Smartoptics : Q1 2024 – Smartoptics Financial Presentation

Financial Presentation

Q1 2024

May 8, 2024

Q1'24 Continued investments for growth and strong cash flow

REVENUE

2024Change

Q1

12.6 MUSD

-10.2%

GROSS MARGIN

20242023

Q1

48.6%

50.7%

EBITDA MARGIN

20242023

Q1

8.4%

18.5%

Revenue drop caused by challenging market conditions in EMEA.

Continued investments for growth. Investments in products, organization and selected markets prioritized

Growth in Americas and continued strong cash flow

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Drivers for revenue growth acceleration

Progress on		Very high	New product
large account		activity level in	portfolio
strategy		Americas	progressing
			nicely
• First order from larger	•	Significant growth in	• 34 Degree ROADM on
US regional operator		qualified leads YoY	track to be released in Q2
• Agreement with global	•	Meaningful contribution	• More relevant in regional
cloud operator (presence		from LATAM	networks
in >800 datacenters)			• Larger projects and deals

First sign of AI traffic demands as a growth driver

• AI as a service being rolled out in larger scale across USA
• Expected to result in increased traffic

3

Smartoptics in brief

4

Optimizing the usage of optical fiber

We increase bandwidth by allowing data streams at different frequencies to be sent over a single optical fiber network

Enabled by Wavelength Division Multiplexing (WDM), which allows multiple traffic signals to be transported over the same fiber, maximizing the usefulness of fiber and helps optimize network investments.

SMARTOPTICS IN BRIEF

Founded in 2006	Scandinavian company	110+ employees
	headquartered in Oslo, Norway

Smart design principles

An open approach

Ambitious growth aspirations

Sustainable solutions

Listed on Euronext Growth	150+ business partners
Oslo in 2021

BROADBAND	ENTREPRISE	COMMUNICATION	CONTENT PROVIDERS
PROVIDERS	DATA CENTERS	SERVICE PROVIDERS	& INTERNET EXCHANGES

5

A reliable and competitive offering targeting a wide range of network applications

OUR EDGE

We stand out by offering cost-efficientsolutions, leading the transition to modern and open networks with focus on ease of use with no ties to legacy technology

TECHNOLOGY

Our solutions are designed by a world class team using best of bread merchant technology and modern software design principles, allowing a flexible approach and minimal time-to-market.

6

The market for fiber optical network equipment is worth 16 billion USD worldwide

16 billion USD	Key driver is
world market	data growth
• 50% is Metro	•	Cloud migration & new data centers
• 50% is EMEA and North America	•	Migration to 400Gbit/s
	•	5G roll-out
	• Fiber access roll-out
	•	Government funding
	•	Emerging: AI/ML

Open and disaggregated solutions

• Shift toward more cost-efficient networks
• IP over DWDM

Smartoptics addressable market is 4-5 billion USD

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Q1'24 deep dive

8

Positive development in Americas curbed by lower activity in EMEA

Revenue per region and quarter - Last 5 quarters

MUSD
	Americas		EMEA		APAC
			-25%
	+6%		8.5
7.7
7.5		7.3
	6.8	6.4
6.1		6.0
			5.5
				5.3

												+8%
										0.7	0.7	0.9	1.0	0.7
Q1	Q2	Q3	Q4	Q1	Q1	Q2	Q3	Q4	Q1	Q1	Q2	Q3	Q4		Q1
	2023			2024			2023		2024			2023		2024

9

Healthy growth in Software & Services and Devices

Revenue per business area and quarter - Last 5 quarters

MUSD

		Solutions						Devices						Software & Services
	10.6	-24%
8.8			8.4
		7.8
				6.7				+8%
							4.7
							4.3		4.1
						3.8
								3.6
														+22%
												1.5	1.8	1.5	1.8	1.8
Q1	Q2	Q3	Q4	Q1	Q1	Q2	Q3	Q4	Q1	Q1	Q2	Q3	Q4		Q1
		2023		2024			2023		2024			2023		2024

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