CellaVision Aktie

Welcome to CellaVision Q2 report 2026.

[Operator Instructions]

Now I will hand the conference over to CEO, Steve Ferguson. Please go ahead.

Good morning, everyone, and thank you for joining us today. My name is Steve Ferguson, and with me is our Chief Financial Officer, Monica Jonsson. We appreciate you taking the time to join us this morning as we present CellaVision's results for the second quarter of 2026. Following the presentation, both Monica and I will be happy to take questions.

As this is my first quarterly earnings call since joining CellaVision as CEO on June 5. I'd also like to take a moment just to very briefly introduce myself. Before joining CellaVision, I spent more than 25 years in international leadership roles across the life science diagnostics and health care industries. Most recently, I was serving CEO of Medix Biochemica in Finland, following senior commercial and operational leadership positions at Thermo Fisher Scientific or Phadia in Uppsala, and prior to that with Lundbeck based in Valby, Copenhagen. I'm really super excited to be part of CellaVision and to the challenge ahead, and I look forward to working together with our very talented team, our partners and all of you as we continue to build on the company's strong foundation to advance laboratory workflow, and diagnostic certainty through intelligent microscopy. I'm speaking to you this morning from Vancouver, where it's 2:00 a.m., so I'll do my best to keep our energy high during this call.

So with that, please let's turn to our second quarter results. So CellaVision's second quarter represents a solid performance and recovery from the slower start to the year. The quarter resulted in net sales of SEK 200 million, an increase of 4.5% over quarter 2, 2025. Sales increased organically by 5.6%, where we saw a 1.1% headwind in currency and EBITDA for the period amounted to SEK 55 million, which corresponds to 27% EBITDA margin. EBITDA for the second quarter was charged with expenses of SEK 9 million associated with the initial cost of the CEO transition. Adjusted for these expenses, EBITDA increased compared to the same quarter last year. As we highlighted in the report, Americas reached an all-time high sales, fueled by large instruments, and this was driven by the accelerated workflow uptake among midsized and large laboratory networks. EMEA showed a sizable -- showed a stable result, but was still slightly affected by the now concluded inventory adjustment from our main distributor partner.

And finally, in APAC, we maintained a steady development through -- though market conditions remain challenging, particularly in China. We see a notable uptake of the reagent business in both Japan and Australia along with a tender win for the UN, United Nations. The commercial launch of our Bone Marrow Aspirate application or BMA in EMEA marks an important milestone in our expansion into specialized microscopy. Initial customer interest and sales have been encouraging, reinforcing our confidence in this market opportunity and demonstrating our ability to translate our innovation, and our R&D investments into commercial results. We continue to progress outside of Europe with the FDA registration process for bone marrow with our aim of obtaining 510(k) clearance in the U.S. before year-end.

And finally, the development of the FPM technology continues to progress through our development phases, forming the foundation of our next-generation hematology analyzers. And this strengthens our confidence in FPM as a platform technology for future innovation beyond hematology. These are exciting developments for CellaVision. And right now, let me hand over to Monica to present an overview of the financial development during quarter 2 2026.

Thanks. Let's unpack the P&L and cash flow. Net sales was SEK 200 million in the quarter, representing 4% growth or 6% organic growth against the same quarter last year. We had a gross margin of 70% and that entails also an increase in our amortization of capitalized development expenditures for bone marrow, and also the upgraded software program that we are amortizing throughout the full quarter. And here we are now amortizing SEK 4 million versus SEK 2 million last year.

Operating expenses landed at SEK 100 million, equaling 50% of net sales. And if we unpack that, we see that sales and marketing expenses are kept on a stable level. Administration expenses were impacted by the costs of SEK 9 million, associated with the initial phase of the CEO transition. R&D costs before capitalization were SEK 45 million, just a little higher than last year. However, comparing to the same quarter last year, we have a lower capitalization of SEK 15 million versus SEK 20 million last year. And that results in an R&D cost of SEK 30 million. The lower capitalization is mainly due to different maturity stages of our ongoing projects and we expect to see some increase in capitalization from Q3 as projects are maturing. The EBITDA reached SEK 55 million with an EBITDA margin of 27%, and the increased operating expenses related to the initial phase of the CEO transition, of course, impact these results.

Adjusted for this, EBITDA and EBITDA margin increased compared to the same quarter last year. We are continuing to invest in R&D with 22% of net sales. Our R&D investment programs are developing well and maturing according to plan. Finally, operating cash flow was SEK 29 million. Working capital increased by SEK 32 million during the quarter. Accounts receivable increased as a result of the higher sales and contributed negatively to cash flow, as did the increased capital tied up in inventory as a preparation for summer break. Total cash flow of minus SEK 58 million for the quarter included dividend to the shareholders of SEK 66 million. And our financial position remains robust with cash and cash equivalents of SEK 172 million sitting on the balance sheet. And let's go into the regional development.

Thank you, Monica. So just briefly a quick comment on the business by region. So if you look first at America, this is an all-time record high quarter driven, as I said earlier, by large instrument sales, tender wins and instrument refreshes. Sales increased to SEK 105 million, up from SEK 66 million last year. And really, this is a reflection of our strong partnership in the U.S. Our sales here are really being driven by robust demand in the large- and medium-sized laboratory segments but it's also boosted by strong order books in Canada and LatAm. And this reflects excellent marketing and commercial activities that have been carried out in the run-up to quarter 2 this year.

In EMEA, sales amounted to SEK 75 million, which are slightly down on last year. Here, we see the full impact of the now concluded inventory adjustment from our main distribution partner. And we are confident that, that inventory adjustment has now been fully executed. The bone marrow launch that I referred to earlier, has generated initial sales and a lot of positive customer interest with commercial activities supporting customer evaluations at numerous sites. These activities have remained high throughout the quarter, supported by our presence of key industry events. And it should be noted that instrument sales in EMEA are above quarter 1 and above the same quarter last year. For APAC, sales amounted to SEK 19 million, significantly below quarter 2 '25.

Now on the face of it, this looks extremely disappointing. However, there are underlying positives. Here, we see the double impact from China. We're trading market conditions today remain challenging for current trading. But also we have a tough comparison quarter for Q2 '25. This included significant instrument module shipments to enable us to locally produce in China, which, in the long term, will make us more competitive. But that quarter last year was particularly tough to compare against. If you look across the APAC region, reagent sales grew strongly, particularly in Japan and Australia. And this is excellent news for us because this is a recurring business. Sales were also boosted by a UN tender win, as I mentioned at the start.

We quickly then look at sales by product line. Instruments really drove the quarter results up 7% to SEK 113 million. As I said, it was an all-time high for large instrument sales, particularly in America. Primary driver here is automated workflows of midsized and large laboratory networks. The order intake in EMEA is slightly affected -- or sorry, still affected by the concluded inventory adjustment from our main partner there. And there's a steady performance in APAC with sustained traction in key markets outside of China, as I mentioned. If we look at the reagents, sales increased by 11% to SEK 42 million in the quarter. EMEA reagent sales were in line with the same quarter last year despite temporary delays on shipments from our production site due to the recent heatwave in France. So due to excess temperatures, we had to requalify materials from the warehouse. And this led to some delayed orders, which had not happened, would have posted higher growth. In APAC with strong growth across all subregions, particularly in Japan and Australia.

And then finally, if we look at software and other, the sales amounted to SEK 46 million in the quarter. And it should be noted that the software sales aren't completely synchronized with the instrument. Obviously, we sell the instruments, but there's then typically a lag or delay which would then be software would then be consumed once the instrument is actually installed at the customer side. So quarterly fluctuations in software sales have impacted the EMEA performance overall here. And then the other segment consists mainly of spare parts, consumables and currency effects. So if we move to Slide 6, just to summarize the overall picture for the quarter. Key takeaways this quarter, we delivered an increase in net sales of 4.5% to SEK 2 million. Sales increased organically by around 6% with 1.1% headwind on FX. EBITDA delivered a result of SEK 55 million, which corresponds to 27% EBITDA margin. And this is in line with typical returns given the costs associated initially with the CEO transition.

The commercial launch of Bone Marrow Aspirate application marks an important milestone as we expand into specialized microscopy. We continue to progress the FDA registration process, and the aim is for F10 clearance in the U.S. before year-end. And from an innovation perspective, FPM technology, as I mentioned, it has progressed through our internal development fees significantly. FPM will form the foundation of our next-generation hematology analyzers. This progress strengthens our confidence in FPM as a platform technology for future innovation beyond hematology in adjacent markets such as pathology and cytology. These are excellent markets to be able to penetrate. The results that we're seeing reinforce are confident in the market opportunities we face and it demonstrates progress in translating our investments in innovation into commercial results.

As I step into the role of CEO, I'm committed to building on this momentum by combining our strong innovation portfolio with more focused commercial execution. And with that, I'd now like to open up to questions. I will be ably assisted with by Monica today. So if there are any questions, I can answer, I'm happy to do so. Anything that requires more information or it's beyond my 5-week knowledge gap, I'll hand over to Monica. But very happy to receive questions.

[Operator Instructions]

The next question comes from Christian Lee from Pareto Securities.

Yes. I have a couple of questions, and I will take them one by one. The first is regarding the exceptionally high growth in Americas. And since you already have a high large instrument penetration in North America. Was this growth driven by Latin America or by replacement cycle activities?

Okay. Thanks for the question, Christian. The main driver for sales here is robust demand for the larger instruments in the medium and lab segment. And this is -- the drivers here again were tender wins and instrument refreshes in those segments. The LatAm and Canada business are showing promising growth within that. But the main driver here is that lab segment, those 2 large segments.

Okay. If I remember correctly, I believe you have almost 100% translation rate in North America. So how come you can show this kind of growth rate in the second quarter?

Yes. I would say that we have a high market share in the large and medium lab segments. So there's refresh and tender wins that are coming up. They are continual. So there's a life cycle laboratory systems that we have an opportunity to win new business, but also to refresh. But there are other segments outside of that, that probably touching on commercial focus, I'd like to explore more. So the smaller labs where perhaps our partners aren't present. There may be more opportunities for growth here in the future for us. It's by no means saturated, I think there's still room for growth in America and that region.

Perfect. My second question is regarding EMEA and with the inventory adjustment now concluded at your main distributor there. How do you see the Q3 demand trajectory? And could you also perhaps give us color on the share of EMEA sales that this partner is representing?

Yes. So the share, we have a strong partnership with our main distributor partner and the majority of our business goes through them. Quarter -- the order book looks promising for EMEA. It looks like we have a strong order book for quarter 3 overall, but we're confident that the inventory the patient has now been run down, and we're seeing orders in Q3. Monica, if there's anything to add there?

No, that is correct. So inventory adjustment has been completed, and the orders are coming back to normal levels now in Q3.

The next question comes from Simon Larsson from Danske Bank.

Maybe also following up on the Americas print. Just wondering if you are aware of any channel stuffing in this very strong second quarter and maybe how you could help us line out the future here for the second half, if it is something to be extrapolated or if, yes, should this sort of be a more normalized pattern in second half for what you see in Americas?

.

Yes, Simon. I missed a word there. Sorry, could you repeat the what stocking?

Yes. So if you're aware of any channel stuffing or like stocking effect in Americas, yes, given the strong print, I mean, how we should think about it when we think about our estimates for the remainder of the year in America specifically?

Yes. So I would say there's no evidence there at the moment, Simon, if anything, it's the opposite. The inventory normalization, if that's the right word, that impacted us in EMEA. There was also some of that in America as well. And we did see -- we've seen units being consumed. So we have -- as a response to this, we've had much stronger dialogue with our partners. And we have a set of processes that will give us much clearer, much more transparent visibility into their inventory levels. So we're confident that actually the order book for both America and EMEA will be robust for the second half of the year.

That sounds reassuring. And also on the Bone Marrow Application, which I think you sold your first couple of units here in the quarter, are you still sitting to your former statement on -- I think it was like 1 or maybe 2 percentage point incremental growth here for second half from that product? Or what internal expectations do you have for that product here in the second half?

Yes. Thanks, again, Simon. We maintain the same view. The initial feedback, there's obviously a long lead cycle in in vitro diagnostics, especially in diagnostics as customers evaluate new technology, they have evaluations on site, qualify the instruments and the analyzers on site. So there is a long lead cycle. But having said that, the news that is coming back from the market, the number of valuations and the customer reactions is extremely encouraging. And we still hold our position that by year-end, the bone marrow sales should account to 1% to 2% growth, that range.

Perfect. And also in APAC and the reagent side of the business, a couple of strong quarters in a row now. Just curious to what drives that adoption? What kind of users, if you can name any countries, stuff like that, just to get a grip of that business?

So the main -- in the quarter, the main customers are anyone who's producing or staining microscope slide. So that could be any laboratory, any research institute, it could be partners that we're selling through. The growth is encouraging. As you said, it's sustained now. We're starting to see momentum in that area and it's a role, it's a model for us to look at for the other regions.

Looking at the country specifically in APAC, it's Japan and Australia that have -- are really driving the growth. And like I said earlier, this is pleasing because that is recurring business for us. So those are the 2 that would highlight in that. And that's despite significant headwinds in China for not just CellaVision, but for the industry broadly. So to see that the reagent growth in APAC is very, very encouraging.

Yes, and are these like pilot projects that are now transformed into returning customers, so to say? Or how is that sort of -- how was the development been like when it comes to...

Yes. Maybe, Monica, you can add to this, but the business that we see coming from Japan and Australia in Q2, that is definitely recurring. I think the majority of the sales elsewhere tends to be recurring. But Monica, if you want to comment on that?

Yes, you're right. And we have spent a lot of resources on really getting into those markets here in Japan and Australia, and it is recurring revenue.

Yes, good. Maybe a final one from my end to you, Steve, because I noticed in the CEO letter that you talk about commercial execution a couple of times. So I was just wondering what that sort of entails for you given the tight relationship with your main partner today. Maybe one would think that there's maybe not that much you can tweak in the go-to-market strategy. Please correct me if I'm wrong. I mean, what are you seeing when you speak about commercial execution, what can be done better or more from CellaVision side?

Great question, Simon. I think firstly, let me talk about our major distribution partner. This is in the fact that we want to be more commercially focused is actually a reflection that we want to invest more in that relationship. I think that partnership is successful for both parties. It has been a great relationship, and we want to make sure that we sustain that and nurture it. I think there's a lot more that we can do we are serving the customers that we jointly serve extremely well. But there are other segments out there and other -- so the laboratory segments, where perhaps our partner is not playing that I would like to get closer to. And that could in turn throw more opportunities for the partnership.

But I want to make sure that every laboratory everywhere in the world that has a microscope is aware of the CellaVision technology. And that's an opportunity for us to take more responsibility in that, looking more at the horizon and really understanding the customer need more closely. But I would like to stress that we do that in partnership with our major partner globally. The other thing to talk about is as we expand through FPM, there could be other segments outside of hematology, that we really want to get to know better. So that's -- when I talk about commercial, I want to really understand that we understand the customer need, the end customer and that we're continually evolving our solutions to meet those needs fully.

The next question comes from Ludvig Lundgren from Arctic Securities.

And congrats on the appointment. So I have a few questions, and I'll take them one by one. So maybe just starting off a bit of a clarification here on the destocking you saw on the instrument side in EMEA in Q2. If you're able to quantify approximately how much this affected in the quarter? And then also as well, how much -- if you can quantify the delays in shipments in Q2?

I will start with that one, the first question on how much the EMEA inventory destocking impact in Q2. It was not that much. It was mainly in the beginning of April where we saw it was still slow. But then throughout the quarter, we saw that orders were coming back. So the impact was not that big in Q2. And then when it comes to the reagent delay in France, it's a couple of million SEK that were delayed into Q3.

And if you remember, in Q1, there were some other delays happening that we now got in, that was the UN tender. So things happen between the quarters, but about a few million SEK were delayed due to the heat wave in France.

Very clear. And then also a bit of a follow-up on large labs in Americas. And I wonder if you have seen any change in lab investments or large lab investments and tender activity during the quarter? Because I know that Abbott guided for accelerated core lab demand in H2. Do you share that view or yes?

I think, if I can, just the results from our side would indicate that those segments in America are growing strongly. But we haven't seen anything specific that we would call out from an external perspective, as Abbott has done.

Clear. And then on the cost side, I note that admin expenses was up about 10% even after adjusting for the CEO transition costs. So I just wonder if there's anything you can call out there if there was any other nonrecurring items?

There were some additional consultant costs that came in as part of the admin costs this quarter.

All right. So like trying to dissect an underlying admin costs, would you say that it's more flat year-over-year? Or how should we think about that one as we head into H2?

Yes. There is some increase due to salary increases that happened from first of April on all personnel costs in the company. There has also been some investments, especially in the IT area, and that is going into administration costs as well. That could be more fluctuating throughout the quarters.

All right. Very clear. And then a final one, just on the total or yes, R&D, including the capital light portion grew quite a bit here year-over-year, which I assume might relate to the upcoming U.S. launch of the bone marrow. So maybe, yes, help us how we should think about this as we head into H2. Is this a new level we should kind of extrapolate or how to think about this number?

R&D costs, excluding capitalization are increasing slightly, exactly, as you say, as we are spending some resources also on the FDA applications and also increased focus on innovation. But if we then start thinking also about what we capitalize, then we will see higher capitalization starting from Q3 due to the fact that we have some projects that are advancing in the majority. So that will compensate for some of the increase.

Great. And then if I just could squeeze one more in. Just on the estimated time line for bone marrow launch in the U.S.? Is there any news there or like FDA application?

We're in line with expectations, Ludvig, that should be there by year-end. So we're in dialogue and the process is going according to plan.

The next question comes from Elvin Rolder from DNB Carnegie.

A lot of questions asked already, but maybe I'll ask a follow-up on one of Simon's question regarding kind of the commercial execution part. I hear that you want to accelerate the partnership with Sysmex. But kind of a follow-up to that. Is there any kind of -- now I know that it's early days for you Steve, but are there any kind of -- if we look on a regional basis where you feel that CellaVision perhaps has been lacking a bit historically, where you feel that you can accelerate either salespeople or support functions in order to capture kind of a higher share of growth? I know that you've invested quite a bit in the Americas. But are there any kind of regional white spots where you feel that you're able to kind of accelerate the organization a bit, if you can comment.

Yes. Great question, Elvin. Thank you for that. I think firstly, the relationship with Sysmex is vital for us, and I think it's symbiotic. I think there's a lot of value for both parties. Together, our combined value proposition is greater than the sum of the individual parts. If you look just at the results, the relationship in the Americas is particularly strong. And I think that's the role model for us, and that's a discussion that we're already having with Sysmex and how can we win together more effectively using, for example, the Americas as the strongest model.

Having said earlier, I think it was Christian or Simon's question about market share in America. I still think there's more in America that we can go after. And I think that in every country, we can be more effective together. And that's why we want to invest in that responsibility for it, for our part and that really drive more effective commercial activities.

Great. Maybe then a question on Americas then on smaller instruments, you -- for the second quarter now, I believe you mentioned that there has been some, I mean there are some elevated inventory levels in America for smaller instruments. Can you give some sort of outlook or guidance on when you expect these effects to kind of normalize and when smaller instruments can pick up again in the region? Or how should we view that for H2 and onwards?

Yes. From what we're able to see. And again, Monica, please chip in if I misunderstood this. But from what we're seeing, we think that the inventory normalization has washed through. So we did see consumption from their inventory in quarter 2. And also we have an order book. We have orders placed already for Q3.

Perfect. And then finally for me, a nitty-gritty question, perhaps irrelevant. But you say that the quarter was charged with SEK 9 million for the initial phase of the CEO transition. Should we expect any further CEO transition-related costs in Q3? Or is that -- how should we think of that?

Yes. Thanks,. I think the cost incurred so far are a mixture of the CEO severance the recruitment costs and then other involved consultants. The discussion is still ongoing, so it's not possible to comment any further on that. This is obviously a transition period. But the costs associated to that first year have been -- they've come to SEK 9 million in quarter 2. And at this point, I can't really comment any further on that.

The next question comes from Christian Lee from Pareto Securities.

I have a follow-up question regarding your R&D expenses. Monica, you mentioned that you expect capitalization increase in the third quarter. Is that in absolute terms compared to the second quarter? And could you also give us some color on how we should consider the total R&D investments, including the capitalizations in -- starting from the third quarter?

Yes. So they will increase versus what we have seen now, Q1 and Q2 capitalization has been quite low. We believe we'll go back to levels where we were in the beginning of last year and probably a little beyond that as well when it comes to capitalization as we have some bigger projects now advancing through our different toll gates, which means that we are starting to capitalize them.

And then your question was also about the total R&D costs. And there, we see some increase versus previously, but that one is not, it's not huge, it's gradual increases that is hiring more people into the organization, takes more time is more gradual increase. So there will be a positive impact on R&D costs, excluding the -- including the capitalization.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thanks, everyone, for joining the call this morning and for following us here at CellaVision and thank you, in particular, to the 4 analysts who ask us questions. Before I close today, I'd like to thank all of the team at CellaVision for their very warm and they're very patient. Welcome as I get up to speed as a new CEO.

I want to thank, in particular, Simon Ostergaard, the outgoing CEO, who has been really working with me on a very professional and very smooth handover. And not just for this, I also want to thank Simon for his contribution over his 5-year tenure as CEO at CellaVision. Simon's work and that of Zlatko before has built a tremendously strong company with huge opportunities for growth. And I'm really excited to be at the helm to help the company realize its potential going forward.

Our next interim report will be published on the 29th of October 2026. And I look forward to commenting on that report with you then and to take your questions at that point. Thank you for joining this morning, and have a great day.

Welcome to CellaVision Q1 Report 2026. [Operator Instructions]

Now I will hand the conference over to CEO, Simon Ostergaard. Please go ahead.

Thank you very much, and thanks for dialing in to this quarterly financial call, I have our CFO, Monica Jonsson, with me, and we are pleased to present our results and answer any questions you may have subsequent to the presentation.

So we just released the first quarterly report, and it was with a header, soft quarter due to lower sales in EMEA. The quarter resulted in net sales that decreased by 14.6% to a revenue of SEK 166 million. So that's an organic decrease of 6.6% as we had almost 8% headwind on currency. EBITDA amounted to SEK 40 million, so that corresponds to 24%. And as we say in the report, the -- and given the title here, EMEA is affected by inventory adjustments with our main distribution partner and that is what has caused this significant negative growth compared to the comparable quarter last year. So that's the bad news. There are no fundamental changes to our business model or the market conditions but this is the situation that we announced today.

We are also announcing that we have continued momentum in our strong region in Americas, and we continue to see double-digit organic growth in Americas. And furthermore, and this is getting more broader within APAC, we see traction to convert labs, and we see positive development coming out here in Q1.

With regards to our strategic direction, since we've been investing in new product development for quite some years. Now we are at the -- we're starting to launch these new components. And there are good examples coming out here in Q1. So we have launched the CellaVision Bone Marrow Aspirate application after we received CE Mark that was planned for Q1, but we got it just before Christmas 2025. So we have started our SoMe campaigns, we've started participating at conferences, and we're in the process of training our distribution partner, Sysmex to really position this, I would say, great product to the clinical community. So we expect to see a funnel being built throughout 2026, and that will result in revenues contributing in the second half of this year.

We've also launched, globally, our updated software. This is the largest software upgrade for our platform ever. So it contains both user interface, improved workflow features and also, in fact, for new DI-60s, a higher turnaround. So more blood samples can be processed. So it's a very, very powerful package that is now available, both to upgrade existing networks but also as part of the new DI-60's [ result ].

And then finally, in our investment program, it is important to emphasize that we are still extremely confident and we're pushing our next-generation solutions with FPM both for hematology and then we're exploring our opportunities very successfully to also be deployed in other areas such as cytology and pathology.

So let's unpack the P&L. So as I said, SEK 166 million, representing minus 15% growth or minus 6.6% organic growth up against last year. We had a gross margin of 68% and that entails also an increase in our amortization of capitalized development expenditures, given the bone marrow and the upgraded software program that I just talked about. So here we are now depreciating SEK 3 million versus SEK 2 million. Operating expenses landed at 51% versus 41%. In fact, it's equivalent to a higher spend of operating expenses of SEK 5 million. And that SEK 5 million is actually also the difference in terms of what we are capitalizing.

So EBITDA of SEK 40 million, as said, so 24%, which is, of course, lower than our expectations, just like -- which is a function of the miss in top line that I will explain a little bit later. We are still investing in our R&D, but there are changes also to the maturity or the early stage program that we are running, which is also a function of how much we can capitalize. So that's also part of the reason why you see a different capitalization of SEK 12 million this quarter versus in the comparable quarter, SEK 18 million. So we had a lot of hardware investments in the comparable quarter, which are not sitting in this quarter. So that's a function of the program.

And then finally, operating cash flow-wise, SEK 62 million. We had a SEK 40 million and then plus the working capital. We had accounts receivable that contributed positively to our operating cash flow of SEK 62 million. And then we had investments and financing activities that are deducted and that results in a total cash flow of SEK 42 million. So still, as always, a positive cash flow. And now with cash and cash equivalent, the company has SEK 230 million sitting on the balance sheet.

So the regional highlights. So America here, it is really important for me and the team and our partner to emphasize the strong momentum we have with 13% organic growth. So 2%, but negative currency effect of 12% gives us the 13% growth. We saw continued strong adoption of our integrated large instruments for the hospital community around the U.S. We are focusing and pushing the concept of connected labs to position the DC-1 in these integrated health networks. So we are working very strongly together with our American partner organization to push this. We also saw a little bit on speaking about the small lab segment that is served by the instrument, DC-1. We saw actually a little bit of instrument decline, but there was also a little bit of a pent-up purchase of small instruments given the tariffs and uncertainties throughout 2025. There's a lot of activities going on to really serve this segment, and there is a lot of appetite for that value proposition of connecting that with our integrated solutions.

For EMEA, yes, we mentioned some market uncertainties. I'd say, demand-wise, there is still really an ongoing appetite to digitalize the labs across the different markets that are immature and mature in very different degrees. Say what we hear is that public funding is a little bit under pressure given the defense situation of Europe, which does delay certain tender specs. So that's kind of the market condition. The minus 32% growth or minus 26% organic growth is not related to the market. This is really a situation around the temporary reduction in excessive inventory that hit us in this Q1. So the root cause here is pent up a number of units sitting in multiple affiliates probably over some time that has happened to mitigate deliver risk from ERP implementations. So here, as our partner Sysmex comes to their fiscal year, which ends by the end of March, then there has been a strong push to cut down and really examine where they have inventories, and that has resulted in obviously less orders, significantly less orders for us in this quarter. And that is really what we are reporting here.

It's important for us to emphasize that we flagged that -- is it over? Is all inventory done in Q1? We cannot promise that. There may be something that sits in the second quarter. So stock may still remain in Q2. However, we expect better installment sales in Q2. And we don't expect negative growth, but it's a little bit too early to say what growth will come in Q2. So we are being extremely transparent and conservative here, but I think it is really the best of the knowledge that we have currently. But as I said, it's early days with one month into Q2.

APAC, here, we landed at 10% growth, so SEK 22 million, of course, up against the -- it's a smaller number, so to speak. Having said that, the positive thing is that we start to see traction across APAC. We have previously been very exposed in China and we are seeing diversification and a broader demand for our solutions across Southeast Asia, which is super positive.

We'll take the numbers, which on this slide is cut per product category. And yes, for the instruments, I think what I'll highlight there is that the miss that amounted to -- so from the SEK 86 million in instruments versus the SEK 115 million in the comparable quarter. That is essentially the EMEA miss that we are seeing here.

For the reagent business, a stable business. I would say what we have managed to do is over the years, if you followed APAC, which has been insignificant. Now we're getting to a level where it starts to really contribute. It's across multiple countries as we have launched our RAL classic stain portfolio across APAC together with Sysmex. And here, this quarter, we reached almost SEK 4 million versus a comparable figure of SEK 1.4 million. So we are starting to see some traction here, which is really the signal of a long journey, which is extremely positive.

For software and others, minus 2%, so pretty much flat. I would say, though, that the software is less than it was in the comparable quarter, and that is a function of less instruments. And then there's a little bit more on others, which entails spare parts and also our FX.

So on this slide, the final slide here, our key takeaways. Yes, we are extremely transparent around our softer quarter, which is really due to the lower sales in EMEA. And this is the root cause for having only minus 7% organic growth, which is, of course, not in line with our expectations. However, we still think that there is opportunities across EMEA, and that is also the signal we get from our partner that there are multiple opportunities across the different segments we operate in.

For Americas, Strong momentum, it continues. And also here, I would say there are opportunities with new products, and that leads me into the Bone Marrow. And other news that we report is that we have filed to the FDA, our Bone Marrow Application. So we're in process of registering our Bone Marrow Application as a 510(k) and get clearance for that for the U.S., so we can start commercializing the Bone Marrow Application together with the DC-1 and our Remote Review software as a package to support the clinical that are diagnosing leukemias, lymphomas from bone marrow.

And then again, I mentioned our software upgrade. There are multiple global training activities going on across the Sysmex organization to position our Software 7.2 which allows the hospitals to get improved user interface and a better workflow, more speed if they go with the new DI-60s. So that's really another pivotal thing.

And then as also mentioned in the beginning, we are extremely confident, but also extremely committed development-wise to continue to push our relatively mature development program for our next-generation solution that entails our new microscopy technology under the name of FPM, Full Ptychographic Microscopy and which we're also exploring and seeing opportunities in adjacent segments such as cytology and pathology.

So with that, I think I will close the presentation and then Monica and myself would be happy to take any questions you may have. Thank you.

[Operator Instructions] The next question comes from Simon Larsson from Danske Bank.

So maybe starting off with the obvious question here. on the inventory dynamic situation in EMEA. Could you help us understand sort of when the destocking take place? And how do you see your stock churn out here, given that you say that this could potentially also affect the second quarter? So any more flavor here would be very helpful.

Yes. Thanks, Simon. I think when it took place -- so you can say we were informed in this quarter. So I think the increase is probably throughout last year when there were ERP implementations. That's kind of how we understand the situation. And we believe that the majority of the stocking is probably digested throughout this quarter. but there may be somewhat of a spillover of a little bit stock left in the subsequent quarter. That's the best information we've gotten.

Got you. And also, if you could give any more color on the European public health care budget constraints that you mentioned also. What are your customers telling you now? And do you have any kind of time line for when things could potentially improve?

No, I think what we hear is that, in general, and I think we all know that there is a debate in all countries around investments into the defense, and that is driving a little bit of pressure also on the health care side. So that's what we also -- when we discuss this with our partner with certain countries, it's not all countries, but there are countries -- as an example, the U.K. where there appears to be a little bit of delay of tenders coming up as a result of the demand for financing other activities outside health care.

Makes sense. And also on the sort of focusing on America's margins, large instruments seems to be doing quite all right, but small instruments are still a bit muted. Could you help us understand, I guess, what initiatives you are taking in the go-to-market strategy to really sort of reach your full potential with the DC-1 instrument on the smaller customer side?

Yes, sure. Yes, I think it's doing okay. I would modify it. And I think they're doing extremely well. It's a large market where our partner has the vast majority of the market. So they continue to win across those mid and large segments. There is a lot of activities going on to embrace also the small lab segment and especially around the IHNs, the integrated health networks where smaller labs are connected and administered under the large lab umbrella. So you can do the block work distantly by placing these DC-1s, and then you can remote and take the diagnostic decisions centrally at the large labs. So that value proposition and the way to set out these digital networks both with a [ certain ] structure and so forth. That's an ongoing training exercise towards our partner, so all the reps but it's also a demonstration exercise towards the integrated health networks in the U.S. that takes place in a very sort of structured and a very focused way.

And that value position has been, let's say, been -- increased focus has taken place as an example, also during our national sales meeting with our partner, Sysmex this year. This was a key focus. And this is what we believe will be part of the conversion of these labs over time.

Yes. Okay. Good. And maybe the final one from my end. On the Bone Marrow Application, I think you're writing that you expect it to contribute positively in the second half of the year, I mean what kind of volumes are you expecting? And should we read this as it will be sort of meaningful to group growth already this year? Or is it more a '27 story?

No, I think what we do here, it's always -- when you talk about launch, it's very important also to be aligned on what does launch mean. The first step in our launch was actually getting the registration in place so that we could start the commercial launch activities and that is where we are. We have positioned, we've made all the launch material. We've launched -- we've gone live on SoMe's channels, various SoMe channels. We are very active last week. Last weekend, we participated at the ISLH, a big European show for bone marrow and hematology. And here, we presented our solutions. So we are launching marketing-wise. And obviously, the exercise in parallel is to train Sysmex to explain how you -- the value of our product, how it's -- to demonstrate it and to persuade the clinicians essentially, that's the sale process. So we're in the process of really getting Sysmex trained and competent in conveying our product and our solution. And that's what takes place pretty much from now on and onwards. And that will gradually build a funnel, and that's what we say that we expect that to translate into sales.

We have -- the first couple of sales are coming in but it's more meaningful to talk about it in the second half, I would say. But we hope it will contribute -- we expect it to contribute with 1% or 2% in terms of company growth, that would be our ambition level. But let's see as we start building the channel, we are very confident that we have a very, very good offering. That's the initial feedback we get from the community.

The next question comes from Christian Lee from Pareto Securities.

I have a couple of questions, please. I think you mentioned that you didn't expect negative growth in EMEA in the second quarter if I heard you correctly here. Does this refer to EMEA overall or specifically to instrument sales in the region?

Yes, I think my comment and thanks for asking that question because I want to be clear on that. So my comment relates to the inventory issue. So that relates to the instrument. So there -- but I would say that it probably translates to the quarter as well. That would be my initial feeling around that. It will not be what we've seen in Q1 but we are being very transparent that we don't necessarily see the actual stock level being depleted in Q2 but we do expect an increase if we compare Q2 to Q1. We do expect that we will sell more instruments, and we will have no negative growth on that.

Okay. Clear. And there also appear to be elevated inventory levels of smaller instruments in the Americas. Do you see a similar risk of inventory overhang impacting sales in the second quarter there?

For the U.S., specifically, Christian? Is that right?

Yes.

For the U.S., I don't foresee any inventory issues with regards to the large instruments, only the small instruments. That could still be the case. That is a little bit of a journey and also because of the major uncertainty and mixed signals that has come out with regards to tariffs, that has influenced the stock situation on the American side. Having said that, I'd say after the sales meeting, we ramped up and focused on this connected less concept and we -- and our Sysmex colleagues are really hanging on to that now and really doing a great job in pushing it. So we expect that the demand will increase throughout the year.

Okay. Perfect. And if we exclude the impact from smaller instruments and the currency headwinds in the first quarter, would instrument sales still have shown a double-digit decline or being closer to flat?

Monica, maybe you can help me out here?

Yes.

I would...

More closer to flat.

On the large instrument, right?

On the large instrumentals. In EMEA, we're talking about.

Yes, maybe [indiscernible] maybe slightly positive.

So flattish for the larger instruments or for the whole instruments?

I think it's fair also to emphasize here that -- so that's why I'm doing the math. We are up against a very tough compare. That's important to say. So the Q1 in 2025 was actually a very strong quarter in EMEA. Having said that, that's where we aspire to be. But just to get -- when we talk about growth, I think it's important to emphasize what we're up against.

Okay. And my last question here. R&D expenses almost SEK 30 million in the first quarter. Should we expect this level to persist throughout the year? Or was Q1 elevated?

[ Yes ]?

Yes. So maybe I can take that one. I mean the SEK 30 million on R&D spending is also related to that we are capitalizing less at the moment. We see that the organization is working on early-stage projects, and we are looking into starting to capitalize some of those coming up Q2, Q3 somewhere. So when we start capitalizing that, then you will see somewhat of a decrease on R&D costs at that stage. So Q2, Q3, you will see somewhat of a decrease. But that will come with an increased CapEx then.

Yes, Christian, it's a little bit of a portfolio shift due to the accomplishment of launching these products. So that's the process we go through.

The next question comes from Ulrik Trattner from DNB Carnegie.

Just essentially a few follow-ups on my end. Like looking in hindsight here for the EMEA region, I don't see a single quarter throughout '25 where we're supposed to see any type of elevated levels of inventory buildup, or does this gradually happen throughout the entire 2025? Because if I look at the first half of '25, you had SEK 88 million in sales. If I look at the second half of the year, you had SEK 88 million in sales. So where are we supposed to see the inventory buildup in historical numbers, is essentially my first question, please.

Yes. So it's spread out. And it's spread out -- to the best of our knowledge, the first event actually goes back. So there are two disruptions taking place. One was back in autumn '24 when Sysmex changed their inventory, their warehouse in Hamburg, which was a disruption and then followed by ERP SAP implementations. That has caused certain affiliates to -- or quite some affiliates to actually build up a little bit of local stocks, so they were able to supply and install the blood lines when the customers wanted to do so. And that has sort of persisted gradually over time during -- both to mitigate any disruption from SAP and the part of the pieces from the disruption of the distribution center. So that is what has been setting in apparently throughout quite a few quarters, small blips which adds up to now prior to this fiscal year closing then there was an attempt to really work on the capital tied up in instruments. So their working capital, their inventory level. And this is where we saw this major dip, which came a little bit as a surprise on our side but that is the situation.

Okay. So just to get some clarity, if we were to adjust for this, throughout 2025, we would have sort of reach ex growth? Or like you presented 5% growth in 2025. Yes, some negative FX effects, some headwind there, but there's not that much growth from EMEA in 2025. So adjusting for this, was growth negative in '25 by your estimates?

No, I'd say more flattish.

Okay. I understand your uncertainty here. And I guess, lack of transparency from Sysmex' side. But what's your sort of confidence levels that we have sort of churned out the built up inventory in the first half of '26 given the sort of prolonged buildup of inventory heading into this?

Yes. I think it's important for me to emphasize that we don't -- we would never excuse -- not for being transparent. I think this was also -- they're a much larger organization. So this is a symptom of running a global business -- in EMEA with multiple entities. So this also came to their attention. So -- and then they have been super transparent around the situation. I think that's important for me to emphasize.

Having said that, and that's what we try to communicate, the biggest hit inventory-wise, we've already taken that and then there may be some spillover. So if they don't come down to quite the level, then there will be a little bit sitting in Q2. However, we already see that we're on a positive trajectory when we compare to this quarter. And this is why we are confident that we are at least not coming out with negative instrument growth in this quarter that we're in. We can certainly sort of emphasize that.

Having said that, over time I still think that there is -- so we're still working on the market opportunity. That is also emphasized that the tender opportunities and the market opportunity, they remain. So there's a solid foundation for the business still. Of course, the macro environment, we sense that it's more influenced in Europe than what we see in the U.S. There's -- and that's not necessarily a macro piece. It's probably also the more private hospital setting with the networks, et cetera, where we have a working model with Sysmex.

And then just on the market environment. And as you mentioned some delays in terms of tender activities. But even from sort of absolute numbers here, Obviously, you have this sort of inventory churn but I'm trying to sort of find some type of confidence level here in absolute numbers. And I'm not really sure sort of which period historically to look at. Should we look at post-COVID, Should we look at 2025 year, are you supposed to have interest rate fear? Is it a worse macro environment now compared to '25?

Probably a little bit more unpredictable. That's kind of the signal we get, but it's getting a little bit more unpredictable as opposed to a year ago. That would be the -- I wouldn't go back to COVID and so forth, I'll just say sort of -- but if your question was also related to the inventory period, I would say, 6 quarters.

The next question comes from Ludvig Lundgren from Nordea.

A few follow-up on my end as well. So starting off in EMEA, I just wonder if there -- you saw any effects or weakness in the Middle East here in Q1? And if you expect any effect from this in Q2?

Yes. Middle East, we've actually seen effects from -- on the reagent side, where it's been very challenging to deliver. So we've definitely seen some impact there. That would be the majority or that would be the main point I would emphasize here, Ludvig.

Okay. Great. And is it possible to quantify that, the few million lost sales or something?

Yes, that's probably appropriate.

Great. And then secondly, I wonder on the Bone Marrow Application. You mentioned that you have filed the 510(k). So just when was this filed? And have you gotten any indication of when they could come back to sort of say, I think they typical aim for a 90-day period, right?

Yes. No, that's right. We follow also what is the process formally and so forth. So I think to the best of my logs, we filed on the 11th of March. And then we have started the interactions with the FDA. We are also sort of saying, okay, process-wise. I'd say in general, we get the feedback from the diagnostic community that the response with FDA has probably increased sort of lately, I'd say, over the last year or two. That's kind of the general sense in the industry. So if you ask me sort of when do we expect it to come, I'd say I'll emphasize, of course, we need to qualify to get the 510(k). That's the first thing. So there's always a little bit of profitability there.

Having said that, we expect it to go well and to have this in 2026. Best case would be mid-26. That's a little bit on -- that's the best case. But assuming we get it, then we do expect to get it sometime in this year. There is some phases in terms of question and, et cetera, and they stop the clock. And so we're up against a time line, which is pretty controlled. But I'd say 2026 is what we aim for. And hopefully, we have good news at some point as -- the earlier, the better. So we obviously also started our launch considerations with our partner on this pivotal products to supplement our offering. Thanks.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Thank you very much. And first of all, thanks to everybody for taking the time to dial in and following us here at CellaVision. So I will close the call by saying that the QS1 results. They, of course, represents a mixed bag across the regions. It is important to confirm that they -- we have momentum in our strong market position in the U.S. We are reporting an unforeseen inventory adjustment in EMEA. So we said this is a temporary blip, which is also the nature of our business model, I should say. Not that we like surprises, but that is what we need to deal with. And then I think it's also important to emphasize that we are really expanding across Southeast Asia. So I'm looking forward to share other further development in those regions.

And then finally, you've seen that things are starting to come out of the Power of Focus with the product launches. So we are very excited about that. And I want to use the opportunity to close the call also by thanking our partner organizations both on the development side during the -- when we have assessed our products, but also now that we are launching and we are training the staff, and we are rolling it out to build pipelines that can translate into additional sales. So there is -- we can just emphasize that our leading product offering and the underlying market demand, it remains intact and unchanged with this report despite this blip on the inventory side. And with that, I'll close the call, and I'm looking forward to report the next time.

We will have our Annual General Meeting here in Lund on the 28th, so on Tuesday. And then the next interim report will be launched -- published on the 17th of July 2026. So I'm looking forward to present that report and to take any questions you may have. With that, I wish you a good day. Thanks for listening in.

Welcome to CellaVision Q4 Report 2025. [Operator Instructions]

Now I will hand the conference over to CEO, Simon Ostergaard. Please go ahead.

Thank you very much, and thank you very much out there for dialing in for CellaVision's quarterly report Q4 2025, which obviously also includes the consolidated results from the entire 2025.

A lot of good things have happened. And first of all, I want to formally welcome our newly appointed CFO, Monica Jonsson, who is with me today to participate and, of course, explain our business. Monica has been with us since autumn, and she was formally appointed CFO with CellaVision on December 12. So that was the first good news.

Hopping into the quarter in brief, the Q4 in brief, we have entitled our quarterly report as a solid quarter driven by strong performance in Americas. So it's particularly in Americas. However, we also see a pretty strong performance in EMEA, while the quarter has been somewhat soft in APAC, and we will unfold that throughout the -- today's call.

We landed the quarter with net sales that increased by 5.6% to a revenue stream of SEK 197 million, which translates into an organic growth of 12.2% given our headwind on the FX of minus 6.6%. So double-digit growth throughout this quarter. This translates into an EBITDA contribution of SEK 65 million, equivalent to 33 percentage points.

In terms of the business, we will go into the business and explain both our P&L, our regional split, give some highlights there and of course, also cut it across the different product families. But I also want to give a little bit of insight as to our progress on our strategic direction.

We accomplished a key milestone by getting CE Mark for our new applications for bone marrow aspirates. So this is a Class C product that is now registered according to the EU IVDR, which allows us to start launching the product this year or pretty much in the quarter we're in. We can talk more about this a little bit later. We have also -- as we've noticed in our latest report, we've also been working on a significant software upgrade for our hematology instruments.

This has been successfully validated at a customer site. So this really allows to upgrade our fleet with a modern and user-friendly interface, some new features, including also higher speed on the new DI-90 -- DI-60s that comes up. Furthermore, I also want to emphasize that the -- since we are coming to the year-end, the Board of Directors proposes to increase our dividend from SEK 2.5 per share last year to SEK 2.75 per share.

So this is what will be proposed at the Annual General Meeting taking place on the 28th of April. If we zoom in on the financial development for Q4, I've mentioned our revenue. And then if we hop in -- so on the left-hand side, we have the quarter we are reporting today, the comparable quarter, and then we've consolidated the entire full year report with a compare from 2024 to the very right-hand side.

For the quarter, our gross margin was 67%. So a little bit lower than normal, a little bit hit by software, especially from APAC, but also FX also takes us down a little bit here. Operating expenses landed at 39%. And EBITDA, I've talked about the SEK 65 million that is 33%, which is above our target of 30%.

And then we -- on the R&D side, which is really very strategic for us, we've increased our R&D spends over the -- within this strategic period. So we're at 19% and up against the compare, it drops from 22%. So it's actually SEK 37 million in total R&D spend. But maybe I can ask you, Monica, to comment on our capitalization and also -- maybe also our principles for capitalization that might be appropriate.

Sure. So during the quarter, we capitalized SEK 15 million in R&D costs. And as you can see then that we capitalized more or less half of the R&D spend. And what is not capitalized is mainly related to projects that are in an early stage and also product care. And you will see during 2026 that we will start capitalizing some of the projects that are maturing and also start depreciating some projects that we are launching products such as bone marrow.

Excellent. So the -- so on the cash flow side, operating cash flow of SEK 51 million, so slightly increased with SEK 5 million versus our comparable quarter and a total cash flow of SEK 30 million.

So going from the operating to the total, the majority of that is really the cash that we invest and capitalize in R&D. That's what sits there. We have low -- very low financing activities. So we have hardly any debt, and we end the year with a balance sheet that contains a cash position of SEK 180 million -- SEK 188 million, sorry.

All right. Yes. So I could say that here, we are also showing the full year results. So we landed the plane or the year of SEK 759 million, which is an organic growth of 9% over the year and a gross margin of 68%. And that provides a total cash flow of SEK 40 million. So obviously, we've paid out dividends, and we have also capitalized a considerable amount of R&D cost of SEK 67 million throughout the year. So that is the main components that brings us to this total cash flow of SEK 40 million.

Right, let's move on. Let's try and look at the regional performance across the 3 regions, Americas, so North and South EMEA, including the Middle East and APAC. So our performance was very strong in America, in fact, all-time high with SEK 90 million. That is an organic growth of [ 50% ] throughout the quarter, also 50%, but then the headwind of currency effects. So organic, 58%.

Very strong momentum in Americas, especially in the U.S., which you may also -- by Sysmex in their last couple of reports, Sysmex being our main strategic partner. So that is kind of the business that is elevated as [Technical Difficulty] our joint momentum. It is fair to say that it's extremely high, and that is also due to the presidential election in [ Q4 this year ]. I think that's a fair comment to provide the full picture.

For EMEA, we had -- there, we also saw an increase in both in small and large systems. And we obviously also had a contribution from reagents, but they actually impacted negative this quarter. There is -- that is a euro business. So we are primarily [ impacted by ] currency. And then there's a little bit of phasing on there. But I can talk more to reagent in a second.

On APAC, we landed sort of in -- we -- typically in APAC, we have high fluctuations depending on whether we ship to APAC, in particular, China or not. And here, we landed in a pretty reasonable quarter, SEK 28 million. However, it does represent an organic decline or growth of minus 40%. And that is also due to a strong comparable quarter.

You may recall that we had a, let's call it, a one-off tender delivery for New South Wales in Q4 last year, which is why we organically declined so much because it's a reasonable quarter where we've seen deliverables going both to China and to Southeast Asia, a little bit spread. So -- and then we continue to see growth of the -- our expansion into APAC throughout this -- a lot of countries, of course, smaller volumes, but we are building our position with the RAL stains across APAC.

And if I cut the same numbers per product family, instruments, reagents, software and others. Here, you do see that our total instrument revenue was SEK 126 million, and we talked about the U.S. and the other elements. But it gives us a growth of 8%. For reagents, we actually were flat or minus 2% on the total business -- on the total business for the quarter, which translates into 6% growth on the year.

So organically, around 9%. EMEA decreased slightly. And as I said, that is primarily currency. I would say though that we -- our hematology, which is the growing portfolio we have, what we -- what does not relate to the hematology labs and then the hematology reagents. Hematology reagents, which is the bulk of the business, like 2/3 of the business, it grows 10% for the majority of it, which is for Europe. And in APAC, where we've started to expand with our hematology reagents.

There, we also had solid growth, but though smaller numbers. But we grew on the quarter from SEK 1.4 million to SEK 2 million with -- up against the comparable. And that pretty much more than doubled our revenue in APAC on the year. For software and others, we had declining growth for -- I should say software and others. It contains both spare parts, of course, software and also consumables such as oil, but it also entails the currency effect, which impacted our numbers considerable from a comparable position here.

Specifically on the software, we were low in the compare and there was a major contribution from APAC due to the large tender we provided last year, where we also -- that also entailed a considerable amount of software. So this is also why we see the decline.

Key takeaways, as we say, the fourth quarter is driven by strong performance in Americas. We said we landed our year with 9% organic growth. And in fact, if I really look at where we work and how we work with our strategic partner organizations, our core strategy, it works. We are growing double-digit with these -- both partner organizations across the world.

However, we have some product -- some product lines like non-hematology other products that has taken our organic growth a little bit down. But our direction is paying off. And that also -- that is also consistent with -- that also applies to our Power of Focus strategy that we communicated in 2022.

Here, we invested a very ambitious investment program in R&D and innovation. And one of the levers was a new lever of entering what we call the specialty analysis arena. So more applications to assist the hematology labs out there to diagnose blood-based disorders. The first product is out. That is the product for bone marrow, as I initially said.

So we do believe that now we can start building the market for assisting the lymphomas and leukemias out there in the hematology lab and adjacent labs where they utilize this hematology solution or this bone marrow solution. So we are starting to launch. First, campaign-wise, there will be training of our partner organizations. There will be building of a funnel, and then there will be evaluations of -- and really for the health care professional to see how it assists their workflows.

And then we do expect that we -- in the, let's say, the second half of the year, we will start seeing revenues from this product from Europe. And then we are, of course, also on that note, aiming for getting into the U.S., but more about that later.

As mentioned also when we teed up the call, we have a major milestone in launching the software upgrade that delivers this faster and smarter workflow and cutting-edge user experience for the hematology labs. And actually for the new DI-60 systems, that is integrated with the hematology line of Sysmex. It offers an improved integration, but it also entails an improved throughput.

So the number of blood samples that can be deployed will increase on the new DI-60s. So we believe we are well positioned to continue our journey in assisting the mid- and high-volume labs. So very important key takeaway is repeating back to our Power of Focus, where we in early 2020 -- or in spring 2022, we acquired the exclusive rights to -- IP rights to a patent portfolio that was invented by Caltech.

And we have deployed and further developed our technology in our hands. And as you can see in the way we communicate, we're extremely confident that this will really support our next-generation hematology analyzers that are part of this major investment program that CellaVision has gone through and is going through. And furthermore, we are also very clear on our ambitions to expand and deploy our capabilities for adjacent areas.

And here, we are also confident to say that we truly believe that the way we go about pursuing our vision of really pushing the evolution of microscopy, we have a disruptive microscopy solution in our hands. And we believe that, that is something we will continue to invest in, and we will also pursue future partnerships that can help us commercialize these technologies in the future.

So with that, taken together, the -- I do believe we ended 2025 on a pretty strong note with 9% organic growth given everything that have happened. And I'm actually very proud of the team given the fact that we've done this with our existing portfolio, and we are seeing now that our innovation program pays off, and we are starting to start launching all these new opportunities, which we are very confident will be a profound platform for future growth.

With that, we will close this session and enter the Q&A.

[Operator Instructions] The next question comes from Ulrik Trattner from DNB Carnegie.

A few questions on my end. First of all, and I apologize, I struggle a little bit with the sound, maybe it was just me. So it might be things that you already addressed. But if I can start off with the DC-1 and the DC-1 momentum, particularly in the U.S. And you sound like current trading and what you did see throughout Q4 was really improving. Is that something -- what do you derive that from? Are you seeing that there is sort of increased capacity from the labs to expand and invest versus last year or the reasoning behind the current sort of situation and demand flow?

No, fair. And thanks for your question, Ulrik. I think we see a momentum also given the softness we experienced a year ago, then gradually over the last half of 2025. We've seen positive momentum communicated externally by Sysmex and what -- how the market is operating on the large lab segment. And we've seen that translate into that also entails our solution, our integrated solution.

And at the same time, we have seen the interest, let's say, come back on the DC-1. And I think what is happening, and this is also something we are really starting to position the targeted opportunities for the integrated health networks in the U.S. So there, having the labs that can digitalize the satellite labs, that is the value proposition. So there's one story around the workflow for the individual labs.

But then what we are really seeing resonates in the U.S., because they are digitalized to a relatively high degree, that is attaching these IHNs or the integrated health networks to distant satellite hospitals. And this is where we believe there is a market that is, I shouldn't say untouched because we have certainly placed DC-1s, but the opportunities is much larger than what we have placed so far.

That's great. And for the last few years, we have seen this prolonged order to installation trend. Has there been any shifts sort of in that being shortened here? Or is it still the same situation?

No, I think typically, from orders are placed, let's say, in the U.S., it is our belief and understanding that, that is pretty much a phase of 2 to 6 months. Then we have been in a situation where it probably was longer. And now it seems like we're somewhat back to that kind of up to half a year. And that's because hospital places the order with Sysmex, and then there is an installation project starting up.

So that means that everyone, IT, et cetera, has to come together and then all the equipment, the cell counter, including CellaVision's cell morphology analyzer needs to be in place. So this is why from the orders of Sysmex to that, that is about this -- up to half a year. And then it varies. We saw the tender we talked about in Australia that took 5 years. So it does vary. There are deviations to this rule of thumb.

And this -- you touched upon this now with sort of the software, I noted as sort of software and others in your report, had a bit of weakness here in Q4 affecting the product mix. And as you alluded to the sort of larger tender in Australia, and now you're rolling out an updated version. What to expect from that segment? I guess you would assume some big price increases for software heading into '26 versus '25.

Actually, that's not how we position this. We position this solution as part of the -- both the new DI-60s. So we want to be competitive and protect the installed base, also the replacement market. So this is not an upgrade where we charge. It's part of the DI-60 system. But what it does, it also allows the health network.

So if you take a given hospital with the satellite hospitals, et cetera, they -- if they upgrade to this software version called 7.2, then all their entire fleet, including the old instruments, will all of a sudden be utilizing a new user interface with the improvements that we are launching in the software.

So this is a way to really provide additional customer experience prior to our next generation coming out. So we have sort of considered that's a better proposition as opposed to starting a price, we would rather increase right prices when we come out with new hardware.

Okay. So that would entail that there is no price increase of the DI-60 either. It's just...

No, there will be price increases on the instruments, but we will not sort of take the route of just charging for software. We believe we have a better -- we will capture the growth from the instrument placement instead.

And then just an accounting question here and just to double check if my sort of maths about sort of aligned with yours. Because capitalized R&D historically has had an effect on the gross margin side. So I'm -- and now when you're rolling out the bone marrow application, I'm approximately at a 1 percentage point headwind on the gross margin on the back of starting to depreciate that. Does that sound fair?

Yes, that sounds reasonable.

Great. Short answer, I like it. And then last question on my end before going back into the queue. If you can provide some more granularity on the rollout of the bone marrow application and the methanol-free reagents throughout sort of '26? And going to the bone marrow, is there -- I know that you say that you will do a launch here in Q1, but is there any conferences here in the near term where you're going to do more of a broad-based launch as well as how does the training of Sysmex personnel going?

Great question. Yes. So for the bone marrow, you're absolutely right. We'll start sort of the SoMe campaign in this quarter in March. We will -- we are in the process of training the Sysmex reps. And once that is done, then we will, of course, start to position our solutions in the -- in Europe across the different countries.

There will be demos in the different individual labs, and then it's commercially available. With regards to conferences, we'll do the big launch at the ISLH later in May. That's in May. So that's the big conference where we sort of give the splash. And then we will also be present at [ ACP ] later in the year.

But ISLH is the biggest launch sort of event. Coming back to the quarter here in Q4, I just want to express my appreciation also for our partner organization who has been with us on site here with Sysmex, where we have presented the bone marrows and then we actually obtained the bone marrow CE Mark before Christmas as opposed to Q1 as we had pointed.

But that is kudos to the team for actually driving this to be in our hands a little bit earlier, but also to Sysmex who are really welcoming this significant product. On the methanol-free, I can also --you -- right, you also asked about methanol-free, right?

Yes.

Yes. The story around the methanol-free stain is that -- so we've been selling our -- our reagent revenue is primarily the classic stains. And now we have this methanol-free stain. We've had it for years, in fact. But now there is an opportunity for the methanol-free to be running on the SP-50, so the smearing and staining device of Sysmex.

And that has opened up for the opportunity to globalize [ methanol-free ]. So this is -- this will be available. It is available in Europe. But this is also the opportunity to enter the U.S. where we have hardly been selling any reagents. So this is obviously the plan. We are currently in the U.S. We are current, let's say, tweaking the protocol, so the actual stain resembles what is preferred in the American market, right, right, Giemsa stains. So it's still methanol-free, but there is a little bit of trick going on there, and then we plan to launch it this year. So this is the plan together with Sysmex. That is the game plan for to get into Americas or the U.S.

The next question comes from Ludvig Lundgren from Nordea.

Yes. So I have a few, and I'll take them one by one. So starting off on order intake, I believe you said you have a very strong order intake in Americas from the networks. So I just wonder if it's possible to, in some way, quantify the book-to-bill here in the quarter and whether the strong order intake, is it fair to expect this to translate to strong instrument placements also in H1 '26?

Yes. So in general, there is a momentum in the Americas and especially in the U.S. So it's early days, and we don't typically disclose our order book for the current quarter. Having said that, I see no reason why the momentum for Americas should vanish. So I think we're in a reasonable solid situation there from what we hear from the market situation.

Okay. Great. And then I had a question on gross margins as well, a bit of a follow-up. So softer here in the quarter. And I just wonder like if it's possible to quantify how much of this relates to FX and how much of this relates to the softer software sales and the weaker product mix from that, like in rough terms would be great.

Yes. Comparing to last year, it's a lot of FX and somewhat product mix. Exact relation here, I will not disclose, but a little more FX than product mix.

Okay. Great. And then a final one from my side on gross R&D. You talked a bit about it here, but I just wonder like it was down to SEK 37 million, down 9% year-over-year, I believe. Like why was it down this quarter? And like how should we think about this R&D -- gross R&D level looking into '26? Is SEK 37 million a reasonable level to extrapolate?

Yes. Actually, we see some decline in R&D spending in Q3 and Q4 versus last year's Q4, Q1 and Q2, and that is mainly due to the phase of one of our biggest projects where we had a lot of buying of consumables during Q4, Q1 and Q2. And then due to the phase of the project, we do not have that in Q3 and Q4.

And then also, we have released some consultants that worked on the software upgrade project after the Q2. But what we see going forward, we will see continued high R&D costs actually in 2026. We have many interesting projects that we are working on. So I would expect more in line with Q1, Q2, Q3 levels also during 2026. So Q4 is not significant what you will expect for the next year -- for this year. So more in line with the quarters.

Understood. Yes. And just a follow-up on that, like what is a fair capitalization rate to expect on these projects then in '26?

Yes, more or less at the same level. We'll see.

Higher or lower. Yes. Okay.

Probably the same level. The projects that Monica elaborated, some of them will be early stage, which means that we don't capitalize. And then some of them will actually make it throughout our development model, and they will cross the line and start being capitalized. So there's a little bit of balance.

And then we have a few that were capitalized up until Q4 that are now depreciating. So that is then evening out.

Yes.

The next question comes from Simon Larsson from Danske Bank.

Yes. I think most of the questions have been asked and answered already. But maybe just to clarify, did you say that we should expect, Simon, some contribution from the bone marrow application in EU here during the fiscal year in H2? Was that correct?

Yes. It's -- so we're building up the funnel, but we do expect that -- so the question is how long time does it take for the labs to evaluate it before they place the order and we ship to Sysmex. However, we are positive that we should start selling and see invoices, so to speak, in the second half and in particular, in Q4. That's our ambition, definitely.

Yes. Yes. I think also this was touched upon before, but on the methanol-free [ reagents ], obviously now available in EU with Sysmex. Is this more also a second half thing? Or could we see something here already in first half?

Yes. I think for EU, I think the methanol-free stain represents a growth opportunity in general because it's a better value proposition. However, given the market share we have on the route and there is markets where we have a very low market share where there's plenty to do and there's markets where we have very high market share. But we will cannibalize a little bit in Europe. So that's my point that we may transfer certain classic stain customers to methanol-free in Europe.

In the U.S., we expect that we will gain share as we start pushing this because there, we have 0 market share. We own the market together with Sysmex, but reagent-wise, this is when we start with the methanol-free. So there, we will gradually gain customers as they convert their engines and the line is down, then we expect to place methanol-free stains gradually.

That contribution for 2026 is probably somewhat limited because it's also depending on the launch and then there is a phase where the customer would like to try it out. So therefore, we would be a little bit conservative on estimates for contribution from methanol-free in the U.S. I hope that explains the situation, Simon.

Yes, yes, definitely. And could you remind us roughly the difference in price between the methanol-free stain and the legacy stains from RAL, just in the case of cannibalization, I mean, what's like the net effect can be?

No, I'm not going to go to the pricing piece also for competitive reasons. But there will be a little bit of a lift. But I would say -- remember, this is -- the hematology reagents are a little bit commoditized. It's high volume, but it's not sophisticated chemistry. So we will raise the price, but it's -- you cannot go for extra sort of top margins in this market.

No, no, that's understood. My final question relates to the FPM technology. You sound quite upbeat in the CEO letter, I think, around it and the prospects. So I was just a bit curious to learn about sort of what a potential partner could look like? Do you expect that to happen within the hematology market where you are present already today with your current existing partners? Or could this also be a new partner in an adjacent area? Just high level, if you could say anything about that.

No, I think, yes, high level, I'd say definitely the position we have where we lead the hematology space, we are very confident, and I'm glad that I transmit the positive and confident attitude because that's what we have.

So we are very -- we are now at a stage where we are confident to protect and grow our business in the hematology arena. The adjacent areas, this is where we've also, throughout 2025, matured the technology to a level, so that we've talked about cytology, we've talked about pathology. We're confident that we can actually build instruments for those segments.

But there are other adjacent areas in the clinical space and in the research space, where we believe that the FPM technology, given the image quality, given also the speed, but the depth of focus. And there are a number of features where we believe we can disrupt those segments. Those will be players in the microbiology arena, in the hematology/cytology -- sorry, in the pathology/cytology arena and in the life science space.

So now we're in a situation where we can engage more, let's say, fundamental and more substantially with partners because they can see what we can, and it's not just IP rights that we have acquired. So that's why we are pushing our communication a little bit further because we are confident that we sit on a disruptive microscopy solution here. And of course, we are looking forward to disclose partners or improvements as we go along. So yes, so that's, of course, our goal.

The next question comes from Christian Lee from Pareto Securities.

Yes. I have one follow-up regarding the order intake. You mentioned that you reached record levels in the quarter from larger integrated networks in the U.S. Did you deliver most of it in Q4?

Yes. Yes, that may be worthwhile sort of communicating that the order intake, it is also shipped. And then we believe we still have momentum for Americas. So yes. What you see is what is shipped, that's what we booked for Q4. So that is correct.

All right. But do you see any risk of inventory buildup impacting Q1 in the U.S.?

In the U.S., I'd say roughly speaking, maybe a little bit for smaller instruments, but not necessarily for the larger instruments.

All right. And could you please give us some comment on the outlook in the other regions regarding the instruments?

Yes. I mean, I think that's along the lines of what we've said with the momentum we've seen in the different regions. So we believe that translates into orders. Now the business is fluctuating a little bit. And for Americas, we have relatively good visibility. It's a little bit harder for us for Europe because it's a consolidation of orders that comes from multiple countries via [ separating ] via the supply chain of Sysmex and then it comes to us.

So there, we actually have less visibility. What we hear is that there is -- this is what we communicate and we have seen it over the last couple of years that there's a fundamental interest and -- for our solutions. And we see no reason why that shouldn't stop. And then, of course, we may have some fluctuations per quarter.

But fundamentally, we believe we're in a pretty good situation also now that we are launching new software, et cetera. That makes us believe in the future. APAC, I would say we think we have good opportunities, incremental business in Australia and New Zealand. There could be some opportunities also in Japan. And then as you know, we are now manufacturing our integrated system in China.

So that allows us to participate in domestic tenders where you have to be a domestic player and our products is registered in China as a -- being a Chinese -- coming from a Chinese legal entity. So over time, we still believe in China. However, we also know that this is where our competitive -- our competitor is strong. So we're up against that in China. But it's a huge market. So we believe that there's certainly a position for Sysmex elevation out there.

The next question comes from Ludvig Lundgren from Nordea.

Yes. Just another follow-up on the reagent side. So that was a bit weaker in Q4 when comparing to Q3, but Q3 was, of course, very strong. So I just wonder like is an average of this a fair assumption going ahead? Or like what would you say is the run rate of reagents currently?

No, I agree. I think Q4 was a little bit weak, both on the hematology side, even it was 10% organically, but we were flat, if not negative on the non-hematology proportion. So we had a big tender where we expected -- we've been working on that throughout the year, where we didn't ship products.

So we were a little bit negative on that. So I think Q4 stands out as somewhat of a soft quarter on the reagents, and we expect it to bounce back and especially with the growth coming from the hematology where -- which represent approximately 2/3 of our reagent business.

Okay. Great. And a follow-up to that, like what is a fair growth rate that you would expect for the hematology business? Like can this grow double digits looking into...

Yes. I'd say historically, we've been landing at probably lower double-digit for the hematology. And I see no reason why we should -- it's a considerable business. So it takes more to change the growth, so to speak. However, with the gradual increase, we've seen the 80% growth we have on the hematology side in APAC.

However, it's a small contribution, obviously. Total revenue out there this year was SEK 9 million. But still, it's growing. And then as we start over the next coming years to get into the U.S., I think that's where we can probably even more ambitious of getting higher growth rates for the company in the revenue bucket because this is really incremental growth that comes in, while we still believe that we have opportunities to grow double-digit in Europe, where we have a profound footprint.

It's really a big thing for us that we can finally enter the U.S. given the fact that our -- the Sysmex smearing device can now host the methanol-free stain. So it is exciting for the coming years to start and build that market.

And would you expect some incremental sales in the U.S. already in '26 from this?

Yes, I would expect it, but I don't want to overdo it. I would say that I'm much more -- if I can see traction from the ones starting to use methanol-free, that would be our -- really our goal, but it will translate into some revenue, but it's at the end of the year, I would expect. So that would put us in a situation where it's confirmed in the market, and that gives us a good platform to -- for growth contribution in '27. I think that's the way to look at it.

There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Yes. Thank you very much. And again, thank you, everybody, who called in and not the least to the good questions that gave us a meaningful report out here today for 2025. I want to sort of finish up the call by saying that I think what we have demonstrated throughout the previous year, both on commercial arena, but also on our investments and the organization's ability to translate the investments into to meet very, very crucial strategic milestones.

That means we are set up to continue our position of leading digital cell morphology into the future. So thanks to our team for the relentless effort that you all do. But also thanks to our strategic partner organizations spanning from Japan and all across all regions around the world. I think that is key.

And then finally, I also want to send my sincere thanks to our entire group of hematology professionals who are actually using our solutions on a daily basis. And amongst that segment, a special thanks to the ones who are providing us with feedback to our development programs and/or who has participated in our clinical validations, which has been a considerable part of the investments.

But again, the good example is the bone marrow CE Mark that we, of course, want to leverage for a global product. So I really -- a big thanks to our employees, our partners and our professionals that we work with as customers.

So with that, thanks for dialing in, and we are looking forward to actually be back with the interim report on the 24th of April. And then we have our Annual General Meeting for the April 28. So thank you very much.

Welcome to CellaVision Q3 Report 2025. [Operator Instructions] Now I will hand the conference over to CEO, Simon Ostergaard.

Thank you very much, and thanks to everyone taking the time to listen in to our quarterly report that we've launched this morning for our third quarter. I'm happy to say that I also have our Interim CFO, Monica Jonsson, with me, and we'll be happy to also answer any questions you may have when we get to that part of the session.

So, the quarter in brief. So, we have named our quarterly report softer quarter with mixed regional performance, and this is also related to currency effects. We saw Americas and EMEA had some quarterly variations resulting in modest growth, which we are highlighting here. We are coming out with a quarter here where we are reporting net sales decreased by 1.7 percentage points to SEK 176 million. However, due to the FX headwind of minus 4.3%, then sales increased organically by 2.6% during this quarter versus the comparable quarter last year.

On the EBITDA side, we increased our EBITDA to SEK 50 million. So, we increased by SEK 1 million, and this relates to -- or corresponds to an EBITDA margin of 28%, also a small increase.

In terms of what we want to highlight with regards to our strategic direction and our progress, we actually see a lot of progress. It's a very exciting time for the company and our partner. We're highlighting the fact that we've completed our clinical trial. We've submitted our documentation to receive the CE Marking for our bone marrow application.

So, we do expect this one to be done according to plan and obtain the CE mark by here we say, early 2026. I think we've said Q1, so that's still in line. But we are positively optimistic around it, even though there are, of course, always risks with anything, but this is an exciting time. So now we are really looking into training and the commercial launch activities for 2026.

Another big chunk of our investment has gone into an upgraded software for our platforms where we've done the verification that has been completed and now being installed at customer sites for final validation before we roll it out, which is planned for next quarter, which is this quarter here in November.

All right, here we go. And then a slide around the financial development. So, it's a busy slide, but what you have here is our Q3 numbers reported fresh at the very left-hand side, the comparable quarter and then the year-to-date numbers for 2025 in the middle, followed by the compare last year and then the full year 2024 on the very right-hand side.

So, I talked about the organic growth and the revenue of SEK 176 million. If we sort of peel the onion and then work our way through the P&L, that translates into a gross margin of 69%. So, we increased the gross margin by 1 percentage point. We had full impact from our price increases during Q3, and we had a little bit of a product mix. So that was a positive contribution.

On the operating expense side of things, we invested SEK 82 million, went down with -- as compared to last year, a little bit on sales, a little bit on admin and according to plan, invested a little bit more on the R&D side. So that actually translated into a growth of EBITDA of around 2 percentage points. So, from SEK 49 million to SEK 50 million despite the negative decline in revenue.

On the R&D side, as you can see, 24% so we have -- of sales is what we have invested into R&D, of course, slightly affected by sales. However, really, the investments are following our plan, and we've capitalized a little bit less than normal, only SEK 14 million this quarter, which is primarily due to the vacation piece and partly also completion of the software upgrade, which also had a little bit of an impact on how much we capitalized.

On the cash flow side of things, we had a cash flow before the working capital items of SEK 52 million. And then the working capital adjustments or impact was actually minus SEK 22 million, and the majority of that was from accounts receivable since we had quite a number of orders being placed in September. So, this is why our accounts receivable increased.

So, we had an operating cash flow of SEK 29.6 million, SEK 30 million. And on the investment side, we invested SEK 22 million, both on the capitalized R&D activities, as I said, but also investments into data storage was a significant chunk this year to serve our capacity for some of our new technologies. And then after subtracting our SEK 4 million of finance activities, the cash flow that were related with that, we ended up with a total cash flow of SEK 4 million. So that's really the story around our P&L.

Let's take a look at the regional highlights. So, in Americas, we had 68 million on the top line coming from the Americas region, South and Northern America, which is equivalent to an organic growth of 4%. So, we also had currency effect there, of course. I'd say, in general, it was carried by -- it came from really good traction on the large instrument platforms and less from the smaller instruments, where we saw a modest decrease. However, we also saw good traction in Latin America. So that is also positive for future growth.

In general, I'd say our sort of also when we look at our leading indicator in collaboration with our strategic partner. We believe that we have an increasing potential in the U.S., which was also confirmed in the half year report of Sysmex launched yesterday.

In EMEA, likewise, sales amounted to SEK 96 million versus the SEK 98 million last year. That is an organic growth of 1%. I think this was actually acceptable also in the light that we were up against a pretty tough compare since we had inventory buildup in the comparable quarter last year. So, a decent single-digit growth in reality. We had reagents growth as well, quite a bit from EMEA. However, on the hematology side, it was modest -- very modest with only 1%. So, there is some phasing of orders on the hematology side there. But generally, a good 14% growth on the reagent business.

For APAC, I'd highlight that it was a soft quarter, SEK 13 million, so 10% growth, but of course, on a very low base. This was also what we hinted in our previous quarterly report where we had some inventory shipping since we are entering our program where we are manufacturing out of China. So, we ship quite a number of parts and instrument modules to China, which impacted sales, but this was the main contributor to a soft sales across APAC. We sold also outside of China. So, we do see momentum in pockets across Southeast Asia and Australia. So that is a positive outlook there.

And then I also want to emphasize that we are seeing a good traction, 5x improvement of revenue sales from our reagent in APAC. Of course, it's small numbers in APAC, but it gives us the confidence that we -- that our penetration and expansion in APAC on the reagent side is on the right track.

If we cut the numbers in terms of sales per product group. So same numbers but sliced per product category. We have SEK 93 million versus SEK 102 million on the instrument category. And again, contribution from the large instruments was important. And then as I just alluded to on the Made in China initiative, it is very important for us to be able to participate in the market in China by manufacturing our instrument in China. So that is a project that is also coming to the end as part of our strategy.

On the reagent side, I mentioned the growth of SEK 40 million in revenue versus the SEK 35 million. So that's the 14% growth. So good to see also that our -- what we define as non-hematology is actually contributing with a decent sort of single-digit healthy growth this quarter here. So that is really good.

And then finally, on the software side, SEK 43 million. So -- and that is also a correlation up against how we're doing on the instrument side, but it is actually a decent software revenue we accomplished. And also, we had a contribution coming from spare parts and consumables worth SEK 23 million.

So, the key takeaways is that, as we say, yes, we've had somewhat softer quarter with some different variation across the regions. But the underlying is a healthy business, which is supported by the gradually expanding strategic partnership, which is advancing across multiple dimensions on internal processes, on the -- now the focus also on launching the products.

This is another thing that the power of focus strategy that we launched in June 2022, it is starting to provide the output, both from what you see when we decided to enter the specialty arena or specialty analysis with the bone marrow that is expected to come out.

So, our focus and activities are really on training and commercial launch activities, and so they will be here as we start the new calendar year. I also emphasized the software upgrade without going into details prior to launch, then I would say that it is delivering a faster, smarter workflow, and it does have a new cutting-edge user experience.

In terms of our fifth pillar in our strategic direction or strategy, the power of focus, we also have these new areas where we expand beyond hematology, which is really the focus of deploying our full Ptychographic Microscopy technology, the FPM technology. And we have reported that we are lifting this into our next-generation hematology analyzer. And that is really proceeding according to plan.

And based on this development, we are now also able to really scan different sample formats in the context of cytology and pathology as an example. And that is also an exciting area where we are having discussions with partners -- potential partners playing in those field. So taken together, a solid quarter. We worked hard, but also on the R&D and now on the marketing side is ramping up. So, it's a pleasure to present the results today.

And with that, I think we should open the floor for questions. Any questions are, of course, welcome. Thanks.

[Operator instructions] The next question comes from Simon Larsson from Danske Bank.

I'd like to maybe kick off with a question on the software upgrade you announced here it's rolling out. Should we expect any financial impact from the rollout here already in Q4? And will this be sold as an option to the customers? Will it be mandatory? How will you charge for it? Just any more color on the software upgrade would be helpful.

Sure. The software upgrade is seen as an upgrade on our instruments, both on the usability and the performance to improve the workflow. We have decided to -- that this will be part of the package when you purchase the blood line, [indiscernible] as an example, then this will not come with an additional fee for the end user. So, this is really a means of differentiation. So, you should see this as a growth contributor by keep on being relevant in the labs and demonstrating our innovation muscle prior to our next-generation system. That's how you should look at it.

Okay. That's very clear. And also, on the R&D CapEx here going forward, I think roughly the levels now, I'd say, like SEK 70 million per year capitalized. Should we expect this to decline here going forward as the software product is now rolling out, bone marrow is coming out. Of course, we're still investing in the next-generation instruments, I suppose. But how should -- how do you believe we should look at the capitalized R&D here in the coming, let's say, 1 or 2 years? Should it decline more to a historic level, or should it be kept roughly at the same level?

Yes, see, our aspiration is really to maintain focus on us being an innovator -- innovation company. I think we are at a pretty decent level here. On the capitalization, we have a portfolio of projects we want to start -- so this is also a bandwidth question for us. I think we're at a reasonable level. But as we see more of our projects being terminated, it is a balance as to how mature are new projects? Are we capitalizing or are they more immature than that.

So, you may see some changes in our capitalization, but our intention is actually to keep on investing in the R&D phase. We expect that as we see more changes also throughout next year, we'll probably give more sort of guidance or update on how we see it as we've come to the end of the power of focus. So, we will certainly be more specific around this particular question as we enter 2026.

I think that would be a good idea. I think just as you're now sort of finishing up a few of these bigger projects, it would be good to help us understand how we should look at this going forward.

Maybe the final one from my end. You mentioned, I think, that the cash flow was a bit held back by an increased amount of orders placed during the end of the Q3 quarter. Could we expect that sort of this dynamic to sort of has continued into Q4, i.e., that sort of how you enter Q4 is looking sort of good on that same trajectory? Or was it just a matter of timing that it sort of ended up in the late Q3 here order intake and delivery?

That is simply just the nature of the payment terms when we receive the orders throughout September, then that's why you see this fluctuation on accounts receivable this time around. It's not a systemic thing per se. It's really a timing thing.

The next question comes from Ulrik Trattner from DNB Carnegie.

A few questions on my end. Starting off with the product mix and the gross margin, and you say you've had a favorable product mix here in the quarter, improving margins. But regardless of the mix, some portions here in your profile are increasing its gross margin sequentially, systems software or reagents. And because the margins are a bit higher than it's been before, and you're still sort of affected by negative FX in the quarter. So, can you help us decipher what segment is improving its margins?

I think -- so pricing was one element. In terms of mix thing, we still have -- we have 14% growth on the reagent side. That actually pulls down the margin. We have a little bit lower margin on the reagent side versus instruments and software. But that was still -- despite that, we had sort of solid growth on the large instruments, which kind of contributed to the 1% increase versus the last year.

Still sort of when I sort of -- any way you look at it, if you split it up into 2 segments, like cell morphology systems or morphology systems and reagents, some of these segments have improved its gross margin sequentially and year-over-year.

Yes. So, help me out here. What are you looking for specifically which product group is it that you're...

I'm just trying to figure out sort of what in the product mix have increased the margin. Regardless of the mix, some of your system or reagents have increased its margins sequentially. And I'm just trying to figure out whether sort of which part of it is moving the needle.

I think maybe this time around, I think we had probably more contribution from large systems versus the small. So that has been a contributor -- positively contributing to the overall gross margin. I'd say that's probably the driver you're looking for.

Yes, That’s great. And the software upgrades live here in November enables you to commercialize wider sort of the MCDh reagents. Have you received any feedback from customers? And can you just give us sort of the highlights here of how you intend to commercialize it sort of near term? Will it be initial sort of customer feedback then gradual ramp-up? Or how should we view this?

Yes. That’s a great question. No, you're absolutely right that the software upgrade also comes with the opportunity, you can say, changes on the steering and staining device by Sysmex, which is called SP-50. So that has also been upgraded so they can host our methanol-free stain. That's an important part of this integrated software upgrade. So that allows us now to actually start positioning methanol-free stains or Sysmex to position the methanol-free stains to be used on the SP-50, which is a major milestone.

So, we're in the phase of evaluating the stain with customers. I believe that Europe will be first. This is where we have the majority of our business on the [indiscernible], the classic stains. So, there will -- there can be some conversion, but obviously, the value proposition of methanol-free is strong. So, we can -- that can still contribute in Europe.

And then it's also an enabler for the U.S. And we expect the launch in 2026 for the U.S. Here, there's both customer assessments and a little bit of, you can say, regional preferences that we are working on finalizing, but we expect the launch to be happening next year. That's kind of where we are for the U.S.

And if we were to look at sort of China, and you've been working here and we can read in the reports on sort of transferring systems. And I guess it's Sysmex that is trying to build up manufacturing in China in order to participate in local tenders. So where are they in terms of operations in China?

They have a fixed site in China where we work together. So, we are doing our manufacturing of our Chinese devices within China, in their plant as part of that. And they also have cell counters manufactured out of China. And as you say, rightfully, that allows us to actually participate in hospital tenders or deals where it's a prerequisite that you have Chinese manufactured instruments. So, this is why this strategic initiative has been an important enabler for us to continue to compete in a more competitive market as opposed to other elsewhere.

And are we to expect any effects from that initiative or...

Sorry, can you repeat that, Ulrik?

Are we supposed to expect any acceleration in China sales from this initiative in the near term?

I think it's fair to be mindful also, if you read the report that came out yesterday from Sysmex, it is obvious that China is a fierce competitive market to be in. However, this gives us the opportunity to actually compete in collaboration with China in that market. So, protecting the market share that they report they have, and of course, aiming for growth via differentiation, is our game plan. But it is fierce that we all know that both on the pricing side and on the competitive side with local players, it is a difficult market, but it is relatively sizable out of our APAC numbers, which is also why we have invested in this program to protect our position.

Okay. Great. And last question on my building a little bit more on the capitalized R&D. It's down quite a lot sequentially. And as you highlighted sort of summer months and reported R&D is up. To what degree is this sort of just summer months in prioritization? And how much of this is pipeline maturing? The bone marrow application has now been submitted. What is left in terms of R&D spend for bone marrow application and as well sort of the software upgrade, is also now a commercial product. So, I guess that will not run you that much R&D.

No, that's true. I think after Q2, we also released some consultant costs or some consultants, which is also reflected in the less capitalization. And as you say, of course, also the amount capitalized is equal to what we did last year, but coming from a higher base. So that is really because we are also releasing some consultants.

Having said that, we are an innovation company. And I think that's super important, which is also what I tried to elaborate to Simon in the previous questions that were posed there. So, we are seeking for opportunities to invest and maintain our strategic focus of differentiating. We cannot disclose what are those programs. That would be unwise from a competitive position. But our intention is to really pursue our direction.

And back to -- part of your question was also related to bone marrow. We are confident, as report, of course, there are risks, but we are confident that we are getting the CE mark for Europe. We still have investments to do to complete our trials and the work that we do to also enter the U.S., So we're not fully at harbor, so to speak, with the investments related to bone marrow.

The next question comes from Christian Lee from Pareto Securities.

The first one is regarding the instrument sales that declined year-on-year, but your tone remains optimistic and especially for the larger systems. So, should we view this as an indication that demand strength will translate into stronger instrument sales in Q4 already?

I probably defer to sort of be super specific on what happens in Q4. However, I do note that our leading indicators are positive. I do note that Sysmex for the past 2 quarters, so including the quarter they completed, or they reported yesterday, so their Q1 and Q2 equivalent to calendar year Q2, Q3. I do note that they are signaling, or they are reporting instrument growth of 10% in the U.S. and 4% in Europe.

And I think there is a healthy environment. This is also what we see. So, we're positively optimistic. So, you read my tone correctly, but I will defer for being super specific until we've seen what orders we get in and so forth.

Okay. Perfect. And demand for smaller instruments appears a bit softer than for the larger ones. Do you view this as a temporary situation? And what factors do you believe could drive a recovery in the near term?

Yes. No, I think it's temporarily. I think we, together with our partner, has pushed a concept which included both -- for the small labs, which included both the smearing and staining, and our DC-1 instruments. Prior to this, we had very healthy double-digit growth on the DC-1 instrument sold by itself. And then we positioned this instrument package called the DIFF-Line. And it is no secret that we had some operational performance issues with the SmearBox.

So, I truly believe that part of the issue is not the market demand. It's our product issue that we had. And now we do have another simple solution that can substitute. So, it's a matter of getting aligned and getting back and really working with the opportunities as opposed to -- because we have seen a glitch in the pipeline that we built up due to this. But I really trust that it's a temporary thing. The demand is there.

And also, if I look at it, especially in the U.S. All the IHNs are set up for our solution. And I do believe we're the only company who can actually serve that segment in a networked manner, from small labs integrated with the connectivity and our software solution to cater and be managed and decided upon from a diagnostic perspective at the large labs. So, it's temporary, Christian.

Okay. Great. My final question, Reagents performed really well with strong momentum in APAC. Do you see any risk of inventory buildup in the reagents that could dampen sales in the fourth quarter?

No, you're right. I'd say inventory buildup, then I'm thinking specifically around China. And the challenge there when you build up an own manufacturing is that, first of all, the line, we are selling a lot into China, that is then sitting in the manufacturing line. And then after that, you have a layer of 60 to 70 distributors below. So, there is a very little transparency to the end user in China.

So, from that perspective, I would probably answer that, yes, there is a risk of some inventory buildup for the time being because it's very hard to translate how much is actually entering the end users for the time being. So, there's a little bit of risk for that, specifically related to target.

The next question comes from Ludvig Lundgren from Nordea.

So I wanted to continue a bit on this last question with APAC instrument sales. So of course, it was lower in Q3 with some inventory destocking following the large Q2 order. But given that you now have local assembly in China, as I understand it, like will this lead to APAC instruments even more lumpy ahead? It has been lumpy historically as well, but could it be even further enhanced now?

I think the lumpiness is primarily driven for China and not APAC as a whole. So that's for China specifically, I would say. But temporarily, I can certainly not guarantee that there will not be some lumpiness. China -- sorry, APAC has always been quite lumpy and also because China is the biggest market that we serve. However, I do see opportunities both when we look at Japan and when we look at Southeast Asia, not the least in Australia and New Zealand.

So, some lumpiness can occur. And that cannot be sort of neglected, so to speak. But still, I think it's positive that we're actually seeing opportunities both on the instrument side and then also on the reagent side, where we believe there is a good opportunity to actually bundle our offerings because we are the only provider who can actually provide both instrument software and reagents.

Okay. Great. So yes, just a follow-up to that. So, you saw this SEK 3 million reagent sales in APAC in Q3. Like we have seen some spikes in reagent sales historic as well. Like is this to be considered somewhat of a one-off, this level? Or does it rather reflect that you are seeing a significant increase in reagent customers in the region?

No, you're right. It's not a continuous sort of flow. There is lumpiness if you look at the revenue for APAC reagents per se. However, we do believe that the shipments that we send, they go to multiple markets. So, you should see it as a sign of us starting to actually grow the base of RAL reagents being consumed across multiple markets in APAC. I think that's the positive thing.

And then also, we're also working on our logistics setup to serve the reagent market in APAC, which is another driver that can also help us facilitate and provide the reagents. So, you should expect growth, but I cannot guarantee that there will not be this lumpiness because it is a matter of -- it's large shipments that goes when they go and sometimes, they don't go. So that's how you should look at it.

Okay. I understand. Very clear. And then another follow-up. Just like looking at the instrument sales in APAC. So, on a rolling 12-month basis, I guess it has stabilized now around SEK 25 million, SEK 27 million, something like that. Like is this a fair level to extrapolate ahead? Or do you expect this to grow example, looking into '26?

For example, the last part, I didn't hear that.

Yes, for 2026, like do you expect to have a similar type of -- or similar amount of quarterly deliveries on an average level?

Yes. It's always tricky with the average question. I think it's a decent level. Having said that, there are specific opportunities, I'd say that when we look into and we discuss with our partner, there are specific opportunities sitting in APAC that are significant. And if they don't come, then you end up with this relatively flat look. However, the spikes can certainly come because we have some good opportunities across network hospitals, both in Australia, New Zealand, but also in Japan. And if they materialize, then I think we should certainly expect growth when you do your math over the 2026.

Okay. Great. And like -- because I think last year, we saw quite a significant spike in APAC instrument deliveries in Q4. Like is there any seasonal component to that, that customers trying to fill their budgets? Or was that more of a one-off so to say?

We compare that with last year, what I recall was that we had to serve -- we were obligated to serve a specific tender that was 5 years old type of thing. So that happens in the comparable quarter, Q4 last year. I don't expect there to be much -- you can call it seasonality per se. It's more a function of where the specific opportunities materialize rather than seasonality.

Okay. And then final question, like you have talked a bit before about reagent sales in the U.S. and the potential there. Like any updates on that? And if we could start to see this starting to ramp into '26? Or yes, just how to think about that?

Yes. No, I think about it in a way where we've been also at our Capital Market Day when we launched the Power of Focus, we were really emphasizing that MCDh, the methanol-free stain is the enabler to go and penetrate the reagent market in the U.S. That assumption has not changed. But now we've progressed much further. So we're actually able to bring MCDh onto the Sysmex smearing and staining device that is consuming our methanol-free stain. So, I think we've come a long way on the development side.

So now it's about getting some customer feedback on the stain, whether there are any last tweaks for U.S., I do expect it to materialize, let's say, mid-2026, which, of course, means that the contribution from the reagent in 2026 U.S. is not enormously, but milestone-wise and the fact that we start launching this has enormous impact also on how we work with the team over there to actually position our total solution now also including instruments. So, by the end of the day, very exciting times for us.

[Operator Instructions] There are no more questions at this time. So, I hand the conference back to the speakers for any closing comments.

Thank you very much. And first of all, thanks to all of you taking the time to listen in and staying with us throughout the Q&A. In my closure comment, I want to thank especially our strategic partners, the partner organizations all across the regions and the different functions. I really see gradual constant progress here 1.5 year after we especially launched the strategic alliance agreement with the Sysmex Corporation team.

I also, in particular, I want to thank our own team, our staff. It's been extremely probably more than usual a tough quarter, and I think they know what I referred to on the internal lines. However, the dedication and the focus seems to take no ends all across our functions. So really a heartfelt piece of appreciation here.

And then finally, I want to emphasize that on February 5, 2026, this is when we announce and present our year-end bulletin for 2025. So that will be published, and we are looking very much forward to present the results. And with that, I thank you for your attention and your interest in CellaVision. Thank you.