Precise Biometrics AB (publ) (FINGB) Earnings Call Transcript & Summary

All right. Thank you, Joakim, for that update. Another question that came in on the chat here. What is the status of your collaboration with Infineon? And what do you expect from the automotive market in 2024? Will it generate revenue? Or does it already?

So I'm very excited about the automotive industry in general. I think there are a lot of opportunities. I think the cooperation we have with Infineon is important to us but also very dear. They are sincere in their efforts, and they invite us to participate in their activities. We have gotten the opportunity to educate both their partners but also sales. So I think the opportunities we see here forward is joint efforts. We have joint demos at CES, Consumer Electronics Show, here early this year. So a lot of activities, I would say. I feel very positive about some of the cooperation, but I'm also very convinced that we will be able to bring business here during this year. And I see that the possibility for us to actually go commercial here is looking very promising. With that said, we are doing or making revenues from that segment since earlier. But obviously, I hope to be able to increase that here moving forward.

Okay. We have another question that came in here in advance, which regards to your geographical expansion, I guess. You made investments for YOUNiQ in the U.S. and in Europe. Do you see potentially in other markets such as Dubai or the Arab Emirates where large investments are being made in technology and infrastructure right now?

So we will not go sort of with our own sales force in any new markets as of now. So we have the U.S. We are increasing now to the Netherlands and the Benelux, and that is sort of that focused increase. With that said, I know that a partner of us is making business in other parts of the world, including the Middle East. So I wouldn't outrule any installations in that region for that matter. But we will not have any of our own sales in those regions as of today.

Okay. So just in general, is that the strategy going forward to work with resellers and partners for sales in new markets rather than to staff up yourself?

I think it will be a combination. But yes, a lot of that will be driven by partners since that is how we make this scale. But I think that looking at specifically the YOUNiQ businesses, I think that we are really strong in Sweden and the Nordics. And I see that we are now making this effort in the U.S., which is a big step for us. But now moving forward here in Europe, I think it's good to dig where we are in the region. So I think that the Netherlands is a good next step. And then we'll see where we're bringing it from there.

All right. I want to remind everyone that Joakim and Annika are busy and they need to get to investor meetings later today. So if you have a question, feel free to put it in the chat right now. And we're just going to continue with 2 more questions that came in advance otherwise. What is your view on the Smart Card market from a biometric perspective?

Yes. This is a very special market segment, I would say. Historically, Precise Biometrics has spent a lot of effort in that -- both investing in solutions but also in market approach and building sort of the ecosystem around that business. But it has -- to be honest, it has never really taken off. And now it seems like there are new activities, and we are definitely sort of keeping active in that. But I would say, to my opinion, it remains to be seen. I think one of the problems that are in this segment is that the cost for building and manufacturing this kind of cards is still high. So that limits sort of the rate of expansion opportunities. But we are there, we are active, but cautiously following sort of if this is going to happen in big scale or it will eventually be sort of more of a mobile phone payment kind of game.

All right. So I think it's about time to start summing up. And Joakim, what are your views now? You have 2023 behind you, and you mentioned in the report that it's been a tough year, especially on the mobile phone sales market, which has affected Precise. What is the outlook now going forward?

No, I think that 2024 will be better than 2023. I think market-wise, in general, it's still sort of on a sort of challenging path. But I see that 2024 will be a better year for us. I see that the revenues from the mobile phone industry will increase. I can foresee that we will gain more business in some of the new verticals we are addressing. I also see that the growth here for our YOUNiQ businesses, both in Europe and United States will be on a good pace for 2024. So all in all, I'm very optimistic about 2024, and I think we have very good opportunities. And we are gaining new projects as well. So I think all in all, it looks promising.

All right. I think we have time for one more question before we wrap this up. How will you stay competitive in the fingerprint market? And how will Precise benefit from the latest trends [ tech ]?

Yes. So there are 2 parts of this answer, I would say. So one part is that looking at sensors in general, we have a trend that is moving from capacitive sensor to optical sensors and now lately to ultrasonic sensors. And when it comes to the ultrasonic, that is an area where we are world-leading with our algorithm. So basically, what is driving these new sensors is that you -- first of all, you want to have the sensor, the fingerprint sensor in a mobile device under the display. But now the display resolution is becoming higher and higher, which limits the possibility for the optics and reach through. So therefore, the ultrasonic sensors are needed. And again, with our cooperation with, among others, Qualcomm in this space and our sort of position in the ultrasonic algorithm space, I think we have very good opportunities here when that market's really changed now. The other area is within security and safety. I think we see that the -- in society in general, that there is more and more need for biometrics to secure the identity. There's a lot of talk about fake news and fake that and fake that. And I mean at the end of the day, a very safe way to authenticate something, whether that is log-in, payments, access, is using biometrics. And I think that is our offering, and that is where I think we have the big opportunities for our company.

All right. I think that is all the questions that we have today. For those of you who are watching this live and we didn't have time to get to your questions or you came in late, you can always e-mail your questions into the IR inbox at investor@precisebiometrics.com, and someone will get back to you as soon as possible. Thank you for joining us today. Until next time. Have a nice day, and thank you for listening in.

Thank you.