poLight ASA (PLT) Earnings Call Transcript & Summary

Good morning, everybody, and welcome to poLight's First Quarter Presentation 2021. My name is Oyvind Isaksen, I'm the CEO in poLight and together with me today is Alf Henning Bekkevik, CFO. When you ask question, which will be in the end, through the web interface, please leave your contact details so that we can come back to you, if there is no time to answer your question. Okay. Agenda of today, as before key events, introduction to poLight, operational market review, financial review, outlook, and Q&A in the end. Key events for the quarter, we've received an important follow-up order from Honeywell related to the EX30 scan engine. Generally, very good progress in the customer cases, both in the consumer segment, but also in the professional markets. Specifically, I would like to highlight that the positive development we have reported lately, related to smartphone continues, I will come back to that. And, after Q1, we -- and after Easter we received a very, very important and interesting design-win, related to that camera for MAXHUB. Briefly, about poLight. We have developed, and now producing a very, very unique lens -- optical lens, which in a way -- many ways replicate the function of the human eye. This can be used for different products. We started already in 2005, so it's been a long journey. But finally we are starting to see proof of a successful commercialization. We have a strong IP platform. We have 14 worldwide patent families, which is an increase by 1 during the quarter, 10 pending and 3 registered trademarks. Employees, increasing these days, to now we are 28, including the, what we call long-term consultants. And in addition, we have some more shorter-term consultant, which is not counted. Headquarter in beautiful Horten, in Norway, offices in Finland, China, France and representation in Taiwan, Korea and Japan. Shortly, the what are the key attributes of our product, it's an extremely speed, instant focus we can achieve. It's very, very compact, can realize very, very complex system solution. There is a constant field of view, which is a big advantage for many application. And very, very low power consumption. As mentioned, poLight's products and technology platform is well suited for different applications, definitely smartphone and wearable are key markets, as of today. It's a large addressable market. Just taking the smartphone market, which you say give and take 1.5 billion phones per year. There is a one front camera or maybe 2, there are 3 in average back camera, which is making several billion market per year. PoLight can maybe address definitely the front camera and also potentially one of the back camera, having different, roles different cameras, so maybe say 3 billion per year. This is a, obviously estimate. So it's a big market to pick. And the good thing is that camera functionality is really, really emphasized as one of the key features with the phone. In addition, to that market and also including the wearable, we are addressing the barcode more the industrial barcode side. Barcode reading is and direct marking. It's being used in manufacturing. It's a huge potential here. You can also seen some volume from 1D barcode to 2D barcode, meaning that you have to go from laser-based to imaging system. You want to read something close, you want to read something barcode on the far distance, and this needs that we need a very robust and a quick autofocus solution. This is a market we already in through EX30 Honeywell, and we are working with others. Augmented reality, the next big thing, everybody believes, and we are already, as I will come back to, involved in that segment. Other opportunities. I cannot go but in medical. We talk about machine vision, we can talk about web camera, many, many things are coming into us as an opportunity, and we are exploring them step-by-step. Okay. So very important is when the customer do repeat orders. That means that the customer is happy, we are happy and the customers of the customer is happy. So having a follow-up order from EX30 is very important for us. This is a scan engine, which you can see on the bottom right, where we are in the camera on to the right on that scan engine. And this scan engine, Honeywell sells to all OEMs who would like to build a system like a barcode, like the person holding in hat as an example. So this is a scan engine basically of Honeywell. And EX30 is the latest release of this scanner, which they sell to other OEMs. No doubt EX30 design-win and shipping and reference has added a lot of more interest and there are several new and PoCs and projects in that area, and I would say relevant areas. So we will continue to work hard on that market. It's going to sooner or later form a very, very robust basis for the company. One good thing about this market, which I mentioned before, is that the specific product lasts for many, many years, compared to camera phone lasting for 6 to 12 months. Then on the -- an update on the AR side. TLens is considered for Mexican [ ray ] sunglasses by several OEMs as expected before. Again AR market is still at an early stage with low volumes, but it is believed that when form, factor, price is right, this will be a consumer device. We are having key advantages for this kind of application. Power consumption being clearly one of them, speed and compactness and also no gravity sensitivity. These are key attributes of poLight and is a very, very good fit for AR application. What is also nice about this case is that as opposed to smartphone, where we are competing with incumbent technology being there for 10 to 15 years, we are now in an early stage of an industry for which we can take a position already at referenced this [ side ]. We are enrolling cases both for professional use cases, also in potentially consumer use cases. There are 2 projects already defined. Meaning real product -- projects and our 3 PoCs, and some also under plan. Those projects we are involved in have so far, of course not without challenges, but so far it's shows promising results. And even we can see possibility of design-win end of this year or beginning of next half year. This is related to the professional use case. Maybe this is the long-term, the most important consumer market for poLight and TLens. And today, that's not the case because it's more professional use case, but long term, definitely this is -- has a high potential. Smartphone, yes, first add-in project, which we have talked about in several quarterly presentation, has now moved from proof of concept to real projects. We have received a design in confirmation, that is not a design win, but it is a design-in. Meaning they're planning to use poLight and TLens. We start shipping TLens for phone-prototype phase, which also tells us a lot. Testing on component and system levels continues. It will continue still for some time. And related improvement activities is happening. We cannot see today any showstopper from the technical TLens perspective, but obviously other things may stop it, you never know. But the pro -- so promising, we feel that ramp-up is definitely on the planning, already planning material and start starting assemblies. This, we have to do to be prepared, when the opportunity is materializing. The current phone-release plan, it's implying that we need to start shipping from latest Q4 this year. And that's why we are very busy and planning as good as we can. We are -- this is related to a very, very well recognized camera module supplier and definitely a very well recognized OEM, and they are heavily engaged. In some, very good progress, but not a done deal, but we are very, very hopeful, and plan, according to that. In addition to that case, which we have talked a lot about, this design concept has definitely triggered a lot of interest, in the area of front-facing cameras. You can see that tunable optics such as TLens is getting more and more attention from the news. We have now seen new initiatives involving other camera-module suppliers and other OEMs. And I would say it's a small, maybe handful today of other initiatives, which is basically triggered by this design concept, which can realize, as you can see from the right figure, a very, very, very compact solution for selfie camera with autofocus. So it's basically, do not take more space in the screen than a fixed focus camera. And that is really, really, really interesting for many OEMs. So you can add autofocus with no penalty in the screen size. And this is why, not only we, but many have speculating is that this can potentially be the mainstream selfie camera solution. I'm not saying that we will be there alone, but this concept has really, really promising future. I also want to say -- mention that this new add-in design for us and for TLens is also highly relevant for smartwatches and AR. But today, the main focus is smartphone. Then we received a design-win on the webcam. It came for many as a surprise, of course, we have been working on that for some time. It's called MAXHUB, you can see the webpage on the right, where they present the new camera and the new autofocus solution. You can see the statement from MAXHUB in the press release. By adopting TLens technology, it ensures a smoother meeting experience by instant autofocus and we do see several other opportunities for applying the TLens in the future. Nothing is better when a customer is willing to express such a promising statement, and we are very proud of being part of this fantastic web camera, which already have received a lot of good feedback. The Covid-19 situation has definitely changed the way we work and the way we communicate, Web camera is a key element in that aspect. And we do expect, this is a fantastic showcase for getting into other potential cases in the web camera area. Just want to mention that longer-term there is companies working on what they call volumetric video conferencing with -- by basically 3D video conferencing, based on dual camera and light-field imaging. And definitely, we are in some projects, I would say PoCs, demonstrating TLens unique attributes regarding speed and constant field of view, which are making this actually possible. That's for future but we also have to have something for the future. I would say continuing good progress during the quarter, illustrated by this table showing you're planning PoCs, ongoing PoCs, completed PoCs, projects. Project means that then it is a decision that we will use your TLens in a product. PoC is more a technology assessment. Ongoing supply is obviously where we have already signed contract, and we are shipping. So you can see is that we have ongoing supply. We now have 4 as opposed to 3, in the last quarter. There is now 6 projects and 4 for last quarter, the 27 completed PoC, as supposed to 25, and the 25 ongoing PoCs. So still a lot, 1 less than last quarter and there is 11 now planning PoC, and that compared to a 8 last quarter. Very good activity, very good pipeline, maturing month-by-month. Alf Henning, would you help me to go through the financial review?

Sure. Thank you, Oyvind, and good morning to you. Deliveries of TLens and ASICs for commercial use and services and samples for customer development projects gave NOK 1.5 million in revenue in the quarter, compared with NOK 500,000 in the same quarter last year. The EBITDA loss in the quarter was NOK 20 million approximately versus point NOK 16.1 million the same quarter last year. The increased EBITDA loss is mainly due to social security accrued when it comes to the share option plan. That is an effect of that the share price of poLight here have increased in the period. This is offset by reduced operating expenses of NOK 2.2 million. On the balance sheet. Cash position of NOK 68.4 million at the end of the quarter, compared with NOK 50.9 million the same quarter last year. As an effect of the accrued social security on the share option plan, the current liability have raised from NOK 12.9 million in the beginning of the quarter, compared with NOK 23 million at the end of the quarter. And according to current plan, the cash deposits will fund group activities throughout 2021. The cash flow. We started the quarter with NOK 77.2 million in cash deposits. We used NOK 11.2 million in operating activities, compared with NOK 22.2 million in first quarter last year. The reduced cash used is due to a decrease in working capital, and of course the mentioned reduced operating expenses. We also used NOK 200,000 in investing activities, and we received cash from financing activities where of NOK 2.3 million in exercised share options. At the end of the quarter, we had NOK 68.4 million in cash deposits. Okay. Thank you.

Thank you, Alf Henning. So remaining is outlook and Q&A. As we hopefully have managed to illustrate, the progress is continuing, we feel. Smartphone projects progressing, not only one but other initiatives triggered by the very novel add-in design. Barcode follow-up orders, other customer opportunities maturing in several segments, including barcode, and design-win for web camera application after the quarter. Many, many good things are happening for poLight. Definitely, it's important to say that still much to be done, we still have to pick up a lot of revenue over time. But we are building step-by-step, the fundament, which we believe will be a strong fundament for poLight and future-proofing the company. It's also many many challenges which we need to address, in not only the customer-related activity, but the fact that there is -- this is a new company, we are doing things for the first time, we are going -- today we are living in a market where supply chain is really, really challenging to manage due to shortage of capacity component. So the -- there is not lacking challenges, but I feel that we have an organization which are handling those challenges in a very professional and dedicated way. We do intend to improve progress on important long-term initiatives, which is about building a bigger and more global organization, which is about having more competence in certain areas. So we are step-by-step building up and we have during this quarter, employed 3 new in employees. One in Finland and 2 in Taiwan, and more will come in this quarter. The progress we feel, gives definitely a confidence, as I mentioned, that it will be a good story, poLight will be a very good company. Of course, there will be ups and downs, of course there will be challenges, but there -- what we have seen now is that we are building a fundament which we strongly believe in, and which will become a very interesting and profitable company. Alf Henning already mentioned cash position and that will fund us throughout '21. I just wanted to show one more slide, which have been challenged to be more specific on what, when and by many. So we try to illustrate the milestones we have -- we defined on ourself. These are obviously risk factors related to these milestones. There are uncertainties related to these milestones, but hopefully, this is something which should give you a little bit better insight of our plan, and also for us a motivating road map, we would like to execute on. So today, 4 design wins, several projects and PoCs ongoing in different areas. We are targeting as you can understand, our first design-win for smartphone, autofocus selfie camera, towards the end of this year. An extremely important milestone for the company. We have managed to go into wearables, we have managed to go into industrial application, we have managed to go into accessory replication, and now the big volume market today is definitely smartphone. And it's extremely important that we get into that. So that would be -- mean a lot for cost optimization of the product and organization. That we target to happen this year -- end of this year. We also target to have a design-win for AR. It could happen at the end of this year, it could happen first half next year. As you understand exact dates and months and quarters are incredibly difficult for us to be precise on. So that's -- you have to look at this as a indication. We also target the first design-win in medical, in '22, maybe end of the year. That's related to a disposable endoscope, very interesting market. Then we are working on some new concepts, being optical image stabilization, for AR as an example, super important, and also for telephoto folded camera, extremely important. And we have a extremely nice concept, which we are working on. Also big aperture TLens, we are working on. As you know, we have a -- as you call it the MOU project, which is addressing that topic, but we also do internal activity. Beam steering is another area which we, together with all the partners are working on. So there will be new products coming out of -- based on our IP. That will, we feel, be a good basis for -- also be included in the back camera structure. We have set that together, that will be 2024. Can it be 2023, can it be based on existing product? Difficult to say, but we have put it as a target in 2024, based on the launch of new functionality. Then we are also feeling that there will be a AR consumer product, which will be different, which would be significantly different in volume. And we, through the design-win in the enterprise market, AR, we do expect that consumer-based AR will happen around that 2025, little bit before, little bit after, I don't know. That will be a extremely important milestone for the company to achieve that. So those are -- and our other come of milestones are repeat orders in other segments, probably also come new segments that -- but I would say that this is the most visible things and most, I would say, important milestone we can envisage, as we see it today. Having said, definitely uncertain related to that, but that's what we look at every night before we go to bed, and every morning, we eat breakfast. Financial ambitions, as uncertain, but nice to have a target. Smartphone revenue will start this year, hopefully. We will ramp-up throughout the year and into 2023. If we have first design-win, the first shipment of the first phone is successful, listening to the interest around us regarding this, that can be a steep ramp which in itself will -- can be very challenging. A nice challenge though, to have. EBITDA breakeven at '23, maybe even if we are good, we can even be profitable. We have an ambition of NOK 100 million say. We could say a different number, but NOK 100 million is a nice number. In 2025 with an EBITDA in around 20% plus. And, as I mentioned before, barcode expected to covering a, or I would say industrial application, expecting to be covering a significant part of the operating cost of the company. Okay. I hope that gave a little bit flavor of what we are achieving and working hard to manage and achieve. Then, I will invite Alf Henning to join me for the Q&A. So as I mentioned, if you ask questions on the web, please leave your contact details. But it's not given that we are able to answer all live, but we will try to get back to you.

Okay. Are you ready?

I am ready, Alf.

Good. Does TLens have similar issues with regards to noise induced affecting radio frequencies or order sensitive components in for instance, mobile or AR?

A little bit uncertain, similar issues what that's referring to. But what I can say is that TLens, compared to say VCM, TLens do not have any coils, do not have any magnets, so in that respect -- and this is also something we are emphasizing a lot, that we are not making that kind of noise in the area of the phone, which is a very sensitive area, the antennas, the microphones. And that area, we are actually very silent technology, I would say, and compared to others, I would say significantly less of an issue for TLens than others.

Can you say something about how many OEMs that have shown interest in and are considering the add-in concept?

Yes. As I mentioned during the presentation, if you take OEMs/camera module vendors, I would say it's a small handful which has added to that interest list recently.

How many of your projects are related to smartphones?

We have projects. Then it's -- then how we define projects is a project where we already have a project doing something for a particular phone, in this case. And that is so far, that's one project, which I showed you on the table. There's one project on the consumer, the other one was the webcam, which is moved to shipment, that is actually one smartphone project, that means that there are more PoCs of course.

Regarding TLens and add-in design, have you or the OEMs found new advantages or disadvantages in test models, compared to using a normal VCM?

Not, I would say not new. There are plus or minus of VCM and TLens. I think when, now we see a lot of interest in this over technology. It's obviously because in some, they at the moment feel that some of attributes we can give the end user, is better than VCM, for that function. But I think it's very important that we are on our toes, because take -- there are other tunable technology, there are VCM and there are many, many VCM players, and they will definitely do everything they can to get back also into that part of the phone. So I think we just need to work very hard to show performance and to show advantages. One of the advantages, which we have, which is not necessarily very easy to achieve with all the technologies, is that you take a selfie as an example, due to our speed, due to our field of view is constant, we take a burst of images, we can combine those images very quickly, because of constant field of view and you have everything in focus, as we have shown you. That is not easy to achieve with if not having a similar technology to TLens. So we need to innovate user experiences, use application, which then will put a priority on continuing using TLens for that application.

What are your personal thoughts about the term mainstream, that you have mentioned that the add-in has the opportunity become in the smartphone market.

What I mean is that -- and not only me, but what we have been discussing with our ecosystem, is that this shows promising result at the moment. We are moving towards a real projects, and if we are successful, if we are good, if we deliver quality, if we can continue innovation, continue improvement, which is important in this dynamic industry, I think we can be a very, very, I would say preferred solution. It's not given, but there is an opportunity here and we intend to grab that opportunity. And that's why we say mainstream, because today it seems to be a very preferred option at the moment, as I said. But we cannot relax. We need to continue push, continue to innovate and we need to be able to supply. So still many boxes to be ticked, but we see an opportunity, which is extremely motivating and not only us, but also people, customer we're talking to.

Add-in at the moment, do you work with TLens under or on the top of the phone screen?

On the top -- I guess you mean through the screen. Today the normal configuration on a selfie camera is that there is a hole in the screen, which is not a display. And that's where the normal implementation today, and that's what we are involved in the project, we are talking about and the projects we are talking about. We can also fit an under-the-screen implementation. I think that the most challenge there, is probably their -- the quality, because if everything is the screen and we're going to shoot -- have a camera shooting through that screen, optical quality is not trivial to achieve. So in a way, that's not a TLens problem, but it's more like a optical quality through the screen problem. So we are today under the screen, sorry, a through the screen, but can also be under the screen design.

Is poLight the only player with tunable lenses that fits a selfie camera?

Okay. Today, we don't -- we are not aware of many other opportunities, but of course there are other tunable technologies. There are the liquid lenses and the various type of liquid lenses, which I'm sure also are being considered. This system -- this ecosystem do not like companies to have a single source situation. So they will definitely strive towards having alternatives, definitely. And that includes VCM. But I think that -- we feel that TLens is probably one of the easiest technologies to integrate in such a scheme, that we feel, that's a subjective statement. But still, that's what how we see the world today. We have a good chance.

Has Android facilitated the use of TLens and similar lenses, for ins -- for example, all in focus? Or does OEM or poLight need to develop a custom camera app?

When it comes to achieving the autofocus function, the Android -- we -- basically our customer is using the standard Android contrast based focusing technology. Can be done smarter and faster, but that's what used and that works well. When it comes to all in focus or bokeh or stuff like that, that will be a third-party software, which the OEM needs to implement to achieve.

It seems that several OEMs use the term TLens technology, when using TLens. Is this something poLight has decided?

No. PoLight's trademark is as you know is, capital T, capital L e-n-s, that's how we write it, with capital T and capital L. And there are various ways of -- even internally, we are cheating sometimes, but that's our trademark, and we are not telling anybody to write it differently.

Does your partner J2C plan to extend their market for Iris camera, with TLens, towards the mobile segment? And would that be possible to implement in an under-the-screen solution?

J2C is a Korean company which we have been supplying components to. An innovative company doing interesting things. What they plan to do -- I should be careful answering to that, I think it's better that you approach J2C with that question. But on a more, I would say general -- I would say generally speaking, I think that, yes, why shouldn't they? I don't know what they're doing but of course they could do. But please, address that to J2C.

How are the opportunities for more products from Honeywell in 2021?

In 2021, I don't -- this is a very slow-moving industry. They took years to finally decide and release the EX30. Thee way we understand it, Honeywell is supportive, and would like to continue to evolve the new solution based on also TLens. And I'm sure they are also considering other technologies, but they definitely have stated that they would like to continue the cooperation using TLens for other products. But that's not going to happen in '21. EX30 going to live for 5 plus or minus years.

We did design-win in the web camera brand MAXHUB. Do you expect to see more design-wins in this segment for the future? And why did MAXHUB decide to choose TLens?

Why? I think I read the statement from the Vice President for MAXHUB in my presentation. So that's obviously speed, smoothness and no field of view pumping, so that's why. I think, definitely it was an important design-win, because of the reference it's represent. And now people can buy this camera soon, I hope. And it's used together with Teams, compatible with Teams. It will be used with different settings and of course we will use that case for whatever it's worth to demonstrate the advantage of using TLens. So yes, hopefully, this would be a stepping stone towards more of such application, but there is today, nothing in the -- concrete in the pipeline, which I also mentioned in the last call -- last time I talked about it. Okay?

How is the new partnership with Brighterwave received by potential customers? Is there any interest around this now, and what kind of opportunities have poLight in this partnership?

Brighterwave is a small Finnish innovative team, which we have been working with for a long time, and we are having a good cooperation. We have -- we are -- we have sent some patent application and we have some joint presentation, and they have a very good laser competence. I think I can see several application coming out of that cooperation. It could be laser tuning in AOL, it could be Lidar, it could be many things. And I think that -- but still, I would say it is an early stage in this advanced R&D stage and it's too early to talk about customers concrete. So I think it's -- we need to come back to that, but it's an interesting technology and in combination can realize many interesting concepts.

Can you tell us more about production capacity at this moment?

At this moment, we are obviously using all our efforts to plan for the ramp-up for the coming, hopefully smartphone project. Luckily, and I say luckily, we have been foresighted and we have built quite some inventory in -- on the wafer level, and we are also -- have started to prepare a second source on the assembly side. So that's our main focus, be able to supply to that smartphone case, starting shipping end of this year, and we have also placed additional POs on STMicro to secure that and to secure us into 2022. What we have said before, and stepping back, over supply chain is producing the lens material, which we do in headquarter Horten. One liter polymer can serve one million lenses, give and take. No capacity limitation at all. Then we go to ST to buy the eye muscles, the membrane which we bend. That is definitely a different ballgame and certainly at the moment. What we said historically is that we have already installed a capacity of around say 1.8 million to 1 million lenses membranes per month. That of course is given that we have supplied material into the fab. So we are now starting more on a regular basis to fill that fab, so that they are already running. But today the lead time can be really, really high, in enormous situation maybe say 3/4 months, but today it's much longer. But luckily, we have planned for material and we have good shape for the coming projects. Assembly wise, we are now building up a second source. We have 2 sources. We have also said that with one source, we can do say between 500,000 and 800,000 per month, so doubling that. It's obviously needed to ramp-up at the level we are planning.

New production partners have been mentioned. Can you tell us more about this?

I'd say, it is production partner in which we have before was using the fab in Taiwan, which is now moving or have moved the manufacturing to the Philippines, same company, so that's -- it is an re-qualification there. And then we have also found a -- worked for a couple of years now with a new manufacturing partner in Taiwan. So then we have one in Philippines and one in Taiwan, and we intend to keep both busy.

Xiaomi Mi mixed phone were released with liquid lens from NEXTLENS. The reviews were not impressed by the image quality. We know about all the good properties with TLens. How is the TLens when comparing image quality with the best VCM cameras?

Okay. Yes, regarding the Xiaomi review, I haven't seen that, but that will be interesting, of course if somebody can send me that link, showing that review. But on a -- on share -- on that phone -- that is the liquid lens, and in a way by design that is causing some potential issues on image quality. That's physics. And there are also some of the liquid technology do not enable AR coating. AR coating is a coating you add to the lens to optimize the optical performance. For some of the liquid technology that's not easy/possible to do. For TLens, it is -- and already included, and then you can add coating on the TLens to make even better. So that's on that side, but on the VCM side, it's a long answer. But what I can say that VCM is -- has been optimized for 10, 15, 20 years. It's a good technology, no doubt about it, but it lacks compactness, it lacks speed, it lacks constant field of view, it lacks not being magnetic and what have you. But what they do is, as you know, they move lens stack up and down to change focus, slow, mechanical movements. What we do is that we bend a small membrane to change the focus. Quick, low power consumption, no magnetic nerves etc., etc. That bending will imply that there will be, what you call a field curvature effect, which you will see in the corner of the image in a lab, if you take an image, very, very close to the phone. So that's in a way a disadvantage of any tunable optics by design. So that's, you can say is a negative thing compared to VCM, but I would say more positive things as I've been mentioning. And then, I think that back to the field curvature, which you can maybe see as a negative thing, the field curvature can be compensated using the TLens by taking a burst of images, combine all images and everything will be in focus. So field curvature will go back. But plus and minus. And maybe the biggest plus for VCM is the market position they have, and the maturity they have. That's probably the biggest advantage of VCM. But we are going to go there. But, having said that, VCM will exist for many, many, many years and maybe forever, for always. But there will be other technologies coming in and coexisting with VCM.

How does the MOR, sorry, MOU project stand now?

It's progressing, not super fast. This quarter, this is the project with a camera module supplier, where we are testing a concept for a bigger aperture TLens, which I mentioned in -- earlier in the presentation. So it was around NOK 700,000 progress, I was handling during the quarter. So yes, progressing, but still things to be done. And it is not on the highest priority, because of natural reasons, but very interesting concept, which we will walk through.

We see some phones come with 2 selfie cameras. Do you know if there have been built any test phones with more than one TLens in phone camera? If so, do you know how that testing went?

No. As far as we know, obviously, we don't know everything, but as far as we know, there is not been built or planned dual front camera. You saw dual camera more often before than now, to be honest. But as I mentioned, volumetric video conferencing having 2 cameras -- still cameras with TLens will be very, very interesting application, which may trigger that trend again. Let's see. It's not happening tomorrow, but it is showing some interest. The world is 3D, and I think more and more will become 3D. And TLens is a fantastic application for such compact 3D solutions, due to speed and constant field of view.

We saw that MAXHUB referred TLens saying, TLens Focus. Can you confirm or not if OnePlus is talking about poLight's TLens when they talk about new TLens technology for lightening fast focus in their new models?

What I can say that MAXHUB did write TLens wrongly in the first release. They have updated their webpage in all the right TLens, as we recommended, with an R, even in the back. What -- related to OnePlus, I can only relate you to talking to OnePlus, because we cannot comment on OnePlus's press releases.

Is there any movement regarding the competitors in the market? Are there any new competitors, or have some of the existing competitors strengthened their place in the market? Are poLight still a strong as earlier?

I feel if you refer to this quarter, I would say that poLight's position has been strengthened significantly. New design-wins, repeat order, progress on the smartphone, design in commitment, shipping to prototype phone. So I can only say that I feel -- we feel that our position has strengthened during the quarter. Obviously, you can't only review competition over a quarter, but there is competition, and there will be competition. But I think we will manage quite well in that competition. The biggest competition we have today is VCM.

And what do you think about our share split?

Yes. We have done that historically, but no, we have no plans for that. The liquidity and the retail activity in this year is relatively good. So currently there is no plan for doing that, because that could be a motivation, of course. But as we see today, there is not a urgent need to do that. So no current plans on that.

Can you make an assumption of a high-volume case? How much time does poLight need to provide the OEM finished lenses?

It's very difficult to give one answer because it depends very much what we have ramped up to inventory. But I would say in a normal situation, in a normal world, which we do not have today, there will be maybe a, say a couple of months of -- maybe 3 months of lead time. But that's not the case today. That's why we have taken commitment long time ago material to achieve what we are doing now, hopefully, with the upcoming smartphone project.

Have you had been contemplating additional financing to be able to cope with more projects, etc., and aim for building an even larger company and faster?

As we mentioned several times and -- is that the Board and management are constantly, continuously evaluating a need for financing, we are keeping a very, very close eye on the cash we have. Being a solid well-financed company is also very important for our customer. So the -- what I can say is that this is something which is constantly considered.

Many opportunities for your TLens. But as a small company, you obviously have limited resources. Have you declined project leads from partners due to limited capacity? Please elaborate on how you prioritize.

Yes. We have been invited into some relatively long-term things, which we feel will take our focus too much. So that happens, it doesn't happen often I have to say, but yes we have cases there. The priority is simple. The priority is getting a design-win in smartphone. That is the priority, and that we will achieve and work extremely hard to achieve. And then there -- then we obviously have defined other areas, industrial like barcode, medical like endoscope, AR, VR. So all of those are getting also a fair share of the activity. But I would say smartphone and this add-in type concept has -- took a lot of our resources in the last, I would say, year. But we are also obviously making sure that our customer and projects in industrial, medical, AR is being treated in a good way and hopefully will lead to design-wins in not too long future.

How do you judge NEXTLENS as a competitor, or even some want to cooperate with?

NEXTLENS has done -- NEXTLENS I guess is an organization which is taking Optotune technology, maybe into smartphone. I'm not fully aware of the strategy there. But yes, I think NEXTLENS or Optotune will coexist. They have been -- done a very good job in the industrial area, and they are cooperating also with partners in the smartphone area. So I think it will be -- I think those technology will coexist. Sometimes we are a better fit and sometimes they are better fit.

Is there a difference in the OEMs with swiftness on decision making? Are some moving faster than others?

Yes, a good question. Typically, big organization more processes, more box to tick-off, but -- and smaller can move faster. So yes, there is a big difference. Big organization, qualified technology, write report, put technology into the available technology closet. Then when somebody, product management need something, they go into that closet and look at what kind of technology has R&D qualified, and then they use that technology, maybe. Whereas, in a way, other small companies would find; okay, TLens, yes, that could be very good for our web camera. And they start in a way not a generic PoC, but as more stock directly on the project, and then move faster. So yes, there is a difference.

Now when do you have shipped a fair number of TLens, and you say -- can you say something about the yield quality, levels, returns, etc.?

What I can say is that, we will have yield -- we have clear evidence that we will have years above 90, high 90s. That's what we see. But yield will always -- that kind of yield will generate -- will be achievable when you over time ship volumes. It's not achievable when you turn on and off. In fact, it's not possible when you have low volumes.

Can you comment on how, when and on what level additional financing will be made?

No comments to that. Just saying that we continuously are evaluating when to do what.

Road map; will it be really, really take until 2025 for deign-in for glasses?

No. I didn't say that. I said that I expect that consumer-driven AR glasses is fur later. We are involved in a project with a known well-recognized OEM, which is thinking about consumer as the base case. But that is shipping -- plan shipping relatively late. The first design-win with AR glasses will be a professional use case, being doctors, being industrial applications. And that will come first, and then the consumer market. When formed fit factor for the glasses, when cost is coming down, it's become a consumer market. That, is it '25, is it '24, is it '26? I don't know, but later. And that's why we say we are differentiating design-win on AR for professional and AR for consumer. Where it is in time, I don't know, but we put it in '25, maybe '24 o '26.

And there is a question about interference. Patents and other OEMs and smartphone vendors show concepts to decrease interference from the switching from [indiscernible] due to fast steering, voltage switching?

The driver the TLens have doesn't create noise. But of course, there is a driver of the TLens which is an ASIC, which has to be designed properly to not making too much noise when it comes to EMI, ESD, and that design we have.

Larger tunable lenses may need high-voltages, and may be more affected by gravitation. Does poLight have any solutions for these problems?

Yes, we don't have gravitation effects at all. A liquid technology will definitely have, and that's one of the disadvantage. And so clearly one of our, I would say, big advantage. And then the question about voltage, what was that? Okay.

It was it needs more voltage if it's larger.

Yes. We have a driver, which can go up to around 50 volts. And that's what we need to get to have the optical power we need. That's a quite high voltage, but we haven't seen any issues with that, in implementing that technology. So maybe I misunderstand the question then please, if I did, give me -- send me mail and I will try to answer better. We are getting close to stopping Alf Henning. Is there still anymore questions?

Yes, there are more questions, I guess there's only one.

Okay.

So the last one. You stated barcode revenue will cover a substantial part of the total of [ wealth ] in 2025. Does that indicate lower price in high-volume sales or does it indicate a huge upside in revenue when adding high-volume markets?

Barcode is typically an area we typically ship low volumes, but at a different pricing. And that's what we call a high-margin, low-volume business. Whereas, say the smartphone market will typically be the high-volume, lower margin. So that's the combination we try to make in the company, is to have some steady, long-term good projects -- products, shipping steadily over years, same products at low volumes, but relative good margin. And then we have the consumer on top, which is cream on the cake. Okay.

That was the last one if [indiscernible] we have one last minute.

Then, we have to be quick.

Earlier, it was said that the smartphone release with TLens was expected early 2021. What was -- what has happened since it's delayed with almost one year?

That statement I can't recall, to be honest. At least the last quarters we have not been talked about early '21, but can be an old statement. Sorry for that. I can't recall that statement so please send me a mail and I will try to clarify it there. What we say today, what we see today, is that there is a very good opportunity to have -- to be a part of a smartphone release, which will be released in the beginning of '22 and we need to start shipping in Q4 2021. Okay. Fantastic. I feel this presentation is over. Next event is Annual General Meeting on the 26th of May, Q2 28th August, 2021. Between now and then, we hope that we have a significant progress to report. Thank you for participating and particular thank you to all of you who are digging and digging and digging and sending in questions and sending me SMSs and mails. I like it very much. I feel that it's very motivating to see so many people be so interested in the poLight and the technology, and I think that we owe you a lot for that interest. Thanks a lot. Enjoy the weekend, when it comes. See you next time. Thank you.

Thank you.