let me talk about the numbers first. So if you look into first half 2026, we ended up at NOK 443 million . Compared to first half 2025, we are down with 7%. Looking into specifically the Q2 numbers, we ended up at NOK 198 million , down with 20%. And as mentioned also previously by Sten, looking into 2025, was an exceptional year. We had a lot of sunset activities going on in several markets, including also, as Knut mentioned, a new portfolio so we could piggyback on the sunset activities.
Looking into where we are right now, sunset, we have in Nordics, basically in the end state, as you can see on the slide. Frabel, still ongoing, closing down 2G and 3G networks towards the end of the year. And looking into rest of the Europe, mainly U.K. and Germany, 2G networks still available, but 3G network has been closed down. What we can also communicate, the normalized annual device volumes within the Senior segment, we are talking about around 1 million. 2025, we ended up in 1.3 million, where we utilized the sunset activities that was taking place across the different markets. And this 1 million is also in line with the baseline for the acquisition of Doro.
Also, as you can see on the right side, rest of the Europe, we are then strengthening the Senior segment in the DACH region, where we are coming in with strong sales in Germany. We have Austria, we have also Switzerland, and Kjetil will talk more about that. Looking into unit sales specifically, we are talking about 241K in Q2. Majority, as you can see, is feature phone, and then smartphones on top of that. If you look into first half, we could see that we are slightly down compared to previous years of 4%. However, what we are proud of, we have managed to maintain the average sales price and also increase the margins for our smartphones. And also we have managed to maintain the average sales price for a feature phone and also slightly higher margin.
That has led us to increase of the gross profit of 4 percentage points in Q2 2026 compared to Q2 2025. We are also proud that we have delivered NOK 99 million as a gross profit in Q2. So that is where we are when it comes to the business. Looking into the future, this is actually what we have been waiting for. We are extremely proud where we are today. As Sten mentioned, yes, we are where we would like to be previously, but we have learned a lot and what we are doing, we are building the foundation for the future. It is more important to build a solid foundation so we can also piggyback and also improve our business going forward.
In the spirit of our purpose as a company, where it is to build a safer, healthier digital lives for all generation, for the family, we have completed the pilot together with Power. You can see the feedback on the slide from Power that we have successfully completed the technical pilot. Coming more to that in a minute. You can see some images. For those of you who have not visited the pilot store that we have had in Hamar, you can see how nicely the products are being displayed and also how we are communicating the connectivity subscriptions in the store to increase the visibility.
Deliberately, we did not do any significant marketing, and that is something that we also agreed upon with the client that is coming in the next phase to really secure that we are building a foundation that we can then build on for the future. Again, as mentioned, the point-of-sale system is being utilized across the group that we have invested in. Okay. So technical pilot, what does that mean? That means that you are piloting and assessing many different parts of the platform and the processes, which means when staff on the retail floor can really go through the different steps together with the end consumers. Activation needs to work. The contract signing needs to work. The provisioning needs to work. There is a number of flows that needs to work.
As mentioned previously, what we are also extremely proud of is, yes, we spend a bit more time, but we have a state-of-the-art point-of-sale system, and that is the feedback that we receive from our customers. That is super crucial and super important because at the moment of the dialogue between the staff at the retailer and the customer, it needs to be efficient. It needs to be simple. It needs to be straightforward. We have evaluated all these different processes in the technical pilot. We are very proud of that. Looking into the timeline, what is the next step? Pilot completed for Norway. Now in September, we are starting with the full rollout, and that will be done in different phases. After that, we will then optimize the business as part of running normal business.
In Sweden, we are doing preparations for a technical pilot. Do a similar thing what we did in Norway. We have learned a lot together with the customers, replicate that short pilot in Sweden, and then we will do third rollout in Sweden. What you can see on the right side of the slide, we will now start with marketing activities. From Xplora perspective, we will launch a campaign Connect With because it's all about connection. How can we support consumers out there to connect with family, friends, parents, children, grandchildren? That is key. That will be our key message when we are running the marketing campaigns going forward.
On top of that, we will do some activities together with the client as well. We will do co-marketing. In store videos, we will include our offering and the value that we are bringing to the table in the Power newsletter to all their consumers. We will do meta campaigns and also additional in-store and digital activations. A lot of things will happen as we now roll out to more stores. That is the foundation that we are building. I would like to take the opportunity to also say kudos to the whole team within the group.
A lot of collaboration from sales, from finance, from tech, from marketing and business management. Well done, guys. Thank you very much for that. That was one milestone that we are very proud of, building the foundation. The second milestone, we have talked about this. How can we strengthen our offering even further towards the consumer, utilizing the assets that we have within the group? This is actually what we are doing. We have now done a soft launch of premium services within our smartphone category that will then gradually expand into the portfolio and also into our feature phone.
We have worked with seniors for many years, and we know what they are struggling with, and we know also what is important for them. We have also recently done some market research to validate also the activities that we are doing and the areas that we are addressing, as you can see on this slide. Safety, crucial. Assistant, crucial. They want to get support, but at the same time, they want to feel independent. The health category is also a very important category for the seniors. On the left side, you can see scam protection. We are introducing scam protection into our portfolio and into our offering towards the seniors as of now.
Remote control. We all have experience of most likely tech support to family members or to the senior family members. Hey, can you help me? I have problems with my phone. I managed to change a setting. I can't find it, or, I want to do this. Can you help me out? I have done that a lot towards my parents. Now my kids are the tech support to my parents. That is usually how it works. What we are now adding, an opportunity for you to support your parents remotely. You do not have to visit them physically, which means remotely change settings or remotely guide them through the device. Extremely proud of that. Health. We are also starting to introduce the opportunity for seniors to share how much they are moving, how many steps they are collecting. Family and friends can see that.
So what I will show you a short video of a couple of images just to give you some glimpse of what we have implemented in our smartphones. As I mentioned, we are now introducing into the market as a soft launch. On the left side, you will see the senior device, and on the right side, you will see the family member device. A family member could be a child, it could be a grandchild, or even a friend. So let's start. Scam protection, very important feature for the seniors. On the left side, you can see an example that is a call is coming in, and it is basically a scam call. The service detects based on a database that we have. This is scam. The call is being blocked. It is being highlighted also into the menu to the senior and also to the guardian.
Example of remote assistance. You can see the same images on both screens, which means both are accessing the same screen. Location, you can see here that as a family member, you will be able to also see the location of your seniors. You can also add safety zones as well, which means you can get notification if a senior is moving out from these settings. This is also an example of remote settings where you, as a family member, can change the settings in the device. This is being now introduced in our smartphone segment. We are introducing that, and then after that, we will introduce that in our feature phone segment, coming that towards end of September, beginning of October, and then we will then gradually roll that out across the different markets. With that said, as I mentioned, we are building the foundation.
We are managing operations. At the same time, we are building foundation for the future, which means that this is contributing also to the evolution of the Doro brand that previously was recognized as a strong hardware brand for the seniors. Now we are extending that to include connectivity, extending that to include premium services, which means that you have a complete package. As Sten mentioned previously, we now have a different toolbox in terms of how to address the consumer needs and also how to support the different markets out in the market. Basically, what we are focusing going forward, roll out Doro Connect in Norway together with Power. Very proud of that. Preparing the launch and pilot of retail in Sweden together with Power. We are also planning to broaden the channels, as I talked about today, and also expand the markets in the key markets.
Now we are going into an ongoing operation to drive it as a normal part of our business to expand our services and our connectivity across the different markets. Last but not least, the introduction of premium services. Started with a soft launch in our smartphones. Now we will also extend that to our feature phones, and then we will do commercial launch towards the end of September and the beginning of October. With that said, thank you very much, guys .
[Non-English content] that's [Non-English content] or hi, hello in Austrian version of Germany. I relocated to Linz in Austria earlier this summer, just when we did the closing or a couple of weeks before. Since we haven't consolidated the company yet, we will do that as of next quarter, I will focus today to give you a little bit background about the company, but also proudly present our new 5G-based product. A few words about emporia. It is a family business before we acquired it. It was founded in 1991 in Linz. Linz is just in between Vienna and Salzburg, and it's a lot of industry, aluminum, chemistry. It's a city and an area with a lot of things happening in Austria. The company has currently around 65 employees, and it's a specialist in senior mobile technology.
Over the years, the business has sold around 16 million devices, and there are currently 3 million active users of the products. The key markets are partly complementary to Doro, and that was one of the reasons why we acquired the business. The company is market leader in Germany, has a very strong business in Austria, but also present with good volume in Switzerland, in Italy, in Belgium, and in the Netherlands. That means the majority of the sales volume is on top and not in any way competing with the Doro business. The brand is the market leader for senior phones in the DACH region, meaning Germany, Austria, and Switzerland. It's a European design. The products are, as all other electronics, manufactured in China. When it then comes to product, Sten mentioned the CapEx of developing a new 5G product is high.
One thing is the initial development, but you also have to continue investing throughout the life cycle of the product. It's a roughly EUR 40 million CapEx effect that we got actually incorporated in the enterprise value when we acquired the business. I will play a 15-second video just to show you the product, and then I will talk about the product and why this is unique. It's without sound, but just showing the product how it looks like. There are a couple of specifics in this product that I will just tell you about in a minute. Now you probably wonder, Sten asked me, what on earth is this? Actually, you know the situation with the toast and the butter, it always lands on the butter side. Everyone thinks it's because of the weight of the butter, but that's not true.
It was actually the Nobel pieces for physics and other scientific areas. In 1996, there was one guy who actually did a study on this and was rewarded an alternative Nobel Prize. It was not by FIFA, by the way. It's actually about gravity and rotation. When you lose a toast, it rotates halfway and lands on the butter side. You would have to have a 2.5 m -high table to have a full rotation. It's very similar when you use the phone, you have it here with your chest, and then you lose it, and then it lands either on the edge or on the screen, and it cracks or it breaks. We are selling products to elderly people who are getting a little bit slippery.
So what happens, and you know it yourself, you buy a new phone because you are not patient enough to wait for those three hours it takes to repair the glass, or because of the battery. With this product, we have bumpers, we have a special cover, and we have replaceable battery. The bumpers are on each edge, there is a rubber bumper, meaning that when you lose it and if it lands on the edge, it will not break. It has this smart cover that I will come to as next, and that actually you remove the back, the flip side of the phone, and then you click in the smart cover, and it also protects the phone. Then we have two elements of screen protection, and this is a patented solution from emporia.
You can also see that when you close it on the left-hand side here, those translucent bubbles here, they actually change the interface of the phone. Even with a closed cover, you can operate the phone by answering and even a torch and hanging up. It has a function beyond just protecting the phone. That means that we have done something which is quite unique. I think it is the only phone on the market where actually we offer a 12 months display warranty. It costs roughly EUR 150- EUR 200 if you go to a repair shop and replace your broken glass. It has a high value for the customer. That has been when I will come to the media reviews, you will see that most of them are about this feature.
It is a phone that varies quite a lot from a traditional mobile phone. But of course, one thing is the safety, which is two unique factors that I refer to, but it also has some other features. Many people talk about panic button. We call it a no panic button. I will explain that in a moment. It has wireless charging. It also has a SD card for storing photos and other data. Many elderly people, they are not so familiar with storing in the cloud. So actually it has a big memory card to store data. This is the no panic button. It is actually the red one and you can program it. So it is just not that you can program it to call someone, but actually you can use it also for Google Gemini.
That means that you could use program that button to operate the phone over voice control, speaking instead of typing. You can program it as a direct access to whatever you like. When it comes to the user interface, most people have had a smartphone or a feature phone for many years. That means that you are perhaps when you get older, your fingers are getting a bit slower and you have cold fingers and you are not seeing so well anymore, then you want to switch to this kind of device with this on the left-hand side, very few fields that you can press. But one of the fields, this I icon is the info center where actually you get all your WhatsApp messages, SMSs, notifications.
Instead of going into WhatsApp and SMS and all these different applications, you get all of that in the info tile. Then you can easily slide the phone and get what you see on the right-hand side, which is the regular interface from Google, which you also can customize. You can very easily switch between a phone, a regular smartphone, and a phone that has fewer tiles specifically made for elderly people. That transition from having used a smartphone for many years and suddenly because of your age and whatever, you have to have a simpler device you can simply switch between. It's not entirely for elderly people. Then it comes with Android 16 and also with upgrades of the Android system for next five generations.
It has both near-field communication and fingerprint sensor, which means that you can continue to do online banking as you have done with your previous phone and all public services. Today, especially in some markets, without these functions, you are really stuck. It has another important feature for elderly people. It's the Bluetooth 5.4 with the integrated ASHA protocol, which is a standard for hearing devices. It automatically switches via Bluetooth into your hearing device if you use one, and with exceptionally good sound quality. You see there are a lot of functions that are designed for elderly people, and it's not just an ordinary phone, and it's a solution that you can use both as a traditional phone and also for people who have certain needs. When we launched these phones, we had in Germany and in Austria, 57 publications.
We sold out the entire first batch as soon as we got them in. We launched it together with Swisscom, which is known for being the toughest operator in Europe to work with. Sales were so good that we had to ship in another batch that just arrived yesterday, now on Monday in Linz, and then we're continuing to ship out. This different publications reach to 23 million potential readers in Germany and Austria. You see a lot of this is about the uniqueness of having no fear of falling as a person or losing the phone. It comes also with the one-year warranty. A lot about the features I just talked about. A lot of product presentation from me this time. Next time, it will be much more about numbers and how the business is operating.
Thank you, Kjetil. I will wrap it up with two slides because we are almost on time, on the hour. Very excited about the foundation Tommy mentioned. Gro being quite optimistic going into a strong season in Q3. We cannot wait to see the financial output from Kjetil, which we look forward to report in the coming Q3. We are, in fact, building Europe's leading family IoT company. Just wanted to highlight to you our combined annual device sales. Like Tommy mentioned, the foundation in Doro, roughly 1 million. Xplora historically have had half a million. I expect Kjetil to soon get back on track to previous height on roughly 300,000 from emporia. Just please bear in mind, emporia had 240,000 unit last year. They have had limited financial access, so we expect the number to grow eventually back to those number.
But we now see roughly 1.8 million as a base before further growth. Currently, eight active market in Europe, one in U.S., but like I said originally, we do add two new growth engines by adding these two markets eventually that emporia represents. Also now we have, like Knut said, financially huge benefits of having all these hardware platform we can utilize across multiple markets. As we know, more product to sell means more cash in the bank and revenue. For the outlook to end, of course, we will continue. The market is where it is. We know the markets are changing. It is all about us having more product, strong strategies to execute. We will continue to focus on our three main KPIs, gross profit growth, subscription, and EBITDA after CapEx.
Like we mentioned, please pay attention to our sharpening retail model, how this will implicate hopefully both more sales, but a higher conversion rate with SIMs. Emporia will short-term, of course, add revenue. Short-term, it means plus/minus on the EBITDA financial side when you are calculating. We can have discussion about that afterward as well, but it also will helps us add the synergy effect of NOK 50 million reduced OpEx comparing Apple to Apple going into 2027. We stay very firm on the one million path. We are on track, and even though we have been some delays with the senior implementation, we do feel very strongly about the end game of 200,000 subscription when we reach 2029. As Gro said as well, we are also on the path to constantly deliver more than 100,000 net subscription on the kids and youth.
Keep in mind, Gro now also have more product, and we are tapping into this very exciting market with youth as well. I think that basically wraps up bang on 10, and I am pretty sure there are some questions at the end. So Knut, Kjetil, join me on stage. We will have the rest if there are some questions as well. Gro and Tommy. Go ahead, shoot. Let us start online, and then we do the audience afterward. So it seems like device gross margin was quite high this quarter compared to previous quarter. What can we expect going forwards on gross margin device sales?
I can take that one. When it comes to gross margin, we had a very good and strong gross margin this quarter, mainly because of the product mix. So we are still aiming for the +40% gross margin target that we have stated for some time. We will try to keep the overall gross margin at historical levels. We do not see any big change in those going forward.
Okay. This one expected. What is the incentives for Power to load your device with your SIM versus SIM from the other big three in Norway?
Very interesting question. I cannot give any details on this one. We have an agreement, a competitive agreement, so we jointly can address the senior segment. We are confident that the agreements that we have will contribute to our overall goals that we have communicated today.
Like we said originally when we acquired Doro as well, and as we then also calculated, we would be on a competitive level when it comes to those BIFFs. I will translate this from Norwegian on the fly to English. Congrats with a solid second half year. Can you be a little bit more concrete related to why Doro Connect has taken a little bit longer? Now when the pilot is done, is it a full rollout and more stores in Norway now in September? You can just repeat that one as well, Tommy.
Yeah, absolutely. Basically, why it has taken longer, first of all, it is number of things that needs to be put in place, but also cooperation together with the customer. We are not doing this ourselves. We are doing this in a partnership with the customers. We have started to invest in to build a solid ground instead of running too fast. As for the rollout, we are starting to do the rollout in September. We will do that in sequence together with them, and there is more to come on that one.
All right. Back to school discount Gro was a little bit more generous this year compared to last year, although you had uplift in the number. It was not really a question, but can you compare on the discounts in any way?
Yes, it is not really more generous if we look across markets, but maybe the markets that we are well into now. Back to school started in Germany, U.K., and Spain this week. The Nordics is what impacts the numbers so far. We are comfortable with the discounts that we have offered, and we do see both strong numbers, strong volumes, and also strong monetary numbers.
Okay. Customer sentiment seems to be challenging. Any color you would like to add? I can address that quickly. We have been around for some time. Doro has been around for even longer, 50 years, emporia for 30 years. The market for the consumers are up and down. We have had historically now a year-ish with very good sentiments. Even when the market started to decline a little bit, our category, protecting our kids and elderly, kind of got this very late in that period because parents still would like to buy things for the kids. But that is why we have focused on better incentives. We have really utilized our business model, and like we have tried to present today, we have a toolbox full of action that we can use when the market is a little bit softer.
We know it is all about timing because market will again change. The good thing if we are very dedicated and disciplined during time when the market is soft, it basically means when the market is getting better again, we have a foundation with better traction, better margin, and just even a better business case model in general. So when we then start to scale on a better margin, we scale and make even more money. We are used to this.
The market goes up and down. We have a lot of experience in this. We are still making a lot of money. We presented some tools today, and the market will go up and down. It is just how it is. All right. I think that was the main questions. Anyone from the audience? I know we'll see a lot of you guys during today, so I guess we'll be hammered down with question then so we can take it then. If there is anything, please. If not, thank you so much for joining us