AutoStore Aktie

Good morning, and welcome to AutoStore's Q2 2026 update. My name is Hiva Flaskjer, and I'm the Investor Relations Officer at AutoStore. I'll be moderating today's meeting. And I'm joined by our CEO, Mats Hovland Vikse, and our CFO, Paul Harrison. They're standing ready to walk you through this quarter and answer your questions.

As usual, we would like to remind you of our disclaimer in regards to forward-looking statements. It can be read here at your own convenience.

Moving on to our agenda, Mats will begin with an overview of our operational performance and strategic progress. Paul will then present the financial results in detail. We will follow with a live Q&A session, and you can submit your written questions via the webcast player or ask your questions directly via Teams. The link and information are available on our website. After the Q&A session, Mats will round off with some closing remarks. And as a reminder, all financial figures are stated in U.S. dollars. With that, let's get started. Mats, over to you.

Thanks, Hiva, and good morning, and thank you for joining our Q2 update. We've delivered a very strong quarter here with revenues of $192 million and order intake of $218 million. This is a performance that reflects the significant strategic progress that we've made across the business.

In addition to that, we've also continued to see positive market trends. Customers are showing more confidence, and we also see a greater focus on building resilient and flexible supply chain, which is just getting more and more relevant in this current environment. And we're no exception to this ourselves, and you see the benefits of our own strength in supply chain in our continued strong gross margin of 72%. Adjusted EBITDA margin was also very strong at 45%. And then against this backdrop and with improved visibility into our backlog and expected conversion, combined with the fact that we're further into the year, we have today provided full year revenue guidance of around $700 million.

This momentum supports further investment in our commercial, product and technology capabilities. And while these investments are expected to slightly moderate margins in the second half of the year, we remain well positioned to deliver strong profitability while investing for the future.

Overnight, we've also announced our agreement with Amazon. This is an agreement that establishes a global framework for supplying to Amazon. And whilst there are no purchasing commitments at this time, we're very pleased to continue to develop deeper relationships with our strategic customers. Also, we announced a share buyback program today, just reflecting the confidence we have in our business, our strategy and our long-term opportunities. And Paul will share more details on this in a moment.

So let me now walk you through some of the key developments that underpin our confidence in the business and also the opportunity ahead. So 1 year ago, we outlined 3 key priorities. One is to strengthen our product offering. We wanted to deepen engagement with our key customers and building a larger recurring revenue business. We've made progress against all 3 of these commitments.

Looking at product and innovation, we have significantly reduced time to market, launching 14 new products and features over the past 12 months. These innovations have expanded our addressable market through solutions such as AutoCase, while also increasing the value we deliver through software and AI. With close to 100,000 robots deployed across 2,000 installations worldwide, we have access to just billions of data points from live operations. And this proprietary data set is one of our strongest competitive advantages. This is what provides the foundation for an increasingly intelligent software and AI capability that's just compounding with every robot that we deploy and then enabling us to deliver better insights, better optimization and greater value to customers over time.

We've also strengthened customer engagement across the installed base, and we're seeing increasing traction from our land and expand strategy. At the same time, we continue to leverage our partner network to scale efficiently, and we've now sold into 68 different countries. And lastly, we continue to broaden recurring revenue streams with software embedded in every system sold and AutoStore-as-a-Service now providing additional flexibility for our customers.

But I think what is particularly encouraging is that this progress is now increasingly reflected in our key operating metrics. You look at this page, we now have 2,000 sites globally. Order intake was up 36% in the first half and revenues grew 63% in the same period. And importantly, we have achieved this while continuing to invest in future growth. Our total operating expenses have increased as planned as we invest in innovation, our commercial capabilities and in expanding our product portfolio, just further strengthening the platform and our position. And while we're pleased with the progress that we've made, we still believe that we're in the early stages of capturing the opportunity in front of us, and we just continue to see that these strategic priorities are the right focus areas.

Then looking ahead, we see a clear path to sustained profitable growth and long-term value creation. And behind this confidence lie several key pillars. First, we operate in a large and still significantly underpenetrated market. The majority of warehouses globally remain unautomated, and we continue to believe that automation adoption will increase over time. Second, within this attractive market, we believe AutoStore holds a unique competitive position. We have a market-leading technology platform with the largest installed base and a customer value proposition that's characterized by rapid payback.

Third, our go-to-market model allows us to combine this scale with customer intimacy. We continue to deepen engagement with customers directly whilst also leveraging our partners to expand our reach and support our land and expand strategy. And finally, we continue to invest in innovation. We have now expanded our offering through new products, AI software capabilities and solving adjacent use cases, just increasing the number of opportunities where AutoStore can create value for customers, and we won't stand still. But importantly, all of this is then underpinned by attractive profitability, strong cash generation and disciplined capital allocation. And taken together, we believe this provides a clear path to long-term value creation.

And one of the strengths of AutoStore is the diversification of our business. We serve customers across several end markets with no single vertical representing a significant share of revenue. We're also fortunate to work with many leading global companies, just demonstrating the relevance of our solution across a wide range of industries and use cases. And while we've already built a highly diversified business, we still see significant opportunity to deepen our presence across these end markets and expand with both new and existing customers.

And it's always nice to end with a nice customer story. QLS is a good example of how our innovation efforts are translating into customer value. The installation that you're about to see utilizes newer capabilities such as the FlexBins, which is enabling the system to accommodate a wider range of inventory and customer requirements.

So before handing it over to Paul, please have a look at this video.

[Presentation]

Paul?

Thank you, Mats, and good morning, everyone. There's a couple of things to take away from this video. First, the importance of introducing new products that serve a greater variety of customer needs; and second, how in turn, that supports our land and expand strategy. As Mats has said, Q2 was a very strong quarter for AutoStore with record revenue of $192 million and record order intake of $218 million. Profitability remains strong with a gross margin of 72% and an adjusted EBITDA margin of 45%, while cash conversion was 84%, demonstrating the cash-generative nature of our business. We also ended the quarter with an order backlog of $596 million, providing good visibility into future revenues. Overall, we are pleased with the quarter 2 financial performance. And while the project nature of our business means that quarterly progress will not necessarily be linear, the direction of travel and upward trajectory is clear.

Let me now take you through the financial performance in more detail. Looking firstly at order intake, we reached $218 million in the second quarter, a strong number following several strong quarters. I'm happy to report that retail, 3PL and industrial segments all continued to contribute positively and in line with our strategic focus.

Turning to revenue. As I mentioned, we delivered a record revenue of $192 million in the quarter, up 43% year-over-year and 16% sequentially. Looking at the regions, Europe delivered a very strong quarter. North America is slightly down this quarter. However, we are experiencing strong demand in a region where we see significant growth opportunities. Asia Pacific saw stable performance during the quarter. The standard segment delivered steady growth, and we also benefited from a meaningful contribution from high throughput projects in both Europe and North America.

As Mats mentioned a few minutes ago, we're now 6 months behind us this year, and we have stronger visibility into the balance of the year, notwithstanding the project nature of our business. And this has led us today to provide full year revenue guidance of around $700 million.

Let me now turn to profitability. Our gross margin slightly moderated from Q1, and that's consistent with our prior communication, but it remains strong at 72%. This reflects continued operational excellence and the resilience of our business model. As I've said before, we're not immune to input cost movements. However, I would say that we are significantly better positioned today than in previous cycles; a more diversified supplier base, improved sourcing and our standardized product platform provide greater flexibility to help manage raw material cost volatility.

Adjusted EBITDA margin was 45%, up sequentially from 44% in quarter 1. This continues to demonstrate the scalability of the AutoStore business model where revenue growth translates into attractive profitability and cash generation. At the same time, we're now accelerating investments behind future growth opportunities, particularly within product innovation, software and AI as well as commercial capabilities. While this is expected to slightly moderate margins in the second half, we're confident in our ability to balance disciplined investments while continuing to deliver strong profitability. So overall, we believe the quarter demonstrates both the resilience of our business model and our ability to invest for future growth from a position of financial strength.

Turning to the balance sheet and cash flow now. The strong profitability and cash-generative nature of our business model continues to be reflected in our balance sheet. Cash conversion was 84%, supporting both continued investments in the business and the further strengthening of our financial position. Net debt was reduced by $46 million during the quarter, ending at $90 million, corresponding -- which corresponds to a net debt ratio of 0.3x. At the same time, liquidity remains strong with $104 million in cash and a fully available revolving credit facility of $350 million, providing total liquidity of $454 million. This financial strength gives us significant flexibility.

Finally, on capital allocation. At our 2024 Capital Markets Day, we outlined 3 priorities for the deployment of capital, and these priorities remain unchanged today. Our primary focus is to reinvest organically in the business where we see substantial opportunity for growth in what is still a large and underpenetrated market. Second, we continuously evaluate strategic inorganic opportunities, and we'll flexibly invest in those that can accelerate our expansion into adjacent markets and create value for shareholders.

And then finally, any surplus capital will be returned to shareholders. This approach to capital allocation is underpinned and enabled by our strong balance sheet and leverage profile, which we will maintain. So consistent with this framework, today, we've announced a share buyback program of up to $75 million, which we plan to complete over the course of this year. The program reflects our confidence in AutoStore's long-term prospects and cash-generative business model while preserving substantial financial flexibility to continue investing in the business and pursuing our strategic priorities.

So with that, I'll pass back to Hiva, who will manage the Q&A. Thank you.

Thank you, Paul. Please join me, Paul and Mats. Let's see. Let's start with questions from the Teams. [Operator Instructions] Okay. [ Tim ], I believe you are first in line.

So my first question is on the agreement with Amazon. Can you please provide a little bit more details on the agreement? For example, is that the partnership will be only for the new projects for Amazon or it's also with the existing projects? What would the product or solutions be for, the time frame of the projects or the agreements and any minimum purchase amount, for example? Any more color would be helpful.

Yes. Thank you. So this agreement provides a framework in which Amazon can purchase our products and solutions on a global basis. It does not contain any purchasing commitments as such. And beyond that, we can't comment on the details of the agreement as such, and we don't have a practice of commenting on the individual customers.

All right. Understood. No worries. And then my second question is on the guidance. So the full year guidance for revenue is around USD 700 million. And for the first half of the year, we have around $358 million. So that means the second half revenue could be likely flattish compared to the first half. But we have order intake to be growing in the past 2 quarters. Book-to-bill has been above 1. So does that imply the new orders for these 2 quarters, there will be more high throughput projects, which may last for a longer period of time? Can you please provide a little more color on that?

Yes. Thanks, Tim. I'll comment on that. Look, first of all, we are pleased to provide guidance today. That guidance is given following a very strong first half as we reported today. And keep in mind always that this is a project-based business. And in that regard, we still got 5 months of the year to go. So we've got a good part of the year still to go. So as you would expect us to do, our guidance is set on a prudent basis in light of those characteristics.

Understood, very helpful. And then on the margin side, I think the comment is also like there will be more investment in the second half, so margins could probably slightly moderate in the second half versus the first half. Any quantification you can give on how this margin would evolve, that would be great.

Again, I'll cover a couple of points. I mean, first of all, I think these results demonstrate that we apply a very disciplined approach to investment in our business, and we're seeing the clear benefits of that investment, as we talked about in the presentation. And we've consistently said that we will continue to invest where we see opportunities to accelerate growth. So that's the framework with which we think about investment.

That said, we're very proud of the margins that our business delivers and will sustain high margins. So as I say, the words moderate slightly reflect the opportunity to invest further in the business, but you can continue to expect to see strong margins in the second half.

Understood. That's clear. And my final question will be on the current trading status. Can you give a little bit more color on how the order momentum will be into the third quarter? Any change in terms of customer behavior, let's say, in terms of the macro environment?

Yes. Thanks, Tim. So look, as we talked about, we've had significant strategic progress also leading to the results that we've had today and first half has been incredibly strong. On the market overall, we see customers coming in with more confidence. And combining with that, this need to create resilience in a world that is highly volatile is also giving us some good tailwinds from the market. We continue to have very constructive dialogue with both existing and new customers and feel very good about where we are today.

I think, [ Lasse ], you are the next one.

Just a quick follow-up on your outlook for the rest of the year. I mean the kind of the phasing for a weaker H2 kind of goes against your typical seasonality, at least historically. So I'm just wondering if you can give some more detail on whether was there anything in the second quarter that contributed to the very strong growth that should suggest that the next 2 quarters are somewhat weaker? Or are there any kind of special effects that you saw in Q2?

I think the observation about Q2 and H1 generally is it was a very strong period for the business with a number of projects secured in terms of revenue in the period. So as you might expect, with still quite some way to go in 2026 and in light of that very strong performance, of course, we're going to be prudent at this stage in giving our guidance of around $700 million. But one thing to keep in mind, I think, if I may, on the $700 million, that still implies -- that number would still imply 30% growth year-over-year. So it is very much consistent with the comments we've made today. It would reflect a very strong year, we believe.

Okay. Understood. And then just a second question on gross margins. I think in Q2 -- sorry, in Q1, you mentioned we should expect that to sort of start with the 7 for the full year. Q2 was really robust again on margins. So just wondering if you have any updated thoughts there for us in light of aluminum prices still reasonably high. I know you mentioned you're better set up there than you were in the past, but any updated thoughts on the gross margin would be great.

Yes. You're absolutely right to remember what we said at Q1, we expected gross margins to moderate somewhat over the balance of the year, and you've seen that in Q2. But look, based on what we see looking out and given the operational strength that I referred to in the presentation around the management of our cost of sales, then I still expect the gross margin to start with a 7 this year.

Okay. And that's for the full year, right, not just for H2 or?

I expect it to start with the 7 for the full year and H2.

And was there anything from as-a-service in Q2?

Yes. We had a couple of deals in Europe, around about $8 million of total contract value. So that tells you this continues to play an important role in our armory, generating interest from customers, some of which ends up translating to traditional sort of CapEx-based business. But yes, 2 deals in Europe this quarter.

[ Eirik ], you're the next one up.

If I can push you a bit more on the Amazon deal. Could you kind of help us understand if Amazon should be viewed kind of not only as a customer, but also as a kind of partner of sorts? And if so, are they a partner that will only do own integrations? Or will they have the opportunity to offer AutoStore solutions also outside its own kind of usage?

So as I said, the agreement provides a framework that describes how Amazon purchases our products and solutions, but we're not disclosing any details in how that is set up.

Okay. That's fair. But if I could maybe frame it in another way, do any other of your customers have a similar agreement or a similar contract?

So we do have similar agreements out there. And of course, we have announced this because of its significance. Look, if you look at how some of the customer relationships that we've had has developed, we see more and more customers actually taking good ownership of their automation, figuring out how to best utilize it simply because it's becoming so strategically important. And that's a trend that we see across a wide variety of customers out there.

That's great. Also on a different note, Europe continues to be the key driver on revenue. Could you give us any indication of what the geographical mix looks like in the order backlog as of now or the order intake in the quarter? And is that kind of similar to reported revenue in the quarter? Or is the tilt the difference?

I think I made -- I go back to the comment I made in the presentation in that regard, Eirik. I commented that actually we've seen a slight contraction in U.S. revenues, in North American revenues in quarter 2. But my comment was that we still continue to see strong demand from that region. So you can conclude from that, that North America continues to more than pull its weight when it comes to the order intake.

That's very clear. And just one last one. Great to see that you're launching a buyback. Could you share some thoughts on your thinking around kind of both the absolute level of max $75 million? And also if this is something that you potentially see as kind of a stable for your use of cash over the coming years?

Well, delighted to announce that buyback today. And it is, of course, as you know, the first buyback AutoStore has conducted since its IPO. So we've set a goal of up to $75 million for 2026. And of course, as the rest of this year progresses, we look forward to a number of discussions now with shareholders to understand their reaction to that, and that's something we'll share with our Board as we continue to debate the topic. But great to launch this today, Eirik.

[ Tintin ]?

First, on Amazon, another attempt. Can you talk about maybe what you've done with them so far? And then are there specific developments or features that are bespoke to Amazon in sort of kind of your development pipeline? And then shall I do it one at a time or do it all?

Give us both, Tintin.

Yes, I'll go for it. And then in terms of -- somebody already asked the AutoStore-as-a-Service. But just generally, Paul, could you update us where recurring revenues are at now in the business?

So why don't I start? We have already previously many times talked about the fact that there is a relationship and that there is usage of AutoStore. But I'm also afraid that beyond that, I need to reiterate my comment that we do not comment on the terms of the agreement nor on individual customers as such, as is our practice.

And Tintin, on recurring revenues, it's, again, I think, a strong message. And that is that even in a quarter where we've seen very strong revenues, led, as you might expect, by traditional sort of CapEx-based business. Even in that context, we continue to see recurring revenue.

Sorry, Tintin. Look, I was making the point there, I don't know when you lost me. But look, even in a quarter where we've seen very strong business, and of course, much of it, as you'd expect, traditional CapEx-based business, it's great to see that recurring revenues are still a double-digit proportion of our revenue base. So a strong and important contribution from recurring revenues, which include AutoStore-as-a-Service and software, of course.

Yes. Sorry, could I just go back on the second part of my Amazon question, which is, are there specific features and functionality that's specific to Amazon? I know, obviously, it's very much a product business, but just wondered if there's some specific features in the pipe -- either in development or in the pipeline.

Yes. Look, as you say, it is very much a product-driven business, and we take pride in our standardization. But I also need to reiterate that we do not comment on individual customers.

[ Fetel ], you're next one up.

Couple of questions. I'll take one at a time. So I mean, orders are materially up and all-time high. Is it possible to provide some color on the drivers here? I mean, geographical between industries, when it's broad-based or larger orders? And then finally also, is Amazon included here?

Okay. Look, I'll start with that. The order profile does reflect the traditional spread of our business. I made the comment a couple of minutes ago to imply that order momentum is strong in North America, notwithstanding a slight contraction in revenues this quarter. And we've commented as well that it's the standard segment that's been very strong in the period, albeit still high strong contribution from high throughput projects as well. So there are no particularly unique orders driving the order intake number in the period. It's just a strong period.

And my final comment would be that to relate the order intake performance to some of the new product innovation because there's no question that some of our newer products such as AutoCase are unlocking opportunities. And indeed, if you go back to the video we played this morning, you heard the customer talking about FlexBins. So we are seeing these innovations unlock opportunities and drive -- play their part in driving order momentum.

And then probably another question for you. The OpEx is slightly up in the quarter. Is this sales-driven? Or should we expect this level to persist despite guiding lower sales in the second half?

Well, look, when we talk about margins moderating in H2 as we invest in growth opportunities, quite a bit of that is people and quite a bit of that is in commercial. Mats talked in his presentation this morning about increasing customer intimacy. And for strategic customers, that is achieved by having senior experienced salespeople sort of managing those accounts. So yes, an element of the investment we referred to will be manifested in OpEx.

And look, maybe I'll add, Paul. Look, we will continue to invest when we see growth opportunities. And we do see growth opportunities, both on the product side and how we develop the commercial side of the business. I think if you look at what we've achieved over the last year as well, we are showing clear financial return on those investments, and we will continue to take opportunities so that we not only build the opportunity to drive growth today, but also building just a better foundation, a better company so that we're well positioned to take advantage of this massive growth opportunity that we have in front of us.

One final question for me, and I go back to the Amazon deal again. I totally understand that you can't share too much details here. But how do you view this deal, I mean, from the company? Has this closing been a key goal for you for a long time? And how do you see this going forward as well?

Look, as we've talked about before, a key part of our strategy is to build deeper engagement with largest customers out there, what we call the high-potential segment and the elements that we've talked about before. We will continue to focus on that. And if you look at the customer list we have today, there is several high-quality blue-chip names that is using our system across different verticals, across different use cases and doing that with success. And we will continue to invest against having those capabilities to build those deeper relationships because we see that there is such a great land and expand opportunity out there.

[ Martine ], you're next one up.

Congratulations with really good results. I suppose all of my questions are almost answered. But I just think of the -- when you say the moderation in the margins in H2, can you also say something about like your medium-term expectations beyond H2 here?

You know what, we -- I go back to the comments I made about guidance in this still very much project-based business. And we're not guiding beyond the guidance in '26 that we've given today, Martine. So for the moment, I won't comment on that. I would perhaps reiterate Mats' important point, which is that we'll remain very disciplined investors in the business, mindful of the high margins we deliver, but ready to invest in growth opportunities.

That's good. And on the sales part in Q2, since the -- like the full year guidance assumes somewhat like the acceleration of the sales. Can you say something about like any of the -- like the sales coming in being significantly larger this quarter? Does that make sense?

There's nothing abnormal in the pattern this quarter. But together, those sales contributed to a very strong quarter and a very strong half. And of course, as you would hope, that's informed our thinking around guidance where we want to build in some prudence to that guidance. We're still 5 months of the year to go.

Perfect. And last one, on the AutoStore-as-a-Service, you said on the sales revenue side it was approximately $8 million. But in the order intake, was there any AutoStore-as-a-Service there?

No. In the order -- the deals in revenue in the quarter have a TCV of around about $8 million. And so that will play out, of course, over the number of years associated with the deals, but that's the principal update on AutoStore-as-a-Service in the quarter.

So new orders, to be clear.

Yes. Sorry, yes.

The next one is [ Lucas ].

I have two, and just a bit more kind of strategic and longer term. When you think about all the kind of new products and also software kind of updates you launched in the past few years, clearly there's been an acceleration. Are you able to kind of separate in the growth you've seen over the years, how much is related to those additions you've made? Obviously, some of them are pricing. So there's a number for it, but also it's an enabler to more orders. So I'm just trying to see the return on all of kind of those product launch. Are you able to kind of put a number on it a system you wouldn't have sold or the average kind of dollar per system much higher because now you sell robotic picking and you sell kind of other things related to it?

Yes. As Paul mentioned, there is a meaningful portion of orders that we've signed of late that has been enabled by the fact that we've released the products that we have because by releasing those products, we're able to solve different kinds of use cases that we've been able to in the past. And that enables us to sell our full suite of products because we can add that specific capability. So we have that, and we will continue to have those types of innovations.

But importantly, also the investments and the releases that we've had on our core, including software, CubeVerse and AutoStore Intelligence, we're providing our customers with a system that is just constantly improving and where the value of that just compounds with every new robot that we add to the fleet. And that is an important aspect for customers that are making automation investments, not only for this one specific site that they have right in front of them, but they need to build in a model where they have the right long-term partners given how strategic these types of investments are. So overall, it's, a, creating new opportunities and enabling a lot of orders; and b, it's also helping create that long-term confidence in us as the right partner for the future.

And just a quick follow-up also on the point you made on data, which obviously I think is interesting because you have much more systems than kind of anyone else in cubic storage. But -- and when the Router came in, I remember there was a big shift in kind of productivity and how much more you could do with the same system. I guess when you think about new iterations going forward, just with the software itself, how much more you think you can unlock from kind of productivity of the existing installation just from software. And the point is, yes, with the AI, maybe there's more things we can do.

Yes. And you're absolutely right. When we did release that new Router product, we took a leap change in terms of productivity. Since then, that has just continued to be improved every day based on all the data that we're gathering and our ability to take that and use it to improve the system. Now with AutoStore Intelligence and utilizing AI to both configure that on specific sites automatically, but also just to continuously improve it, we still see a lot of opportunity to have that just become increasingly better over time.

And having this notion where you have a standardized machine layer and then smartness on top that enables you to constantly improve and get a better system is what we call intelligent fulfillment, which is a key aspect of how we think at AutoStore.

[ Alore ], you're next one.

It's a bit broader question and not directly related to Amazon, but we have seen that Amazon is opening up their logistics network during the summer. So it would be great to get some color on the response from your 3PL customers and other customers as well. Have you seen any change in behavior following the news?

So overall, 3PL has been a good segment for us because we can, through a standardized product, serve so many different use cases and industries. And as you've seen from our presentation, it's also a meaningful portion of the business we do. And as such, we create good relationships with the 3PLs out there.

[ Tim ], you're next one.

So actually a little bit more on the Amazon deal. With the new partnership, does that reflect going forward there will be like Amazon to buy your systems directly? Or is it still going through this traditional way of going through the distributors? I'm sure you can comment on that.

I'll refer back to the answer that I gave previously on the similar question. It provides a framework in which they can do it, but we're not disclosing details on the contract itself.

Tintin, you have follow-ups?

Just a very easy one and a non-Amazon one. The share buyback up to $75 million, is there a cap on the price?

There are...

Are you buying -- yes?

As you always see with these programs, there are parameters that we -- that the Board has set around the buyback, but we're not disclosing those today, probably obviously, so, Tintin.

So, I believe that concludes the questions from Teams. Let me just double check from the web. No questions there. So I believe that, that concludes today's Q&A session. And with that, I will hand over the word to you, Mats, for your final remarks.

Thanks, Hiva, and thanks for all the questions. So let me just conclude by summarizing a few key messages from today's presentation. We've made significant strategic progress over the past 12 months, and this is increasingly reflected in our financial performance. This quarter, we delivered record high order intake, revenue and backlog, all while maintaining strong profitability. We have, at the same time, increased the scale and pace of our innovation and keep investing against a very attractive road map. And altogether, these results just reinforce our confidence that the strategic priorities that we set out a year ago are the right ones.

The market opportunity remains substantial and is growing. Warehouse automation is underpenetrated, but the trends and the tailwinds are clear. And in this market, we have a leadership position, and we believe AutoStore is well positioned to maintain and grow this position, leaving us well placed to deliver profitable growth and long-term value creation. So we're very excited and motivated to take advantage of that opportunity that we have ahead of us. So thank you for joining us today. We appreciate your continued interest and support and look forward to speaking with you again next quarter.

Good morning, and welcome to AutoStore's Q1 2026 Update. My name is Hiva Flaskjer, and I'm the Investor Relations Officer at AutoStore. I will be moderating today's meeting. I'm joined here today by our CEO, Mats Hovland Vikse; and our CFO, Paul Harrison. We're standing ready to walk you through this quarter and answer your questions.

As usual, we would like to remind you of our disclaimer with regards to forward-looking statements. It can be read here at your own convenience.

Now moving on to our agenda. Mats will begin with an overview of our operational performance and our strategic progress. Paul will then present the financial results in detail. We'll follow with a live Q&A session, and you can submit your questions via the webcast player or ask your questions directly via Teams. The link and information are available on our website. After this Q&A session, Mats will round off with some final remarks. And as a reminder, all financial figures are stated in U.S. dollars.

With that, let's get started. Over to you, Mats.

Thanks, Iva. Good morning, and thank you all for joining our Q1 update. Over the past few months, I've spent quite a bit of time with customers across Europe and North America. And what I hear is broadly consistent and constructive. First of all, it is clear that we live in a world which is incredibly hard to predict, and all businesses need to assume that this will just continue. Against such a world, I'm hearing that it's more important than ever to build an end-to-end supply chain that has the resiliency and flexibility to thrive in a world of uncertainty.

Supply chain is a strategically important area for all companies moving goods, and it's just getting more important with this backdrop, which is also reflected in those conversations. What we bring to market, which is market-leading robotics and software and how we are doing that with our refreshed strategy, i.e., moving closer to customers with a high pace of innovation, resonates well with how these businesses are thinking, and that's also showing through in our results and what we're bringing to market. If we look into our numbers, we are reporting a good start to the year today. Revenue came in at a solid $166 million with an order intake of $179 million. Profitability remained strong with a 73% gross margin and an adjusted EBITDA margin of 44%. Cash flow conversion was 82%, which really underlines the strength and cash-generating nature of our business model.

Moving on to the business overview. In March, we had our spring product announcement. This one was primarily focused on the launch of our new software platform as well as new and exciting AI capabilities. I'll come more back to this in detail later. First, taking a step back, AutoStore holds a clear position as the global leader in a market that is still in its early years. Our scale is unmatched. And as of Q1, we have almost 90,000 robots across nearly 2,000 installations. Central to our success is our land and expand strategy. And in Q1, we saw 55% of revenue coming from existing customers who are either expanding their existing sites or establishing new ones. In the quarter, we also added 25 new customers, bringing the total to more than 1,300.

As we've talked about before, our commercial strategy is focused on building deeper relationships with strategic customers, and these numbers here reflects the importance of that. If you then look to the right side of this page, you'll see that our financial profile is highly scalable with industry-leading profitability and cash generation. This slide here shows our broad customer portfolio across a diverse set of end markets. In the quarter, momentum remained strong, and we saw continued positive development across several segments, including retail, 3PL and industrial, and we saw an increased demand for our high throughput solutions.

Now a year ago, we presented our product strategy, which is structured around 4 clearly defined pillars. Since then, we've delivered 3 separate product announcements, each directly advancing these initiatives across these pillars. Most recently, we announced our core software platform and AI capabilities, which is just further strengthening our product offering and the value proposition to our customers. I'm very pleased with the progress that we've made and the consistent execution against the strategy that we communicated a year ago. These milestones here demonstrate our ability to rapidly translate strategic priorities and customer feedback into tangible product outcomes and value for our customers. And the product that we have released and the direction that we're on has been very well received by our customers and the community overall. Not only are we seeing good initial traction, but it's also clear that we have increased our addressable market by now being able to help our customers address new types of use cases.

So with that, let's now dive into our spring announcement where AI, cloud and data were in focus. In this release, we announced CubeVerse, AutoStore Intelligence and VersaAI. CubeVerse is our new unified cloud and data platform that connects all of our applications, our AI capabilities and integrations into a single ecosystem. Embedded in this, AutoStore Intelligence acts as an AI layer that uses proprietary models to optimize operations, predict issues and deliver measurable performance improvements for our customers. This is a significant step forward. We now have the platform and AI layer to turn decades of data into intelligence that just compounds with every new robot that we deploy. This is delivering real-time insights, actions and continuous improvements for every customer at every site.

And let me remind you that we have almost 90,000 robots deployed at almost 2,000 installations across the world, which is just giving us billions of data points from live operations. No other player in our segment has this insight. So if you take a step back, our world-class hardware amplified by software platform and AI, creates this compounding competitive advantage, one that just deepens with every deployment and widens with every customer. This is what we call intelligent fulfillment.

So now before I hand over to Paul, let me show you a short video that talks to this.

[Presentation]

Thank you, Mats, and good morning. It's really exciting to see our product road map unfolding. Data and insight are what truly sets AutoStore apart. And now with insight driven by these AI capabilities, our value proposition becomes better, and our competitive advantage is stronger than ever before.

Now let's move to the financial highlights on the next slide. Q1 reflects a strong start to the year and continued momentum since Q2 2025. Of course, we are mindful of the turbulent world we live in. But as Mats has noted, it does see customers strengthening their supply chains, and that is where we play an important role. Also, our sharpened operational focus drives revenue and order intake in key segments as well as stable, high margins. I would add that as you look at these numbers, the impact of movements in FX on both sequential and year-over-year growth across key metrics is not material.

And before we move to the next page, let me remind you about the natural quarterly variations we see in our business. However, if you step back and look at the trend line, you'll see that we're clearly on a good growth trajectory. Looking at order intake, we reached $179 million in the first quarter, which is a solid number following a very strong quarter 4. And what is positive in our new commercial model is that we are securing longer-term commitments. What that means is that the order intake we see now includes projects scheduled for 2027 shipments. I'm happy to see that retail, 3PL and industrial all contribute positively. And with that, our order backlog closed at $571 million, another record high.

Moving on to revenue. Revenue was $166 million in quarter 1, showing very significant year-over-year growth. Looking at the geos, Europe once again remained solid, whilst North America delivered strong growth, 25% in this quarter. It was also pleasing to see a positive performance from Asia Pacific. The standard segment delivered steady growth, and we also had a meaningful share of high throughput projects landing in Q1 from both Europe and North America.

Okay. Let's move to margins. Gross margin came in at 73%, which reflects strong operational discipline. At the same time, we're not immune to the price increases we're seeing across various input costs. And these will weigh somewhat on gross margins over the course of the year. But with the resilience we've built into our supply chain, I do not envisage this having a significant impact on that high gross margin. Similarly, our EBITDA margin was stable and strong quarter-on-quarter at 44%, a reflection of our efficient business model and investments in long-term growth initiatives.

Finally, let's have a look at our balance sheet and financial position. In quarter 1, we continued to generate strong operating cash flow with a conversion rate of 82%. Working capital increased mainly due to a rise in receivables, reflecting higher volumes and some normal seasonality. Investment activity remains stable with the majority related to new product development. And as a result, net debt decreased to $136 million at the end of Q1 compared to $180 million at the end of Q4 '25. That corresponds to a net debt ratio of 0.5x, reflecting a very strong balance sheet.

So with that, I'll pass back to Hiva, who's going to lead the Q&A.

Thank you, Paul. And as always, as usual, let's start with the questions from Teams. [Operator Instructions ]. And let's see who has raised their hands. I believe, Luke, you are first in line.

I've just got a couple of questions. The first is on aluminum prices, which I know have risen significantly over the last 12 months. Can you just give us an idea when you say that there might be some impact on gross margin, but some mitigation from your supply chain, can you give us some quantification around the impact given some of the historic impacts that we've seen have been relatively significant? And then as a derivative of that, are you considering raising prices to your customers to help mitigate against those rises?

And then the second thing is, just can you give a bit more color on the conflict in the Middle East and how that's impacting either demand or supply chain management through March and April?

Thanks, Luke. I'll start with a couple of comments there. Yes, we are seeing a significant increase in aluminum costs. And as I say, that will have a bearing on our gross profit for the balance of the year. But we have spent a lot of time really since the Russian-Ukraine situation, diversifying our supplier base, which gives us the opportunity to take advantage of competitive dynamics that exist across our procurement activities. So when I -- if you want to frame this as I look, based on what we know today at the balance of the year, we still expect our gross margin to start with a 7. That hopefully gives you some quantification.

Mats will maybe comment on prices. Just a quick comment on the Middle East. We do a relatively small amount of business in the Middle East, but I will say that, that business continues to be delivered. So modest impact on our overall P&L, but no significant disruption to orders that we have in that region.

Luke, maybe first to add on your first question, Luke. We have learned a lot since we were in a similar situation a couple of years ago. And based on those learnings, we've taken some very clear actions on the operations side of the business, diversifying our supplier base, how we work with them, what type of agreements we have in place, et cetera, et cetera. So based on what we're seeing now, we don't see a need to pass this on to customers because we're able to, at least with the current visibility, have pretty limited impact, as Paul was saying.

But as we've done before, we have tools in our toolbox, should this reach a level where we see the need to do so. But that's just something that we'll observe and follow as we move forward. If you think about the situation more holistically on what's happening in Middle East and the disruptions that's causing globally, I think when we speak to customers, I think they're operating with this mindset that there is uncertainty. There will be unexpected things happening globally. And more important than ever, you need to build that robust supply chain and robust operation that can handle these different shocks. So I think we're in a period of time where customers are living through those types of situations and trying to build resiliency to handle it even better in the future. But of course, it impacts prices, it impacts the consumer, et cetera, et cetera.

That's great. And just to be clear, there's no significant surcharges expected on the pricing side from what you're saying.

Not with the visibility we have today.

I believe, Eirik, you're next one up.

Eirik from DNB Carnegie here. Three from me. I guess first one is for Paul and just kind of housekeeping on the FX impact, particularly on orders because you don't think -- I think, explicitly disclose that in the report. We calculate ballpark 8% to 12% organic growth adjusted for FX tailwind. Is that kind of ballpark in the right range on orders?

Order intake actually on a constant currency basis is slightly above reported, Eirik. But across the key metrics, revenue is absolutely disclosed, as you see in the quarter 1 report, it really isn't significant to these overall growth numbers we're talking about.

Okay. That's clear. My second question is on capital allocation and kind of in light of the numbers presented today. Any updated thoughts here on the buyback potential? You're at 0.5x net interest-bearing debt to EBITDA given what sounds to be a decent rest of the year. How should we think about the potential for a bit more active capital allocation?

Look, it is, as you say, it's a strong balance sheet, and we talked before about our priorities, organic potential for M&A to complement our strategy. And yes, we take and consider at a Board level returns of cash to shareholders and continue to do that. So something the Board debates. Something [indiscernible].

Okay. That's fair. And then lastly, can we get an updated number on the share of recurring revenue? And also kind of how we should think about this number in light of some of the new product launches you've made over the last 6 months or so?

So around about early to mid-teens and proportion of our revenue base is recurring or reoccurring in nature, that includes spare parts and around about half of that relates to kind of software and AutoStore-as-a-Service, Eirik.

Okay, perfect.

What we have released and what we are releasing, you're right, kind of more and more value sits in the software and the AI that we're applying across that portfolio. As you remember, we also released the Essentials Package early in the year where we're providing kind of a nice commercialization wrapper for all those innovations. So it's clearly a focus for us to, a, bring value to customers through that part of our product portfolio and, b, to then monetize that using that Essentials wrapper, which is over time building a better recurring revenue into the business.

That's great color. And if I can follow up on just briefly on that. I guess that's kind of opt-in for the end customers if they want that Essential Package or not. Can you give any indication of kind of the uptake or the penetration of the Essential Package or other opt-in software solutions kind of beyond the router software?

So the Essential Package follows as a standard into the new sites that we sell. And as you know, you need to operate with our core software and that portfolio to have it operating. If you look at those additional software applications that we can offer on top of that, which is kind of CubeAnalytics and some of those products there, we are seeing very strong uptick, both on the new sites that we're selling, but also existing customers are adding those applications into their portfolio. So I'm very happy with the development we've had there in the last 12 to 18 months.

I believe, Tintin, you're next one.

First one, are you able to share more about the success in North America? So color on is that existing new customers, any changes in win rates? Any notable changes in the competitive landscape there?

And then secondly, on -- just an update on AutoStore-as-a-Service, 3PL clearly still remaining strong. What's happening with the proposition there? Clearly, Q1 last year, it felt like a lot of people were interested in it. Is it to do with the macro environment? Just give us a color where you're at with that?

Maybe I'll start and you can chime in, Paul. But very happy to see the performance that we've had in North America because you'll remember earlier in 2025, we talked about reallocating resource into the region because we are seeing such a strong growth opportunity there. If you look into the numbers, it is a mix as it is globally. We're seeing the existing clients we have coming in and buying new sites as well as extending existing sites. And there, we are seeing different momentum in those discussions because of the new commercial model that we have applied where we are deepening those relationships and having different types of discussion now than what we've had in the past.

On the new logo acquisition, we're also progressing quite well also on the -- both on the order intake and revenue side, but also if you look into some of the leading indicators across the pipeline, we're having a fairly good traction in terms of new logo acquisition. The competitive environment in the region is roughly the same as we see globally, which is largely unchanged versus how we've talked about it in the past, and we're seeing that our win rates remains very, very strong.

Yes. And then AutoStore-as-a-Service, Tintin, one deal concluded in quarter 1, around about $5 million in Europe. So that tells you that this remains very much a feature of our business, appealing as you implied there are to certain -- sort of certain key verticals, an important tool, therefore, in our lockers, so we continue to offer it. We continue to have a number of interesting conversations with potential customers about it.

I believe, Martine, you're next.

Congratulations for really good results. I think a lot of my questions got answered, but I have some as well. And I can take them one by one. You have -- you further increased the order backlog conversion rate. How do you see the trend developing to 2026? Was there any like in the sales space, was there any like larger orders affecting that?

I think it's returned to broadly the historic average when you look at recent quarters. I wouldn't point to sort of anticipating a sharp increase in it as we look for the rest of the year. And just as I mentioned in my comments, just keep in mind that we, of course, start now to take in deals for 2027 into the backlog as well as you think about that conversion. But good to see it back up to that historic average.

I think more kind of broadly, we're seeing now customers making commitments, following through on those commitments and having kind of a normal sense of urgency against that. So no special things impacting conversion as such. There will always be a lumpiness in those numbers because of the business model we have. And that's a fundamental feature of our model, and that should also be expected as we move forward. But overall, I think there is kind of a natural good conversion rate, which is something that we focus on coming back to when you now look at the numbers.

That's good. And on the gross margins, you answered the aluminum part, but was there anything other particular affecting like in the product mix that we should be aware of?

Yes. Look, my comment was not intended actually to be confined to aluminum, and we're mindful of the potential for a broad increase in input prices and energy costs. And take my comment, please, when I was presenting the slide as covering a broader sort of take on input costs than just aluminum.

Got it. And a little bit follow-up on Tintin's questions regarding the split on the order intake. Would you say that this -- the region split on sales reflect on the order intake split? And was there any like significant larger order this quarter that we should be aware of in the order intake?

I think we talked, if you go back to quarter 4 about a number of sort of long-standing high throughput debates coming to conclusion in terms of order intake. We didn't see that same feature in quarter 1. So no, I wouldn't point to anything sort of abnormal in the quarter 1 order intake.

Martin, I think, you're next one.

It's Martin from Citi. So the question is just coming back to North America. So obviously, there's a lot of movement on tariffs. And just trying to work out whether the new tariff situation is better for you than perhaps people might have feared a year or so ago. I mean obviously, there are these new Section 232 tariffs, which presumably impacts the aluminum grid that you sell into North America, but just trying to understand what the impact is there. But overall, are your customers now feeling that tariff certainty is now resolved and that's sort of releasing pent-up demand that might have been sort of on hold from last year?

We don't see the tariffs itself limiting conversion as such. So I think that in itself gives an answer to part of your question. If you look at the recent changes, we're seeing that. Yes, some mix shifts in [ better ] but not meaningfully changing the position, and that position is one where I think customers has now gotten used to a world where you operate with a tariff level and across the value chain, you solve for that and drive towards conversion. So no, I don't see that meaningfully impact our ability to do business in North America and the customer seems to have adjusted.

And if I could just have a follow-up unrelatedly, one of the features that seems to be seen in the industry at the moment is this desire for flexibility and scalability just because of end market uncertainty. And obviously, you've got a very flexible solution. I don't know the way you measure this if it's sort of number of robots per order or just simply size of individual orders. But are you seeing more customers wanting to sort of start small with an option as part of your land and expand to sort of upgrade relatively quickly? Or is that not really a feature that we should be sort of thinking about?

Look, even historically, that has been a feature of how our customers are implementing AutoStore because there is no need to try to look into the crystal ball and guess what your volumes is going to be 5 years down the line and scale your system based upon that, you do actually build for the demand that you're seeing today and kind of what you have in front of you and then you scale over time.

So I think looking at the numbers, it will be even clearer once you start seeing extensions come in, in future years. But it's clearly a big topic as we discuss with those customers because you're trying to solve for a situation where you should expect your business to look different 1, 2, 3 years down the line. And that's also how we're designing those systems and designing those conversations that we're having.

Tim, I think, you're the next one up.

So the first one is about your AI capability, you just seem to detailed. And I just want to get like a brief idea how much more value proposition that AI can help in terms of like your order size? I mean if I look at the historical number of the order value is probably like [ $2 million, $3 million ] on average. And how much AI can help in terms of boosting this number in terms of the value that we can get from the platform?

And also if you develop the AI capabilities, are you develop all these things in-house? Or do you consider partnering with some of the third-party solutions, which can further enhance your capability on that?

I think an important feature with AutoStore Intelligence that is that we're applying those proprietary models across the portfolio. So we're creating customer value in different ways. Two of the areas that we highlighted in the spring product release was one in the CubeControl software, which is kind of the routing software and the logic that drives efficiency.

And by creating those customized configurations through AI based on those real individual site situations, we have seen quite meaningful performance increase on sites that has high throughput, high robot density where kind of that optimization challenge is the hardest. And as that creates customer value, of course, over time, that will also show through in our ability to monetize that.

The second example that we got through was through CubeAnalytics, where we're now able to move from just providing data to actually providing insights and predictability and telling the customer what to do with what the data is telling you. So again, as we provide more customer value, that will over time improve our ability to monetize and improve those metrics that you just mentioned, Tim.

And when you look at partnerships, we are building proprietary models in-house, and it's important for us to have those capabilities. But of course, there's a lot of exciting things happening out there. So we are building the right sets of partnerships as well. For instance, across AutoStore Intelligence, we have partnered with Databricks to make sure that we're able to bring the best of breed out there. And on VersaAI, we've also built partnerships to make sure that we're applying the right set of AI and the right vision systems to those products so that we bring the best possible solutions out there to the customers.

Got it. Very helpful. And my next question is about your go-to-market model. I think you have been increasing your resources or input into the sales force or like -- to get closer to the end users. And I think that's probably one of the reasons why you have like an improvement in terms of the conversion, in terms of revenue from the order backlog. How do we think about the further inputs this year or going forward? Are we going to increase more resources in terms of sales, in terms of, let's say, the capability to try to enhance further conversion -- that means if there's any implication in terms of margin on that front?

So look, we have made some targeted good investments, both in our commercial part of the organization and in our product part of the organization against that strategy that we've talked about. As you say, those investments have yielded good returns for us. And as we see those investments also producing a good business case going forward, we will continue to make those investments because it's giving us the results that we're able to present here.

Next one up is Petter, I think.

Yes, sure. Two questions from me. You have discussed the geopolitical uncertainty and I obviously understand that, that creates some uncertainty. But have you observed any, call it, tangible shift in consumer behavior in recent weeks? Are they becoming slightly more cautious? Or is it more or less business as usual? That's my first one.

So in terms of our customer base, we haven't seen any meaningful shift over the past few weeks in the discussions that we've been. Downstream, how the consumer acts for those different types of businesses, I think there's better people than ourselves to answer. But from our perspective, those discussions has not changed.

Okay. Perfect. And then on OpEx, we have seen some volatility over the last quarters, and it's definitely good to see that costs are moving down now Q-over-Q. So on a broader picture, if you look in Q1, I think the clean cost base are up around 8% year-over-year. Is that a good estimate for the full year? Or is Q1 not, call it, fully representative?

I think if we go back to Q4, I talked about some of the features of the OpEx we reported in Q4 with sort of year-end -- a very strong year-end reflecting in sort of various aspects of our cost base, including compensation. And I said then that we would see it come down in Q1 as it has done. As we look forward for the rest of this year, clearly, the usual cycle in our year, which is in Q2, we'll do the usual salary rounds, et cetera. So that will have -- I'd anticipate some impact on OpEx. And then just back to Mats' point, we're not going to hesitate to bring more resource into the business if we see clear growth opportunities. So I'm not going to encourage you to simply take quarter 1 and extrapolate from that for those reasons.

Okay, two things we're balancing as a business is, one, this is a market that is still just in the early years, and we're very early on the overall adoption curve. And if we can make investments that enable us to, a, maintain the leader in which is going to drive that adoption and, b, help accelerate adoption, we will do that because of the early stage that this market is in.

But of course, on top of that and what we're balancing it against is this disciplined approach of making sure that we do the right investments because it is a scarce resource, and we need to make sure that we're making investments that is yielding results and keeping that cost discipline that has created the strong financial profile that we present here today.

Toby, I believe, you're next one up.

Maybe just on the margin side, thanks for the steer on the gross margin dynamics. So still sort of expecting that to start with the [ 7 ]. But if the input costs continue to weigh on the gross margin through the year, as you mentioned, how should we think about the flow-through to EBITDA margin? And what do you see as any sort of key offsetting factors across the OpEx that could allow the EBITDA margin to remain more stable or even improve even if the gross margin trends down a little bit through the year?

Look, I think we -- if you step back from this, we have always seen some variability in our gross margin linked to things like product mix. So I don't think we're in a particularly -- as we look at it right now, a particularly abnormal situation to my earlier comments. And to Mats' comments, we will obviously take gross margin trends into account in the running of the business. But at the same time, they will not -- within the parameters I've set out, they will not see us refrain from putting in the right investment into the business either. So I think just to step back here, I think given the parameters we're talking about at the moment, we're in a kind of normal -- a reasonably normal sort of business situation.

If no other hands, let me just double check. No other hands are raised. As far as I can see, I will check the chat as well. There are no questions. So I believe this concludes today's Q&A session.

And I'll hand over the word to you, Mats, for some closing remarks.

Thanks, Hiva. Thanks, Paul. So let me just summarize what we presented to you today and remind you also of some key points.

First, we operate in a large underpenetrated market that is supported by long-term structural trends. We have remained focused on executing on our strategy with sharpened commercial focus, improved backlog conversion, and we've maintained solid profitability. And while the environment in early 2026 remains broadly in line with last year, we're in a much stronger position than what we were a year ago. We have a solid foundation supported by a scalable solution that goes across industries and geographies.

And with a more customer-centric go-to-market model, we're working closer with customers and just strengthening our land and expand strategy. This also contributes to us being resilient and well positioned to manage the current geopolitical uncertainty with corresponding volatile market conditions while also protecting our profitability. And as you've heard me say many times before, we're not standing still.

During the past 18 months, we launched 18 new products and capabilities that's just seen us extending the Cube into adjacent workflows, solving real customer challenges and expanding our addressable market and AI capabilities. As Paul has demonstrated, our highly cash-generative business model results in a strong balance sheet. Taken together, these characteristics give us the confidence in our direction and ability to create long-term value.

So I'd like to thank you for dialing in today and look forward to speaking to you again soon.

Good morning, and welcome to AutoStore's Fourth Quarter 2025 Presentation. My name is Hiva Flaskjer, and I'm the Investor Relations Officer at AutoStore. I'll be moderating today's session. I'm joined by our CEO, Mats Hovland Vikse; and our CFO, Paul Harrison, and they're standing ready to walk you through this quarter and answer your questions.

As usual, we would like to remind you of our disclaimer with regards to forward-looking statements. It can be read here at your own convenience.

Moving on to the agenda. Mats will begin with an overview of our operational performance and strategic progress. Paul will then walk you through the financial results in more detail. We'll follow with a live Q&A session [Operator Instructions]. So after the Q&A, Mats will round off with some final remarks. And as a reminder, all our figures are stated in U.S. dollars.

So with that, Mats, over to you.

Thank you, Hiva. So fourth quarter marked a strong finish to the year. Look, we can all agree that 2025 has been a volatile year, but it is now clear that the actions that we have taken are starting to show through in our results.

In Q4, revenues grew 29% sequentially and 9% year-over-year to $180 million. Order intake increased 27% sequentially and 35% year-over-year to $194 million. Moving to profitability. We maintained our strong gross margins at 74% and our EBITDA margin ended at 43%. If we look at it through a full year lens, revenues ended at $539 million, down 10% compared to 2024.

And as we stand here today, we still observe a market that holds a lot of the same characteristics as we've seen for a while. What we see though is that certain customers are now investing in automation and building that intelligent fulfillment platform that is needed to operate in a world where changes just happen at a pace and frequency like never before. The customers we signed in Q4 are a mix between those that we've worked with for a long time and new ones that has come in with higher velocity.

In the quarter, we saw continued strength from industrials and other B2B segments, and we're also seeing some traction in retail. I'm also pleased to see that U.S. constituted more than 30% of our order intake. And in addition, we had several high throughput projects converted in the period. As we've talked about before, these are key growth areas for us, and the U.S. was one of the areas where we reallocated investment towards during 2025.

Taking a step back, 2025 has been a year where we've made significant change and progress in the company. The market environment was very difficult at the start of the year as also reflected in our results. Following that, we took decisive actions and focus on what we can control.

First, we have improved our ability to win, getting closer to our customers, reallocating resources and making sure that we're focused on the right sets of opportunities. We've added 150 new customers in 2025. And what is interesting, though, is that still existing customers accounted for about 60% of our revenues. And this to me talks about the potential of our land and expand model and the importance of deepened customer relationships.

Second is that we're taking steps to improve the quality of our revenue. We have continued to invest in and monetize our software products, such as the Essentials Package that we released earlier in '25. Additionally, we've launched new business models with AutoStore-as-a-Service to better align with certain customer segments. And as an example, earlier this year, we won and shipped projects worth $34 million, and all of this has now gone live and started generating revenues for us.

And third is that we continue to expand our leadership position through an improved pace of innovation. In 2025, we released 11 new products, including AutoCase, CarouselAI and Flexbins. And so far, we've seen strong commercial traction with very positive customer feedback, and we've now gotten involved in several projects that we otherwise would not have been able to do without these sets of capabilities. We do not stand still. Our next product announcement is coming up already in March, and I'm looking forward to showing you the progress that we've made.

But altogether, these 3 pillars are setting us up for growth. As mentioned, there is still uncertainty in the market. And even though we see good momentum on several fronts, it's still too early to call how 2026 will evolve. But what we do know is that we are entering 2026 in a stronger position as a company than ever before. And that is partly as a result of the strong foundation that this strategy is built upon.

The scale we have with nearly 2,000 systems across 65 countries gives us a true global presence. We've achieved that through a model that gives us industry-leading distribution with a strong partner network and a broad customer base of 1,300 customers. We do all this with a superior financial profile. We're set up for growth, high margins and high cash conversion. And look, we can achieve this scale with such a financial profile because we have a standardized, modular and flexible solution that works across a wide range of end markets.

There's 2 takeaways I want you to take home from this page. First, we have a diversified customer base with customers using our solution for many different strategies: B2B, B2C, e-com, store fulfillment and much more. Second, our solution is trusted by world-class brands. And even with those that have started implementing AutoStore, it is still early days in terms of adoption.

I always like to end with the customer story. And this time, we want to show our customer Polaris, who is a global supplier of outdoor and off-road vehicles. They have seen great benefit of incorporating AutoStore into their operations. So before Paul takes us through the financials of the quarter, please have a look at this.

[Presentation]

Thank you, Mats, and good morning. That was a great example of a customer requiring an AutoStore solution, which would fall into our standard segment, which clearly delivered strong improvements across their key metrics.

Now let's move on to the financial highlights on the next slide. Over the course of 2025, we saw a gradual stabilization of market conditions. So for the year, revenue came in at $539 million. Gross margin was 72% and adjusted EBITDA margin was 42%. Order intake reached $638 million and cash conversion was 76%.

But turning to Q4, in particular, our performance was enhanced by a number of customers committing to projects that they have been evaluating for some time. The results also reflect strong operational focus, and we're seeing the early results indeed from our sharpened strategy. As a result, revenue came in at $180 million, up 29% quarter-on-quarter and 9% year-over-year. Gross margin was 74% and adjusted EBITDA margin was 43%. Order intake reached $194 million, bringing our backlog to $557 million, and cash conversion for the quarter was 84%.

In Q4, as Mats mentioned, the strong order intake you see on this slide reflects growth across a broad range of end markets with retail showing renewed momentum. In addition and reflecting back to our Capital Markets Day in 2024, it's good to see progress in our high throughput space.

Order intake reached $194 million, which took our closing backlog to a record high of $557 million.

If I move now to revenue, sequentially, revenue grew 29% to $180 million in quarter 4. Europe remains strong, and North America also delivered another quarter of sequential progress. The standard segment delivered steady growth, and we also had a meaningful share of high-throughput projects landing in Q4 from both Europe and North America. So I'm pleased with the sequential improvements in order intake and revenues and the year-on-year growth of 35% and 9%, respectively.

As you consider the year-on-year growth, remember, please, our comments about the unusual euro-U.S. dollar movements in Q4 of last year. If you adjust for those, the 35% and 9% I just referred to become mid-teens and single-digit growth numbers, respectively.

Okay. Let's move on to margins. Gross margin came in at a particularly high 74%, reflecting a favorable product mix. Further down the P&L, the adjusted EBITDA margin came in at 43%, which is lower than the previous quarter. Now as we've said on a number of occasions, we're prepared to invest in growth, and you should expect us to continue to do this, balancing profitability with disciplined investment.

This is a new slide, which we're presenting following the completion of the recent refinancing. As a reminder, we refinanced on the 5th November 2025 with $150 million 5-year term loan and a $350 million 5-year RCF. We continue to deliver strong underlying cash flow from operations with cash flow conversion at 84% in Q4, as I mentioned. Looking at the quarter in more detail, we see a high tax outflow of $48.4 million. This is primarily driven by the timing of tax payments in 2025 with the final true-up being finalized in the fourth quarter.

And looking at working capital, we had an increase in receivables affecting free cash flow in Q4 as part of a normal seasonal pattern and a reflection of a large volume of sales booked in December. All of this took our net debt to $180 million at 31st of December, and our liquidity headroom remains strong at $372 million, split between cash of $90 million and the undrawn elements of the RCF at $282 million.

Going forward, our new facilities will enable more agile and efficient treasury management with surplus cash being more readily applied to debt repayment without any loss of financial capacity. During 2025 as a whole, we continue to deleverage our balance sheet and our current net debt equals 0.8x adjusted EBITDA. As we talked about before, growth, both organic and inorganic, remains our highest priority. However, with these leverage levels and strong cash generation, capital allocation is a topic the Board regularly discusses.

So with that, I'll pass back to Hiva.

Let's open up for some Q&A. And let's start with the ones on the webcast who are joining us on Teams, sorry. Eirik, I think I believe you're first. If you could please go ahead and unmute yourself.

I had a bit of a struggle getting on to the start of the webcast. So apologies if these were addressed early. But if we can start just with some housekeeping, Paul, on the exact FX impact on both orders and revenue. Is it correct to think that FX tailwind was approximately 15% year-over-year on orders and approximately 5% year-over-year on revenue?

Yes, you're in the right place there, Eirik. So to be precise, constant currency revenue growth around about 4%, constant currency order intake growth around about 14%.

Perfect. And also, Mats, I think I picked up on the comment you said that the U.S. was it more than 30% of orders in Q4? How was the order growth distributed between the other geographies? And could you also give some more color on high throughput versus standard in the quarter?

Of course, and you got that right. So U.S., more than 30% of orders. Europe remains strong north of 60% and remaining landing in APAC and some in Latin America. High throughput was also an area where we did make progress in the quarter, both on order intake and in revenue. So a few high throughput projects included in the mix there for sure.

Perfect. And I guess this is back to Paul. Your order book to revenue conversion was around 33% in the quarter, quite a meaningful step-up from both Q2 and Q3. How should we think about your ability to drive orders to revenue for the full year of '26? And are there also other factors such as as-a-service or longer project time lines for high throughput that we should take into account?

Yes. Look, I think it's obviously good to see that 33% conversion in Q4. It takes us back, if I take a long-term historic average to near that average and is better than the conversion rates we saw in quarter 1 to quarter 3, Eirik. I would just remind you that the comment we made about a number of those high throughput projects coming to fruition in quarter 4. So we need to be a little cautious about whether we see a sort of repeat of that conversion rate. What I will say to you is that the quality of our order backlog remains extremely strong.

Perfect. And while I'm still on, I'll go with a couple of more, and that's on the kind of demand side. Are you seeing any impact at all of like pull forward demand due to customers kind of front-running price hikes on memory chips and/or potential supply chain constraints, which has been a theme over the last couple of weeks?

No. I think in general, what we're seeing with customers is that many are now looking to implement automation because it has a meaningful difference for them in their operations. We haven't seen any meaningful difference because of either shortages or price hikes, et cetera. For our customers, I think this is more of a long-term investment that sees them building better operations versus accelerating it.

That's very clear. And just one which also is kind of on timing effects and the U.S. in particular. Are you seeing any impacts or just in the discussions you have with end customers around impact from the Big Beautiful Bill and potentially pulling forward some 2027, '28 projects to 2026?

No, I think in general, because we are now closer to our customers, we are discussing more road maps and longer-term implementations with it. It isn't, again, driven by kind of certain policies or certain supply chain expectations, but more on a long-term strategy basis.

Perfect. And then one last one, if I can bug you. Last -- less than a year ago, you initiated a cost program with about $10 million in annual savings. Today, you're writing that margins come down, reflecting investments in long-term growth initiatives. Can you share a bit more of your thinking here? And is this kind of a read that you've become incrementally not significantly more positive on short-term outlook over the last couple of months?

I'll make a couple of comments there, Eirik. Look, one thing that we were really pleased to do in 2025, we see quite a material proportion of our cost base move to what I call sort of front office functions. So I'm thinking about the commercial function and products. So we saw that mix shift, which is important. And to that end, recognizing that we remain inherently a highly profitable business with a highly standardized product driving a high gross margin, we will -- and we will continue to report a strong EBITDA margin. But within that range, we will invest, as you imply there to drive stronger growth. That's always been our priority.

And if you look at it, right, yes, we took out those costs, which was needed at the time. But we've also sharpened our strategy, and we see that strategy is yielding results. At the core of it, we're a growth business. As we see business cases or areas that we can invest in that will yield positive results for us both short-term and long-term, we will make those investments.

I think next up is Tim. If you could please go ahead and unmute yourself.

So a couple of questions have already been asked by Eirik. So I will just follow-up with some of the questions. So first of all, regarding revenue conversion in the quarter, obviously, this is a kind of step-up. Can I also just confirm whether there will be any projects that you originally scheduled in the first quarter and then it was delivered early in the fourth quarter?

I think there's always, Tim, a desire on the part of customers to close a year, place orders as part of sort of preparing for projects in the coming year. So there's always a year-end push. In that regard, I wouldn't characterize it as being abnormal, but I would draw your attention again to those high throughput projects that we've been working on for some time that came to a conclusion in the form of an order in Q4.

Understood. And then on the high throughput projects you mentioned, can I confirm how long in terms of project longevity cover the normal project for the projects that you got in the fourth quarter?

Tim, I'm sorry, just repeat that question. I'm so sorry.

Yes. So I'm just wondering how long we should consider in terms of project life for the high throughput projects that you got in the fourth quarter.

So I think the high throughput projects in the fourth quarter is likely to convert over the course of 2026. But on average, these projects do take longer time than what we see in the standard segment because it is larger projects, more complexity and project duration is generally longer.

Understood. That's clear. And then my last question is on the margin side. So I think this quarter, we have a margin decline on a year-on-year and quarter-on-quarter basis as I think that's the growth initiative investments. And if I look at the personnel expenses, it is kind of a step-up in the quarter. Can I just confirm whether there will be any one-off incentives in the staff expenses? Or we should consider this like an ongoing level?

You're right to identify that increase has been sort of related to personnel expenses. Of course, it's -- it becomes headcount investment in, as I say, those front office functions, particularly sales. And of course, as you get to a strong close of the year, the usual sort of accruals for sales bonuses and the likes are relevant as well.

So that means there could be some one-off items included in the staff expenses or not?

No, I'd say the item -- no, not one-off items. I'd say the items that you're seeing are partly related to the performance for the quarter and partly related to broader investment in the form of headcount into the commercial and product functions.

Understood. And then for this level of margin, can I assume it is something like a new norm level in terms of the EBITDA margin?

I think it's -- look, it's important to say we're not guiding specifically to margin today. But we are prepared with those dynamics. I talked about the inherent high profitability in the business. We are prepared to invest to return this business to growth. And let's be very clear, that is our #1 priority. But we are going to remain a highly profitable business. And these margins are still after all 43% in the period.

Toby, I believe you're next.

Just on the investments in longer-term growth initiatives, could you just unpack what are the biggest buckets of spend there? And just how you're thinking about this level of spend intensity going forward would be great.

So look, 2 big areas. One is that we're executing a strategy that sees us come -- coming closer to our customers. So building up the types of capabilities that sees us building those relationships and delivering that value to customers, both pre and post sales because that sees us better taking out the land and expand potential that we've talked about.

The second area is around product. We've talked about the product strategy that we have in place and how that is both improving our current position and sees us entering new types of markets. And you'll see us continue that pace of innovation that we've had in 2025 with new product releases coming up now already in March.

And in terms of go forward, as I said, our mentality is that if we can develop good solid business cases, we will make those investments.

Thank you, Toby. Nicolas, do you -- any question? No question there. No hands are raised now, I think. Well, sorry, Eirik, I apologize. Your hand is raised. Please go ahead and unmute yourself.

Just jumping back into your point about the solid gross margins. Paul, two questions on that note. Number one, on the cost side. Aluminum prices have been kind of steadily rising over the last couple of months. Could you just remind us on the contract structure and also hedging policy and when that potentially might impact the P&L? So that's on the cost side of the gross margin.

And maybe more a question for Mats on the revenue side and on the competitive landscape. Any updates there, what you've seen through the quarter, pricing dynamics, anything that we should be aware of for both the short-term and medium-term?

Thanks, Eirik. I'll go first. Look, on the cost side, clearly, we are able to plan production several months forward, meaning we've got at any point in time, several months' worth of work in progress or finished goods in the form of robots in our factories. So that tends to create a lag effect in terms of exposure to commodity price movements. But -- and I will also point out that having moved away from single source providers, we can take advantage of still competitive tension that exists when procuring those raw materials.

At the same time, as I've said before, we're not immune. Of course, we're not immune to those commodity prices, which is why you -- I've characterized for various reasons, the 74% gross margin in quarter 4 has been a particularly high one. And you've seen variability as a result of the fact that you're raising as a result of product sales mix as well, and that will continue.

And in terms of pricing dynamics, we see that our competitive situations remains very similar as it has been for a while now with the same type of players. What we do see though is that because we are getting closer to customers, we can be kind of even more crisp in explaining the value to those customers.

And the second point I'll make is that because of those product releases that we've had during 2025, we're also now competing in projects that we haven't been able to compete in before. But looking at the data, we maintain our very, very high win rates.

Thank you, Eirik. Petter, I believe you had your hand up.

Yes. I'm not sure if you can hear me. I had some trouble getting into the call. But I do have a question on the cost base. It might also have been answered, but nevertheless, I'll go. Is the cost base in Q4 representative for the coming quarters?

I think I will refer back to the answer I gave earlier. We will, at all times, take account of opportunities to accelerate revenue and that will see variability in our cost base. So we're not specifically guiding to the cost base. What I will also say, again, repeat is the inherent profitability, high levels of profitability in the gross margin level and an EBITDA margin level will continue to prevail, but we will be agile.

Okay. Paul. If I might, just giving a follow-up question on that one. Does that mean that it gives you a little flexibility in a quarter which you could see some softer sales, you have some flexibility on the cost side. How should we view that one?

Look, to some extent, a substantial portion of our cost base is people, of course. So flexibility in terms of hiring plans, yes, we do have. But at the same time, with substantial sort of a employee base in the business. So be mindful of that as well. But clearly, on hiring plans, we can accelerate hiring plans where we see opportunity to accelerate growth consistent with Mats' early observations about strategies, including getting much closer to our largest customers.

Well, actually, Petter, if you have any additional questions, please go ahead. There are no other hands raised. So please go ahead and unmute yourself, Petter.

My question has been answered.

Okay. And you are -- there are no other questions as far as I can see in the Teams meeting. I'll just quickly have a look if we've received any questions on the chat. We have one question from [ Simon ]. What does the management evaluate to be the best capital allocation for the future? And what are other key points for future growth?

Okay. I'll certainly take the first of those. Best capital allocation, and I want to stress again, the best capital allocation is to support growth in the business, both organic and inorganic. But clearly, when you're a business that is strongly cash generative as AutoStore with such a strong balance sheet as well, there is also the opportunity, which the Board considers from time to time to return cash from shareholders. And those 3 elements are not mutually exclusive. So that is an active debate that the Board has.

And I'll repeat the headlines of what we've already discussed. We're executing against a sharpened go-to-market strategy that sees us getting closer to customers. We're investing in key product initiatives that sees us both strengthening existing solution, expanding that into new areas and new problems to be solved for our customers, increasing addressable market and also building a software platform that sees us and our customers draw advantages from all of those other key strategic areas.

Thank you, Mats. That was the only question in the chat. [Operator Instructions] No. I think that concludes our Q&A session for today. Thank you. I'll hand over the word to you, Mats.

Thank you. So let me summarize what we have presented to you today and also remind you of some key points. First, we operate in a large underpenetrated market supported by long-term structural trends.

Second, 2025 was a volatile year, but we responded decisively. We've streamlined the organization, sharpened our commercial focus, improved backlog conversion and maintained solid profitability. And while the environment in early 2026 remains broadly in line with last year, we are in a much stronger position than what we were a year ago.

We have a solid foundation supported by a scalable solution across industries and geographies. And with a more customer-centric go-to-market model, we're working closer with customers and just strengthening our overall land and expand strategy.

And as you've heard me say many times before, we're not standing still. In 2025, we launched 11 new products that saw us extending the cube into adjacent workflows, solving real customer challenges and expanding our addressable market. Our upcoming biannual launch in March will build on this momentum, and we look forward to share in a months' time. So taken together, these elements gives us confidence in our direction and the ability to create long-term value.

So I'd like to thank you for dialing in today and look forward to speaking to you again soon.

Good morning, and welcome to AutoStore's Third Quarter 2025 Presentation. My name is Hiva Flaskjer, and I'm the Investor Relations Officer at AutoStore. Our CEO, Mats Hovland Vikse; and our CFO, Paul Harrison, are standing ready to talk to you about this quarter and subsequently answer your questions. I'll be moderating today's session.

As usual, we would like to remind you of our disclaimer with regards to forward-looking statements. It can be read here at your own convenience.

Now moving on to our agenda. Mats will begin with an overview of our operational performance and strategic progress, including some exciting insights into this fall's product announcement. Paul will then present the financial results in detail. We'll follow with a live Q&A session, and you can submit written questions via the webcast player or raise your hand in the Microsoft Teams to ask your questions directly.

The link to the Teams meeting is available on our website and the invitation published about a week ago. After the Q&A, Mats will round off with some final remarks.

And as a reminder, all financial figures are stated in U.S. dollars.

So with that, let's get started. Mats, over to you.

Thank you, Hiva, and good morning. When we met in August, we noted a more stable market environment compared to the peak uncertainty earlier this year. That stability was maintained into Q3 where the positive backlog conversion trend continued. And what we're experiencing here is a market that is still impacted by the global uncertainties, but where customers are making more progress with their plans. In this market, our strategy of becoming closer to customers is yielding results. More than half of revenues was generated from existing customers also this quarter. At the same time, we signed up around 50 new customers, further strengthening the land and expand opportunity. Europe continues to be a stronghold for us, representing more than 70% of revenues in the quarter, but we also see positive momentum in the U.S., which is expected to be an important growth market for us over time.

Moving on to the financials. Q3 revenue was $139 million, up 4% sequentially, showing steady development from Q2, but still down 4% year-over-year. Order intake was $152 million, which is stable sequentially and up 6% year-over-year. Looking at profitability, gross margin was 73%, which is consistent with levels that we've seen over the past year, whilst our adjusted EBITDA margin came in at 47%, again, in line with historical levels. And Paul will provide more details on the financials later.

But now let me touch on some exciting key developments in the business this quarter. We had our fall product announcement where we announced 7 new products and features designed to improve our overall value proposition, make deployments of the systems easier and expanding on our capabilities. And these were all built in close collaboration with customers to solve real operational challenges and open up new use cases, and I'll come back to the highlights in a moment.

Also, building on our successful experience with our grocery customer, Rohlik, we have signed Veloq as a partner. Veloq, which is part of the Rohlik Group, is a new AI-driven global solutions provider for grocery. Together, we're able to offer an end-to-end solution for the grocery market, which is one of many end markets where we have an attractive value proposition.

This familiar slide illustrates the strong foundations of our business and why we're uniquely positioned to lead. It highlights our value proposition, our competitive strengths and financial profile. To date, we've delivered around 1,850 systems with 82,500 robots across 63 countries, serving 1,250 unique customers.

Within Cubic Storage, no other player has an install base of this scale, which is a clear advantage that just reinforces the strength of our solution and provides us with a substantial platform for our land and expand strategy.

And this is a slide that you're also familiar with. And here are the names of a small selection of our over 1,250 customers. And as you can see, we have a broad customer portfolio across a diverse set of end markets. Around half of our revenues come from existing customers, and this growing customer base represents a massive opportunity. It's also worth noting that Europe remains our largest region, representing over 2/3 of our business. And over the past few quarters, B2B segments like industrials and health care have remained resilient. We've also seen strength in 3PL and leading indicators are improving across e-commerce and retail.

And now in October, we had our fall product announcement, introducing 7 new products and features. These products have been very well received by our customers, and there's particularly 2 of the products that I would like to call out. First is AutoCase, which unlocks the combination of case and piece handling in one automated flow. This opens up a new market and new use cases that we couldn't previously offer to our customers.

The second is FlexBins, and this enables mixed bin sizes within a single grid, which then increases storage density and offer more flexibility to our customers. And these customer-led innovation shows good progress on our overall product strategy. We continue to improve on our core, which is further strengthening our leading position. And we're also expanding our capabilities and solving for new use cases, which then expands our overall market opportunity.

And I always like to end with a customer story. And this time, it's an existing customer who started with a high throughput system a few years ago. Since then, Alza has added several extensions and recently, they just expanded their site again. Next year, they will install their second site, which is a great example of our land and expand strategy and how repeat purchases typically follow once the value is proven.

So before Paul takes us through the financials of this quarter, please have a look at this.

[Presentation]

Thank you, Mats, and good morning. It's great to see a practical example of the land and expand strategy.

Okay. Let's move to the financial highlights on the next slide. As Mats mentioned earlier, this quarter reflects steady progress. This slide gives a snapshot of our Q3 financials. Revenue came in at $139 million. Gross margin was strong at 73%, and our adjusted EBITDA margin was 47%. Order intake reached $152 million, bringing our backlog to $543 million.

And on the next slide, I'll go into more details on these key financials. So as I just mentioned, order intake totaled $152 million this quarter. There was no material FX impact on sequential growth this quarter. However, compared to prior year, constant currency order intake was down 6%. Approximately 55% of orders came from existing customers. And as Mats mentioned, we added around 50 new customers during the quarter. We closed the quarter with a backlog of $543 million, which is up 3% sequentially. Sequentially, revenue grew 4% to $139 million in quarter 3. Europe continued to be strong, particularly in the standard segment, but growth in this quarter was primarily driven by North America. I would add that there were no new AutoStore-as-a-Service deals signed this quarter, but that interest remains strong. And we continue to see AutoStore-as-a-Service as an important way to access projects and customers that might otherwise be out of reach.

Okay. Let's move on to margins. Our gross margin held steady at 73%, which compared to 74% in the same period last year. Sequentially, margins improved, though it's worth remembering that Q2 included the B1 robot write-down. As Mats mentioned earlier, this quarter's margin is in line with the average level for the year.

Further down the P&L, our adjusted EBITDA margin was stable at 47%, reflecting continued organizational discipline. And finally, if I move on to cash flow and net debt, we delivered strong operating cash flow of $73 million, which is a reflection of the highly cash-generative business model and also favorable working capital timing this particular quarter. Total liquidity ended at $498 million, which includes $348 million of cash and $150 million of available headroom under our revolving credit facility. Our refinancing has been completed this current quarter following a successful syndication process. Going forward, this will enable more agile and efficient treasury management with surplus cash being more readily applied to debt repayment without any loss of financial capacity. So with that, I'll now pass back to Hiva, who's going to open up for the Q&A.

Thank you, Paul. Thank you, Mats. Let's do it as we usually do it, open up for questions from our participants on teams. So please go ahead -- so let's see if I can get it right. There we go. I believe, Eirik, you are first up. If you could please go ahead and unmute yourself.

Can you please try to unmute yourself again, Eirik? Okay. Eirik, maybe you can try to unmute yourself. If not, we can continue with the next one, and you can ask your question later on.

Olav, can you try to unmute yourself?

Can you hear me?

Yes. Fantastic.

So first one for me. I mean, the backlog conversion is still below historical levels, even though you've had some internal focus on improving this. I just want to hear your thoughts on what's holding it back? How much of the gap would you attribute to internal factors? How much is the market? And what do you see must be needed for this backlog conversion to normalize going forward?

As we've talked about for a long while, we have seen a lengthened conversion cycle in our backlog. It's very encouraging to see that it has improved of late, which is a result of customers moving more ahead with their plans. Internally, our capacity remains very strong, so we can deliver quickly as customers want to turn quickly and get these systems up and running. So it has been market-driven for a while, but we're seeing positive conversion trends.

All right. And then just last one for me, just to clarify. Is there any revenue in today's figures coming from the as-a-service projects?

No. So neither of the as-a-service projects that we announced in Q1 and Q2 have gone live yet. So no revenue recognized in respect of AutoStore-as-a-Service in this period.

Thank you, Olav. Moving on. Let's try again, Eirik. Can you try to unmute yourself? No, then I think we'll try with Tore. Tore, can you please go ahead and unmute yourself?

Yes. Just 2, if I may. First one would be, we hear quite some positive commentary from warehouse automation players, for example, Kion or some of the U.S. players. How do I bridge the gap to you still declining organically? And when would you see this turning around?

Look, as we've mentioned, we have seen a more stable market environment now compared to first quarter. And we're kind of happy with that conversion -- positive conversion trend that we've seen. Order intake has been strong now for a couple of quarters, and we're seeing positivity in leading indicators. However, this is still a market that is impacted by those global uncertainties, and that's the world that we live in.

Okay. Understood. And then the second one would be, could you just speak a little bit more about the different customer groups? We now had some positive trends coming, for example, from 3PL players. How does this affect you as of now?

Yes. So B2B segments like industrial, health care, et cetera, has stayed resilient and been quite stable for us. Of course, the leading indicators of the business, we've seen e-commerce retail or more consumer-oriented segments starting to see growth, which is positive. And 3PLs for us has continued to be quite strong. For us, that's a very attractive segment, particularly also with the as-a-service model because both technically and commercially, we can offer a system that offers one, flexibility, but also two, a standard set of technology that works for such a broad types of customers and end markets. So for us, 3PLs has been strong and our conversations with the 3PL players remains very positive.

Thank you, Tore. Moving on to Giolio.

You mentioned in the release that the volume and quality of proposals and dialogues remain constructive. So could you give us a sense of what that looks like in practice and what you're hearing from customers regarding their spending plans?

Yes. So as we've talked about already, there is some positive trends across some very, very attractive end markets. Europe continues to be strong, but we're also seeing growth momentum in the U.S. As we look further up the funnel, we see that the pipeline intake, i.e., new customers coming to us showing interest and the amount of pitches that is made across our network, i.e., the amount of offers that is being issued across those different markets sees a positive trend.

Thank you. Tim?

So I have 3, if I can. So the first one is about the market development. As you mentioned, there has been some positive developments in some of the end markets. Can you also elaborate a bit more about how the sequential development in terms of, let's say, customer activities or order intake into the fourth quarter? Any trends that you can highlight when we go into the last quarter of the year? And related to that, I think last year, you gave a full year guidance in terms of revenue in the last quarter -- I mean, in the [ third ] quarter call last year for the full year guidance. So this time, it seems like you are not giving like a full year guidance. So is there any reason for that? That's the first question.

Okay. I'll pick up on the guidance question, Tim. We haven't given guidance for quite some time, not least because, as Mats has mentioned, we still see elevated levels of market uncertainty. It's something we keep under review. But hopefully, in the KPIs and numbers we give, we do give plenty of sort of indicators of the go-forward performance. But no, we don't give guidance with no plans to do so for the time being, but we'll keep it under review.

And then for the first part of your question, we're still early in the quarter. But as we mentioned, we're observing and experiencing more stable market conditions now than what we did earlier in the year.

Understood. And my second question and the third question probably both going to Paul. So Industrial working capital, you also mentioned there has been some positive timing effects in the quarter. So how should we think about the development of working capital going forward?

Yes. Look, there's 2 elements to this, Tim. I think, first of all, it's good to see inventories fall from $94 million to $90 million from quarter 2 to quarter 3. So strong inventory control that we've seen in this quarter. And then really on the working capital, it's the receivables that is making the biggest contribution. And really, that's mainly timing. Our standard terms are 30 or 60 days depending on where the customer is. Nothing's changed there. We've just got a favorable timing impact this quarter and good to see it, of course.

Understood. And final one, I see there was a small impairment amount of $0.5 million in the quarter, not really a big amount, but just want to know about the nature of this. Is this also related to the B1 robot that you made the inventory adjustment last quarter?

No, there are no further impairments to the B1 robot. And then actually, when you look at the adjusting items, Tim, there is next to nothing in the way of adjusting items deriving from EBITDA to adjusted EBITDA. It's just a small amount for stock comp. So really nothing of any significance to report this quarter.

Thank you, Tim. Now let's try again, Eirik.

Sorry, I had some technical issues the first time around. Three questions from me. I'll take them one at a time. And if we can start with the new products. I think that the AutoCase looks really exciting in terms of opening up a new part of the total addressable market. Just for our understanding, it's doable to retrofit this on existing installations, right? And kind of how complex is that process?

Yes, you're absolutely right. It is possible to retrofit into existing installations, and it's also not a very complicated piece of effort. You can either add a small piece of grid and insert the machine into that or you can retrofit into existing.

Okay. Perfect. And also, I assume the answer is no, but will the new products launched have any kind of meaningful impact on gross margins? And if so, kind of which direction? And lastly, when do you expect these innovations to kind of contribute meaningfully to order intake and/or revenue?

You're correct. It will not have a meaningful impact on gross margin. And initially, what we've seen is that this is creating real customer demand already from the get-go. One is that we're able to play in a piece of the market or types of projects that we haven't been able to in the past because we're able to offer case handling and this real omnichannel fulfillment capability. And also we see that customers are liking a lot of the, call it, smaller features that we announced as well, which typically will be part of every deployment that we do, for instance, how it's easier with floor remediation and easier to deploy the systems.

That's great color. And my final question is around the Veloq partnership agreement and kind of multiple subquestions there. I'm thinking about factors such as how far they've come in terms of adding external customers, if you guys will be the sole ASRS provider, how actively are you working in collaboration with them when you approach potential projects? And then, of course, lastly, if it's natural for Veloq to kind of take over the -- what seems to be a partnership link between Rohlik and Amazon in Germany.

So look, we're excited about the partnership with Veloq because the combination of what we can offer and the AI-driven software and solutions that they've built on top provides that part of the market with a real end-to-end capability. And as we've talked about before, grocery is in its early days of both e-com adoption, but also building out the necessary infrastructure to truly support that in a profitable way and in a way that meets consumer demand. But it's still early days in the partnership. We are the sole provider of ASRS in that partnership and excited to see what opportunities that will unlock over time.

Martin, you're next up.

It's Martin from Citi. Just a couple of questions. The first one was just on tariffs. I think previously, you said that obviously, it's your customer that pays them rather than you. But obviously, there has been some change with Section 232 over the last few months. Has that changed anything in terms of order profiles or demand profiles from North America? Or is it so far not really impacting the business at all?

So as you've seen from the numbers and also our commentary, we are seeing some positive momentum in the U.S. And what's been important is that we can provide a level of predictability for customers in terms of what tariffs will be. I think the way we are -- where we are in this market now is that there is, of course, an expectations of tariff. We found a good way of operating that together with ourselves, our partners and the end customers and able to provide that needed predictability, as I talked about.

That's helpful. And if I could just have a second question. We're hearing a lot about robotics and automation companies generally adopting AI at the edge to really optimize, whether it's vision and quality, whether it's routing and picking and these kind of things. Could you perhaps give us some indications to what extent you can build that into your offering, whether it's to make the robots more efficient in routing or elsewhere? Is that an incremental driver to see even more efficiency as they adopt software into how the system is used?

Definitely. And it is a key priority with ourselves as well. And if you look at the product strategy that we've talked about before, building that software platform that goes across all of our solutions, utilizing the opportunity that this vast data set that we have offers is something that we are focused on. So we will continue to announce new set of products and new features on a biannual basis also going forward. And of course, building that software platform, leveraging AI to drive up performance and offer new sets of capabilities is a key aspect of that.

Håkon, you’re next up.

Håkon Fuglu, SEB here. I was just wondering if you could elaborate a bit more on the sort of underlying soft numbers that we're seeing in EMEA right now.

Well, I think, first of all, EMEA, as I said in the presentation, remains really the bedrock of our business, in particular, in what we call the standard segment. Our business, as we've said before, will remain somewhat lumpy quarter-on-quarter. This quarter, Europe is stable, still over 70% of the business. And the U.S., as Mats has noted, is actually what's leading growth. But I wouldn't advise you to read too much into one particular quarter. Our EMEA business remains extremely strong.

And I have another one as well. If you sort of look into your backlog and what will sort of lead sales in U.S. dollars into 2026, what sort of verticals are you seeing going to be contributing most to that growth in '26?

So as we talked about, B2B segments remain stable and strong, but we're seeing positive signals on leading indicators across retail and, call it, consumer-oriented e-commerce-driven end markets as well. 3PLs remain strong.

Thank you, Håkon. Tintin, I think you're next.

A couple of questions from me. In the U.S., could you talk about maybe high throughput versus standard in terms of kind of the performance you've seen? And then secondly, just a general question about competition and other types of light ASRS solutions. In this period, obviously, the challenging period and the broadly more stable environment that you're seeing, is there any palpable change in terms of investor appetite in terms of Robotic Cube versus other types of solutions? And if you feel that your proposition has gotten stronger or weaker in this kind of period?

Absolutely. So if I'll start with the first one, what we've seen over a long period of time is that the average size of the systems are larger in U.S. than what they're in Europe. And that trend, we continue to see and we expect to see going forward as well. So on average, more presence of high throughput than standard in U.S. versus, for instance, Europe.

On your second question, we haven't seen any meaningful change. Our win rates remains very, very high, and we feel strongly about our leading position today, but also very excited about this product road map and product strategy that we're executing against so that we continue to strengthen that leadership.

Can I be greedy and just chuck in one more, finally? In terms of the new products, just trying to put it in terms of kind of relative opportunity versus the core systems in my head, sort of kind of obviously, new products introduced in October. Obviously, there was a whole bunch of new products that were also introduced around April. How should we think about it relative to the value of a system in terms of kind of what the potential uplift is from these new products?

So our product strategy remains -- or consists of several elements. One is that we continue to strengthen our core, i.e., we make sure that the Cube continues to improve so that we can maintain that leadership position that we have.

Secondly, we're also working on expanding the capabilities of that cube so that we can sell that into new types of situations like we can with CaseNow, which opens up a new market for us. So even though kind of the typical deal size remains the same, we're able to sell that into new sets of markets.

Thirdly, we're also looking at adjacencies either through partnerships, organic developments or even acquisitions if the right opportunities should come across, which again broadens our addressable market. The Carousel AI product is a good example of that.

And then lastly, the software platform that unifies all of this and takes advantage of things such as AI, as we just talked about. So in total, it's a combination of making our product more competitive, being used in new sets of markets and also expanding into new markets.

If I can add just one thought. The other aspect to the releases that you saw in Mats's slide is there's a couple of quite critical enablers that really apply to any deployment. I think the floor leveling and more refined sort of fire retardant protection apply to all customers. So some of them really are enablers that cut across all deployments as well, Tintin.

Thanks guys. Thank you, Tintin. I actually believe that, that rounds off the team's Q&As. I'll move on to questions that we've received on the webcast player.

So one is from Atle. Could you comment on the demand specifically from public and government clients in general? Is this a customer group that is late in the adoption process for automation? There are 3 questions. So I'll read.

One by one.

Yes. Do you want to go one by one?

Sure. So public and government sector. So it has been a segment where we've sold into different types of subsegments. We've done libraries. We're doing defense sector. We've even done the archiving system for FBI in the U.S. So this is a sector that we also work in. Overall, on an aggregate basis, I will say that government, public customers are probably lower on the adoption curve than the market in general.

And the second question from Atle is, could you comment on the demand from the defense sector?

So we have continued to do business in the defense sector, both in Europe and the U.S., and we've also done some in APAC.

And the third is online shopping has grown over the years. There is potential that the use of AI agents will greatly improve the shopping experience for customers. In turn, this may lead to a step change in growth in online shopping and online share of total retail sale. Such a backdrop could be very beneficial for demand for AutoStore system. Do you agree? And if so, are you seeing such a trend already?

Yes, I do. Look, as e-commerce volumes grow, the fulfillment challenge becomes even bigger, and you need automation to handle that volume and handle that volume in a way that you meet the consumer expectations around speed, precision, et cetera. So what we've seen historically is that as e-commerce volume and that the share of retail handled over that e-commerce channel increase, the demand for automation follows. And that's one of those long-term growth drivers for this market. As we talked about, we have seen some positive trends in our leading indicators, but it's still early.

Thank you, Mats. I do have some more written questions. So I have a few from Martine from Nordea. You increased your order backlog conversion. How do you expect this trend to continue into Q4 and 2026? That's one.

The second is, can you say anything about the regional split in order intake and amount of larger versus smaller orders?

Third, gross -- strong gross margin adjusting for write-down, should we expect more write-downs going forward? That's the third.

And how is the dialogue with customers in the U.S. now? And I believe we've touched upon the third one.

Grocery market is the fifth. How do you see the development and the competitive situation?

There's a few there. I'll kick off, Martine. I think, look, backlog conversion, Mats said it earlier, we're pleased to see the improved backlog conversion. We're not today, as I've said already, providing forward guidance either into Q4 or next year, but it is clearly good to see that improved backlog conversion. It's good to see customers returning to considering projects. And it's good to observe, we shouldn't forget the still highly underpenetrated market that we address. So stepping back, the backdrop remains very good for growth going into the future, but no specific comments on Q4 or indeed 2026 yet.

I think the regional split of orders is not materially different from the revenue split of orders. It reflects the sort of pattern of our business. No particular comments there. Gross margin, no, I do not expect, as I stand here, more write-downs. The B1 matter was discrete and contained as you've seen in our numbers to Q2.

I think the last one was around grocery market. Look, the grocery e-commerce market and related automation infrastructure is still in the early innings of growth. For us, we feel very strongly about our competitive position. Our value proposition in grocery is very strong as it is in also many, many other end markets.

Just a couple of more. So we have one now. In discussions with potential clients, are you seeing an effect of wage levels increasing across North America and the EU? This surely helps the ROI calculation on a relative basis.

Yes, labor cost and also labor availability is key components into the business case for our customers. And we see that business case continues -- that, that business case continues to be very, very strong, and we're seeing our customers achieve paybacks of as little as 1 to 3 years as they make these investments.

And the final one is, can you comment anything on the ongoing discussions or signs of renewed interest from Amazon?

Look, as we have confirmed before, we have a good relationship, but we can't really comment on individual customer relationships.

Thank you, Mats. I think that actually concludes the written questions. We've answered -- we have answered all. So with that, we have no more questions, and I'll pass the word back to you, Mats.

Thank you. So let me summarize what we have presented to you today and also remind you of some key points. First, we operate in a large underpenetrated market fueled by long-term megatrends. The growth opportunity is intact, and we have a winning proven solution. During 2025, we have responded forcefully to the current market conditions by taking decisive actions, securing high profitability and strengthening our competitive position. I'm confident that we're in a stronger position now than 1 year ago with regard to our foundation for long-term growth and resilience. We have multiple ways to win and a scalable solution that works across industries, system types and geographies, all delivered through a very efficient go-to-market model.

And as you've heard me say many times before, we are not standing still. Innovation is embedded in AutoStore's DNA, and we continue to push the boundaries of what is possible. Today, we gave you some insights into our latest innovations, which are solving concrete problems and immediately creating value for our customers. And we will continue our biannual announcement cycle, continue to move forward. Taken all together, these elements give us the confidence in our direction and ability to create long-term value. So I would like to thank you for dialing in today and look forward to speaking to you again soon.