Earnings call transcript: AutoStore’s Q2 2025 sees revenue dip, order intake grows

AutoStore Holdings Ltd reported its Q2 2025 earnings, revealing a mixed performance with a notable decrease in revenue year-over-year despite a sequential increase. The company also demonstrated strength in order intake and operational efficiency. According to InvestingPro data, AutoStore currently trades at $11.03, with analysis suggesting the stock is fairly valued based on fundamental factors. With a market capitalization of $9.6 billion, the company maintains its position as a significant player in the automated storage solutions market.

Key Takeaways

• Q2 revenue decreased by 13% year-over-year but increased by 56% sequentially.
• Order intake rose by 6% both sequentially and year-over-year, reaching $150 million.
• Gross margin was impacted by an inventory write-down but is expected to stabilize.
• Europe accounted for 70% of revenue, with positive signs in North America.
• The company phased out its B1 robot line, incurring an $8.5 million write-down.

Company Performance

AutoStore’s performance in Q2 2025 was characterized by a significant sequential revenue increase, although it was down compared to the same period last year. The company continues to lead in cubic storage space, with a strong foothold in Europe and emerging positive indicators in North America. The industrial and healthcare segments showed robust growth, while e-commerce and retail markets improved. InvestingPro analysis reveals the company maintains impressive gross profit margins of 79% and an excellent financial health score, with 12 additional ProTips available to subscribers.

Financial Highlights

• Revenue: $134 million, up 56% sequentially, down 13% year-over-year.
• Gross Margin: 69%, or 75% excluding the B1 robot write-down.
• Adjusted EBITDA Margin: 48%.
• Order Intake: $150 million, up 6% sequentially and year-over-year.
• Order Backlog: $529 million, a 3% sequential increase.

Outlook & Guidance

AutoStore is focused on optimizing its product offerings and expanding its "AutoStore as a Service" model. The company anticipates market stabilization and is preparing for a product release in October. Future revenue forecasts for FY2026 and FY2027 are set at $854.24 million and $916.95 million, respectively, with EPS forecasts of $0.48 and $0.52. With a P/E ratio of 25.57 and a five-year revenue CAGR of 10%, investors seeking deeper insights can access comprehensive analysis and valuation metrics through InvestingPro’s detailed research reports, available for over 1,400 US stocks.

Executive Commentary

CEO Mats Blanwyckse emphasized the company’s position in an underpenetrated market, driven by long-term trends. He stated, "Innovation is embedded in our DNA." CFO Paul Harrison highlighted the company’s standardized products and asset ownership, reinforcing their strategic direction.

Risks and Challenges

• Potential market saturation could limit growth in key segments.
• Macroeconomic pressures might affect consumer spending and industrial investments.
• Supply chain disruptions could impact production and delivery timelines.
• The transition from the B1 robot line might affect short-term operational efficiency.

AutoStore’s Q2 2025 earnings call showcased a company navigating challenges with strategic shifts and a focus on innovation, positioning itself for future growth amidst a dynamic market landscape.

Full transcript - AutoStore Holdings Ltd (AUTO) Q2 2025:

Silva Flocher, Investor Relations Officer, Autostor: My name is Silva Flocher, and I’m the Investor Relations Officer at Autostor. Our CEO, Matza Blanwyckse, and our CFO, Paul Harrison, are standing ready to talk to you about this quarter and subsequently answer any questions you have. I’ll be moderating today’s session. As usual, we would like to remind you of the disclaimer in regards to forward looking statements.

It can be read here at your own convenience. Moving on to our agenda. Mats will begin with an overview of the operational performance and strategic progress. Paul will then follow-up with presenting the financial results in more detail. We’ll follow-up with a live q and a session and you can submit your written questions in the webcast player or raise your hand in the Microsoft Teams to ask questions directly.

The link to the Microsoft Teams meeting is available on our website and an invitation that we published a couple of weeks ago. After the Q and A, Mats will round off with some final remarks. And as a reminder, all our figures are stated in US dollars. So let’s get started. Matt, over to you.

Mats Blanwyckse, CEO, Autostor: Thank you, Eva and good morning. When I last spoke with you, we were at the peak of market uncertainty. Q1 had been volatile and that uncertainty also continued into Q2. But as the quarter progressed, we were able to identify and utilize some pockets of resilience. First, we doubled down on the opportunity that lies within our customer base, which accounted for around 60% of our revenues in the quarter.

Secondly, Europe continued to be strong, representing 70% of revenue. Thirdly, we also see early positive signs with regards to demand in North America reflected in order intake, but not fully in revenue. As we’ve talked about before, we strive to be closer to deals and customers and the development in second quarter shows that this is producing positive results. Q2 revenue was $134,000,000 which is up 56% sequentially, marking a recovery from the unusually soft Q1. However, compared to the same period last year, revenue was down 13% and this shows that caution and hesitation still exist, which is fully understandable given the uncertain and volatile market backdrop.

But in this market and with the actions that we’ve taken, order intake was SEK150 million in the quarter. This represents a 6% increase both sequentially and year over year. And adjusting for the currency tailwinds, the development is roughly flat. What we’re seeing so far in the third quarter are similar market dynamics in general, but I’m happy to see how we’re able to stay even closer to our customers and the opportunities that are out there. So, moving to profitability, our gross margin was 69% and included in this number is the $8,500,000 write down tied to the V1 robot.

If we exclude for that, the gross margin was 75%. For adjusted EBITDA margin, we report 48%, which is back to our historical levels and Paul will come more back to this later. So if we move on to key developments in our business, you will see that during the quarter we signed another contract with our orders or as a service model and this time with the European 3PL. And while still early days, this model is coming up in more and more conversations and as we’ve talked about before, it’s a model that resonates particularly well in the 3PL market. So far in 2025, we’ve shipped products to secure €34,000,000 future as a service revenue.

Looking ahead, we’re preparing for our fall product release, which will include both software and hardware updates and it will be an exciting step forward, so stay tuned for more details soon. So looking at it, think these results reflect not only our operational execution, but also us making progress on our strategy, which I’ll now walk you through. And our foundation is strong. We’ve built this platform with a large customer base across a wide variety of end markets and system types with a high degree of repeat purchases. Our technology is leading and our solution is highly competitive with a strong ROI.

And with changing market dynamics, we have taken action and we’ve realized $10,000,000 of annualized cost savings and we’ve reallocated investments towards high growth initiatives. Looking further out, we’re focused around three themes. Firstly, we have a product strategy that sees us continuing to optimize and expand our core, increasing our addressable market through adding new capabilities and further developing the Autosor software platform. Against this, we’re making good progress. In under twelve months, we’ve launched 10 new products and features and we can now do thousands of robots in the site versus hundreds a few years ago.

And we’re also seeing strong adoption of our Essential Software Package, which offers the complete suite of software with smart routing, real time analytics and intelligent reporting. And with another major release planned in October, we’re continuing to improve our offering and increase our market opportunity. Secondly, under our new commercial strategy, we have sharpened our go to market focus and reallocated resources towards high potential areas. And this shift is already paying off. Since our Capital Markets Day in September 2024, we’ve added around 100 new logos, including several strategic accounts with long term potential fueling our land and expand strategy.

At the same time, deeper engagement across that installed base is supporting higher account penetration and reinforcing a customer first approach, which is leading now to 60% of orders this quarter coming from existing customers. And then enabled by these two growth engines, we’re broadening our recurring revenue streams from both software as well as these new flexible solutions such as PO and more recently Autostra as a Service. And we see these solutions appealing to customers we would otherwise not plan and they also create more visibility and stronger customer intimacy. But now let’s take a step back and this familiar slide is a good visualization of that strong foundation that I just talked about and it highlights our strong value proposition to customers, our long term competitive strength and our superior financial profile. It summarizes the strength of our platform and why we’re so uniquely positioned to lead.

We have now delivered seventeen fifty systems with 79,500 robots in 60 countries. We have a total of 1,200 unique customers and within the Cubic Storage space, we’re the only player with such a significant installed base providing us with great advantages. And not only does this speak to the strength of our solutions, it also represents substantial base for our land and expand strategy. And this is a slide that you’re also familiar with. And here we can see a small selection of our over 1,200 customers and as you can see, we have a broad customer portfolio across a diverse set of end markets.

Around half of our revenues come from existing customers and this growing customer base represents a massive opportunity. It is also worth noting that Europe remains our largest region, representing over two thirds of our business. And then during the last few quarters, we’ve seen B2B segments like Industrials and Healthcare stay strong, but we’ve also seen leading indicators improve across e comm and retail segments. And I always like to give the last words to our customers. You’ve heard me talk about evolving how we work with strategic accounts and 3PLs.

And today we’re highlighting Rines, a global logistics service provider operating in over 70 countries with thirteen thirty sites. And RENAS runs a high throughput site with Oddosor in Germany. And as you will hear, Oddosor is a key part of their future strategy, thanks to the flexible and standardized approach we can offer. So, before Paul takes us through the financials of this quarter, please have a look at this.

Customer Representative, Renus: Greenus is a global logistics service provider and a family owned company. We operate in more than 70 countries, 1,330 sites. We have 41,000 employees and achieved last year 8,200,000,000.0 of turnover.

Customer Representative, Renus: Reynolds as a significant player in the logistics market is a long lasting partner of Talia. We operate more than 500 stores in these three markets and ecom business.

Customer Representative, Renus: We designed a wonderful warehouse that is scalable and evolves with the ambitious growth targets of our customer. We implemented an out of store system with 240,000 bin locations at the site of round about 8,000 square meter. This is really one of the out of store systems with the highest throughput worldwide.

Customer Representative, Renus: As typical for an Autostor system, it operates with a very high availability, which is of course very important and crucial for Renus to fulfill their customer expectations.

Customer Representative, Renus: We have quite some cost reductions due to the high density and storage as well in the throughput. And it is a very easy and robust solution which we can easily scale and really elevates our service levels.

Customer Representative, Renus: We doubled productivity, reduced our employee training times by 75%, enables us to ramp up and scale up faster for peak season. And regarding storage quality, we made a step forward too.

Customer Representative, Renus: The outer store system is a central component in our future warehouse approach. There we combine standardized technology in a customer tailored solution where we are able fulfill customer needs not only for books, for many other goods.

Paul Harrison, CFO, Autostor: Thank you, Mats, for that and good morning. Okay, let’s move on to the financial highlights on the next slide. As Matt shared earlier, this quarter reflects clear strategic progress. This slide summarizes our q two financial performance. Revenue came in at 134,000,000.

Our gross margin was 69% which while still strong reflects the write down of inventory related to the b one business line. Excluding this, gross margin would be 75 percent. Our adjusted EBITDA margin came in at 48%, order intake came in at a 150,000,000 taking the order backlog to 529,000,000. So on the next slides, I’ll go through go into more detail on these key financials. As I just mentioned, order intake total 150,000,000 including favorable currency effects of 22,000,000 quarter on quarter and 23,000,000 year over year.

So when we adjust for the currency tailwind, the development is broadly flat quarter over quarter and year over year. Over 60 of this quarter’s order intake came from existing customers and over 50% came from Europe. We ended the quarter with a backlog of 529,000,000 up sequentially 3%. Although both orders and revenue remain lumpy due to the project based nature of our business, we view the overall market as having stabilized somewhat following the peak tariff related uncertainties we saw at the ’1 and the ’2. As I’ve mentioned, we delivered sequential revenue growth of 56% to a 134,000,000 in quarter two with this growth reflecting the unusually weak q one.

As you can see, growth came substantially in Europe mainly within the standard segment. So that’s an example of those pockets of resilience that Matt Matt referenced earlier. In this quarter, we shipped another order store as a service deal and we’re very happy to see customers and projects that we would otherwise would not be able to access finding this offer interesting. This contract is not reflected in our revenue figures for the quarter neither are the q ones from q one. Revenues will start to be recognized when these sites go live and will continue over the length of the contracts with the potentials will increase as customers increase the size of their installations.

Okay. Let’s move on to margins. With the significant enhancements we’ve introduced at both the software and robot level, the b one solution is no longer an optimal solution for customers. Therefore, in q two, we decided to phase out the b one business line. This led to an 8 and a half million write down of inventory in the quarter and as I mentioned excluding the write down, gross margin was 75 percent which reflects our strong operational discipline.

Further down the P and L, adjusted EBITDA came in at 48%. This shows that the actions we’ve taken to restructure the business have started to have an impact in the second half of this quarter And these will generate annualized cost savings of approximately 10,000,000 whilst we continue to invest in long term growth. If I now move on to cash flow net debt, I would note that 40,000,000 of EBITDA on the slide and our final settlement payment leads to closing cash at the June of 300,000,000 or net debt of 150,000,000. Furthermore, I’m pleased to report today that we’ve secured a fully underwritten 500,000,000 five year bank facilities. So with that, I’ll now pass back to Heeva who’s gonna open up for the q and a.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Paul. Mats, do you wanna join me? So I’ll welcome the questions from the from the team’s audience first. And the first one with the who’s raised his hand is is Luke. So Luke, if you could please go ahead and unmute yourself.

Luke, can you hear us? Seems like we might have some technical issues. Bear with us. Luke, can you please try to unmute yourself again? While we are dealing with some tech me?

Oh. I can hear you now, Eric. Can you hear us?

Peter, Analyst: I can. May I go ahead with my questions, please?

Silva Flocher, Investor Relations Officer, Autostor: Please do, Eric. Please. And I can put them one by one, a couple of order intake and some of them.

Eric, Analyst: If you strip out the FX impact on

Silva Flocher, Investor Relations Officer, Autostor: you.

Eric, Analyst: I was also wondering, are there kind of one, two or three big orders that really helped the order intake in the quarter? How should we kind of think about that?

Mats Blanwyckse, CEO, Autostor: You’re right. As we were kind of reporting first quarter, we were at the peak of market uncertainty. And that’s also what we were hearing from customers that they were trying to maneuver in an uncertain world. But look, as the quarter progressed, we did identify these pockets of opportunities that I’m very glad to see we were able to go out and utilize. So I’m very happy to see that our performance in last quarter is producing the results that we report here today.

And personally, I’ve also spent that quarter traveling around speaking to customers across all regions, across a wide variety of end markets and what has met me is, yes, a set of customers that is trying to maneuver in an uncertain world, but that’s also a set of customers that has very high conviction in their investment plans around automation because the challenges that they’re faced with and those challenges that we solve with automation is as prevalent as ever.

Paul Harrison, CFO, Autostor: I think if I can add Eric to your point about other is it characterized by large deals in the quarter? Actually one of those pockets of resilience was Europe and our particular strength in Europe still lies in the standard segment actually. So if anything, it’s the volume of smaller deals in Europe that has really driven that performance.

Eric, Analyst: That’s great color. Thanks. And would you say that’s more company specific in terms of kind of your resilience, your end customer base, you being closer to the customers? Or are you seeing kind of a general bit maybe of a step down from the very peak of uncertainty that we saw in Q1, early Q2 kind of as a general note? Like how much is market?

How much is company specific?

Mats Blanwyckse, CEO, Autostor: Look, I think it’s a combination. What we have seen is that the markets have stabilized somewhat from that peak level of uncertainty. But of course, as we talked about these pockets that we’ve been able to utilize, we are selling a lot to our existing customers and our installed base and customer base is the strongest in this market. And we are selling a lot in Europe, which is that stronghold that we’ve built. So I think in reality, it’s a combination.

Eric, Analyst: That’s very clear. Thanks. A follow-up kind of on orders and also on revenue. If you look at kind of last quarter order book to this quarter revenue, the conversion took a big step up from Q1, but it’s still below historical levels. Could you help us understand kind of how that’s driven by as a service, how it’s postponements, longer projects time maybe for high throughput?

And also how we should think about that order book to revenue conversion and how that should evolve in the second half of this year?

Mats Blanwyckse, CEO, Autostor: Maybe I’ll start and you can add, Paul. But look, as we’ve talked about since the Capital Markets Day, we’ve had a big focus on getting even closer to the deals, even closer to those customers, setting up a good deal room and being very, very focused on driving conversion. And we’ve seen that create some results also as it comes to backlog conversion trends, right. So I think we’re seeing some positivity there. But then of course we have the order store as a service, etcetera.

Paul Harrison, CFO, Autostor: Yeah, and on that Eric, know, we’ve now got the quarter one quarter two about 34,000,000 of revenue that is, if you like, gone into backlog as a result of order store as a service. And these deals you know, are typically ranging from sort of three to eight years. So you are right, they will they will sit and be relatively slowly released literally on a monthly basis into backlog. So so that is another another effect, but the fundamental point is the one Matt Matt makes there.

Eric, Analyst: That’s very clear. Thanks. And since you mentioned it, just a final one for me. Of the 34 in in q one and q two for us as service, has has any of this been recognized in q two already or is that something for for q three and beyond?

Paul Harrison, CFO, Autostor: Indeed it is for Q3 and beyond. So we start to recognize revenues under those deals when the installation goes live and they have not gone live as of Q2, so no revenue in Q2 for order stores or service, and that will start in in subsequent quarters.

Eric, Analyst: Perfect. Thank you. I’ll jump back in line.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Eric. Shall we try Luke again? Can you please unmute yourself?

Luke, Analyst: Yep. Morning, everyone. Hopefully, this works. Can you hear me?

Silva Flocher, Investor Relations Officer, Autostor: Yes.

Luke, Analyst: Hopefully, you can hear me.

Paul Harrison, CFO, Autostor: Yes.

Peter, Analyst: I’m

Luke, Analyst: My question was yeah, was was so sorry. Yeah. I’m I missed I missed the last question, but, I’m not repeating, in changing my device. But but we what we saw in q two was, obviously, a rebound in Europe, but but North America and and Asia Pacific still very weak. I’m just trying to understand what the trajectory for those two segments looks like into q three and when we can start to see a more of a cyclical recovery there.

And then the the second question, just you you called out the auto store as a service, which is clearly having some traction, but mainly centered on the 3PL base. And I think on your customer slide, you pointed that was about 14% of group revenue. So I’m just trying to understand here what the overall customer target target market is just to to get a flavor of where that that long term mix could be. And then just the final question would just be on the kind of the big beautiful bill in The US on the r and d expense side. Is there any impact for you at all as a result of that?

Thank you very much.

Mats Blanwyckse, CEO, Autostor: North America, do you Yes. So on North American APAC to start there, what we’ve seen in North America, which is one of the markets where we see the highest potential going forward, we haven’t seen that materialize into revenue yet. But if I look at order intake and other leading metrics, we’re seeing good developments in North America, particularly then after there’s been more clarity on the tariff side. So going forward, we’re seeing improvements in those leading indicators. APAC has been kind of roughly flattish for a while and we are focusing our resources in those key markets where we see that there is opportunity.

But again, going forward, we see North America being a large growth opportunity and then Europe continues to be very, very strong.

Paul Harrison, CFO, Autostor: Order source service, your observation is a good one. 14% of our revenue has been in the 3PL space and certainly that model is resonating in terms of conversation in the 3PL space given their particular business model. We don’t think it’s necessarily confined to that space but certainly we we think over time it will be of particular interest there. As to the R and D aspects of The US led administration, I think it’s really too early to to point to an impact at that at this stage, Luke.

Luke, Analyst: Understood. And just to be clear, you’re saying that in q three, it sounds like the revenue trajectory so far hasn’t substantially recovered in North America to q two. That that’s the right way to read your comments.

Mats Blanwyckse, CEO, Autostor: I think for Q3, it’s still too early to be specific on revenues. But what we can say is that in Q2, we saw that order intake and other leading indicators tracked positively for North America.

Luke, Analyst: Thank you very much.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Luke. Moving on, Tobre, please go ahead and unmute yourself.

Mats Blanwyckse, CEO, Autostor0: My question. I hope you can hear me all right. Just one question on the AutoStore as a service here. So on the CHF 6,900,000.0 that you’ve booked, two questions on this. Is this now in absolute terms more than what it would have been if you sold it over your normal approach of selling solutions?

Or does this basically, the question, does this include over these recurring revenues an overall sum of all revenues over the lifespan of the contract that is just larger than your usual sales? And could you give us a bit more detail of which time horizon should we expect? Will it start in like two or three quarters? And then is this expected to run over seven, eight years? Just more details here.

Thank you.

Paul Harrison, CFO, Autostor: Yeah, let me try, Mats Meiwalad. So look, one thing to step back and talk about the first half orders to store as a service deals. The economics for us are quite attractive. We’re seeing those deals move into the black in sort of early to the mid stage of the contract term versus the equivalent CapEx sale of those same solutions. You know, it’s early days, but but the economics, as I say, have been strong for for that reason and of course that ignores the potential for customers to increase the size of their installation and or extend over time.

I think your point is well made, you know, we shipped the solution under these deals. Therefore, as you can imagine, a customer is looking at sort of two to three quarters before they go live. They wouldn’t naturally want it any any to receive the product any earlier than that.

Mats Blanwyckse, CEO, Autostor: And then to the last part of your questions, the numbers of the SEK7 million represents the revenues that is to be booked over that contract period, and that contract period is ranging from everything from three to eight years.

Mats Blanwyckse, CEO, Autostor0: Okay. Just to clarify, when you speak about your thinking into the black numbers towards the middle of the overall contract span, Should we understand this in the way of the profitability level is basically the breakeven? Or should we understand this that the total revenue number that you would have received is already reached basically halfway through?

Paul Harrison, CFO, Autostor: Yes. It’s a revenue. It’s a revenue observation.

Mats Blanwyckse, CEO, Autostor0: Okay, so basically with this auto service you’re doubling your revenues over the contract span?

Mats Blanwyckse, CEO, Autostor: So the point is, compared to the profitability that we would normally make in an upfront sale was that was what the comment was linked to.

Mats Blanwyckse, CEO, Autostor0: Okay. Understood. Thank you. Thank

Silva Flocher, Investor Relations Officer, Autostor: you, Tore. Tim, you’re next. If you could please go ahead and unmute yourself.

Mats Blanwyckse, CEO, Autostor1: Hi. Can you hear me?

Silva Flocher, Investor Relations Officer, Autostor: We can.

Mats Blanwyckse, CEO, Autostor1: Alright. Great. Thanks for taking my questions. So I have three questions. So the first question is a bit more follow-up on your North America market.

So as you just mentioned, there’s some positive indicator in this order intake or the other indicators. So can you please also give us a little bit sense about what was the mix of North America in your order intake in the second quarter, and what’s the growth that you are mentioning? And what would be the end markets that you see to be having a good indication or momentum in the North America market? That would be the first question.

Mats Blanwyckse, CEO, Autostor: Yes. So what we’re seeing is on a relative basis also growth and then hence also taking a larger share of the total order intake versus what it’s been in the past. If I look at this from an end market perspective, I think there’s two things to note. One is that some of those traditional more or less cyclical segments such as industrials, healthcare, etcetera, continues to be strong also in that market. But on top of that, we’re also seeing some positive trends within the broader retail markets including e commerce.

So as I look at kind of the customer opportunity in North America, we’re having good conversations across all those segments.

Mats Blanwyckse, CEO, Autostor1: Okay. Thank you. And the second question is about the the order intake again. So the the FX impact in the second quarter is around 22,000,000. That talk about roughly 16% year on year positive impact on the order intake.

If you look at the the US dollar depreciation, I think this is the main part of the FX impact. Right? And the depreciation of the US dollar was roughly 10% on a year on year basis, and it’s mainly for our Europe business. So which is around 70% of the total business. Right?

And so it seems like the FX impact is a bit bigger than what we think from the US dollar depreciations. So what would be the missing parts that I I may have, you know, in terms of my calculation?

Paul Harrison, CFO, Autostor: It is primarily u US dollar the the weaker US dollar base and obviously the functional currencies in which we we invoice. I I think I’d have to take offline that sort of reconciliation of your your numbers to ours. But, you know, we we we’ve tried to be very, you know, open about the favorable impact of of currency on order intake. That’s that’s our point.

Mats Blanwyckse, CEO, Autostor1: Yeah. No worries. Thank you very much. And my last question will be on the transformation projects that you have been taking. Any more activities that you foresee, you know, going forward?

And for example, would there be any other product lines that you think probably that’s no longer to be optimal for your customers and there may be another inventory provisions going forward that you can foresee?

Paul Harrison, CFO, Autostor: No. So we have we have no other plans for either for the reorganization or the discontinuation of product lines. There’s particular significance to the B1 end of life and that is a consequence of quite considerable improvements we’ve made recently in both our robot performance and software development but there are no other plans for reorganization or restructuring at this time.

Mats Blanwyckse, CEO, Autostor1: Thank you,

Silva Flocher, Investor Relations Officer, Autostor: Tim. Moving on to Hakon. If you could please go ahead and unmute yourself.

Mats Blanwyckse, CEO, Autostor2: Hi. Thank you for taking my question. Hakon here from Kepler Cheuvreux. I’m just quick about the quick question about the services service again because in q one, it was 27,000,000 and compared to 6.9 this quarter. And I just can wonder, could you elaborate on what drove the new the difference between these numbers, and and and how should we think about the more normalized run rate for that store as a service system going forward?

Paul Harrison, CFO, Autostor: Yeah. Thanks for your question, Orkhan. Look look, I’ll start there. This, as you know, is is a relatively, new offering, to our customers, and I don’t think for some time we can expect a linearity if you like to progression. What is particularly, encouraging actually about the order stores as service as the conversations it opens up with customers and some of them may start with a particular interest in order stores as a service but actually with fuller consideration actually revert back to the traditional sort of CapEx model.

So it’s opening up a broader dialogue with customers leading to to benefit for both models. But I think, you know, it is early days. It’s a relatively small number of deals and we’re some way away for any sort of linear progression or industrialization, if you like, of this of this solution.

Mats Blanwyckse, CEO, Autostor2: Okay. Thank you so much.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Hakon. Martin, you’re next. If you could please go ahead and unmute yourself. Thank you.

Mats Blanwyckse, CEO, Autostor3: Yeah. Good morning. Thank you. It’s Martin from Citi. The first question I had was just on the mix of, products.

And, obviously, you got a rebound in the gross margin excluding the, the inventory on the on the BlackLine. Have you started selling or recognizing revenue on Carousel and some of the other new products? And and if not, when those start getting recognized in revenue, should we expect a bit of mix effect to gross margin?

Mats Blanwyckse, CEO, Autostor: Yeah. So, look, it’s it’s still relatively early days if you think about those products that we’ve launched over the last twelve months. But I am very happy to say that across all of those products, we have made sales and we’re seeing a good proportion of that being in also in pitch stages and late stage opportunities. As you think about the profitability, those products that we’ve released are typically part of the overall system. So from a profitability mix, you should expect similar as we have in our current numbers, But very happy to see that traction that we have across those products that we’ve released given that they’re effectively improving the overall solution that we can offer to our customer.

Paul Harrison, CFO, Autostor: And the only add to that would be obviously with the growing installed base, we’ve got the software part of our business that grows in terms of its resonance in the mix and that is obviously a very highly favorable gross margin.

Mats Blanwyckse, CEO, Autostor3: Yes. No. That that makes sense. And and just continuing on the gross margin, mean, obviously, in terms of pricing, is is it right to think that any pricing that you’ve had to put through so far for tariffs or or other effects are now fully effective, or is is there still a bit of a lag effect in terms of when when pricing might come through in the second half?

Paul Harrison, CFO, Autostor: We we’ve really thus far seen, very little limited impact, of tariffs. Keep in mind as well, Martin that it’s actually you know our partners that are the importers and who principally therefore will bear that tariff cost but but there’s a slightly sort of calmer sort of attitude we’re seeing at the moment on tariffs and that perhaps comes as a result of some of these deals that have been secured e. G. With the EU. So we’re not at least thus far seeing an impact on gross margin of tariffs.

Mats Blanwyckse, CEO, Autostor3: Great. Thank you very much.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Martin. Christian, you’re next. If you could go ahead and unmute yourself. Thank you.

Mats Blanwyckse, CEO, Autostor4: Hi. Can you hear me?

Silva Flocher, Investor Relations Officer, Autostor: Yes, we can.

Mats Blanwyckse, CEO, Autostor4: Okay. Good. Thanks. Christian from from Arctic Air. So two two questions from from me, that’s okay.

So the first one, some of your listed competitors have reported quite strong figures into Q1 and Q2 and showing an improvement in order intake from last year. And if we strip out the currency effect you had, you had some slowdown yourself and your competitors have also been quite constructive on the market outlook for 2025. So just wondering if you could help us understand this sort of inconsistency versus your competitors this year, while in previous years you more like outperformed them? Thank you.

Mats Blanwyckse, CEO, Autostor: Yes. Good question. So look, if you look at some of the related markets to where we operate, we are seeing some pockets of good performance. However, if you strip that down to the market that we operate in, we actually see ourselves gaining share in what has been and it continues to be a quite challenging market. But if you take a broader view on kind of warehouses e commerce in general, we were seeing good traction on the parcel side of the world, Some of the non discretionary spend is driving some performance within the pallet market.

We’re seeing that some of those smaller ticket items where operators can slightly improve some of their existing warehouses, have seen some good performance, etcetera. But if you drill that down into our market, we’re performing well relative to the market overall.

Mats Blanwyckse, CEO, Autostor4: Okay, good. Makes sense. And just final follow-up here on how to start as a service. I know you answered a couple of questions already, but given that you don’t provide any KPIs on this still and it was quite a significantly lower share in the second quarter, should we understand this as you don’t expect any significant uptick in Q3 or in the short term going forward and that the Q1 share was sort of a one off in terms of the large share it was?

Mats Blanwyckse, CEO, Autostor: Look, as Paul said, it is still early days. We’re seeing it come up in more and more conversations. But because it is early days, you should expect some lumpiness in terms of how it actually comes out on a quarter over quarter basis. So it has a focus within our organization because it’s a good solution that we can offer to our customers and customers are asking for it. It’s healthy for the profile of our business, so we will continue to have a focus on it.

But let’s give it some time and see how it actually materialize on a quarter by quarter basis before we fully conclude on which KPIs to report and can be more specific in terms of what to expect.

Paul Harrison, CFO, Autostor: Can I just add a comment back to Tim’s earlier question? I think Tim, we will come back to you on that FX rate point, but I think the possible explanation lies in our use of average rates when we compare period on period versus closing rates, which I think you were quoting there, but we will come back to you.

Mats Blanwyckse, CEO, Autostor5: Thank

Silva Flocher, Investor Relations Officer, Autostor: you.

Mats Blanwyckse, CEO, Autostor4: Okay. Thanks.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Christian. Tintin, you’re next up. Please go ahead and unmute yourself.

Mats Blanwyckse, CEO, Autostor5: Great. Can you hear me?

Silva Flocher, Investor Relations Officer, Autostor: We can. Good morning.

Mats Blanwyckse, CEO, Autostor5: Okay. Great. Morning. Sort of three things for me. Again, Altostore as a service, very popular topic.

More of a philosophical question, really. Is it quite a passive sales approach? How much are you pushing it versus how much is pull in terms of the deals that are happening? And if you look at your partners and the salespeople that are involved in the sale of that versus, say, your traditional CapEx model, what is the difference in sort of in the commission structure and how they’re incentivized? So that’s one.

Can I just dump it all in one go? Gross margin without after without the exceptional is kinda at that 75% level. Paul, are you happy for us to kinda run the models at that level now? And if so, plus minus sort of give us the reasons. And then thirdly, terms of q in terms of quarterly seasonality in the business, q one, q three typically lower, q two, q four typically stronger.

Obviously, we’ve had so much impact on kind of tariffs, relative confidence. In terms of the next quarter’s seasonality Q3, should we kind of expect that even though, okay, a bit of stability and recovering, we should expect the normal seasonality we would see in Q3?

Mats Blanwyckse, CEO, Autostor: Why don’t I start maybe on one and three. So on number one, our focus isn’t necessarily on exactly what solution we try to push, but our focus is to get close to those important customers that we have and that we’re trying to get, understanding the needs that they have and translating that back to our offerings and saying here is how we can help you solve those needs. And in some pockets of the market, for instance, the 3PL market, we see that this model resonates very, very well because it matches the contract structures of those businesses. And hence, yes, we often lead the conversation with such a model because we know it resonates very, very well. But at the end of the day, it’s the suite of offerings that we have that we’re matching against the needs that our customer has.

And if you look at how we incentivize our salespeople, we focus on value creation for the business. So yes, they will be incentivized to also push and sell the AutoSurf as a Service offering when that is something that we see can help drive conversion with the customer, help that customer create even more value within their own business model. And then on the third one, I think taking a step back here, with our business model and with our operations, there will be lumpiness. We’ve said this since the start, right, Because we’re exposed to a project based nature, because this is at the end of the day investments for our customers and now in addition to the asset service model, there is a natural lumpiness within our business model.

Paul Harrison, CFO, Autostor: Tintin, thank you for your question on gross margins. You are right. 75%, I think in certainly the quarters I’ve certainly reported is the highest underlying gross margin. But actually, what I would say stepping back is now for a number of successive quarters, our gross margin has been sort of in the early to mid seventies. I will always have an eye on the, LME market, the commodities, the underlying commodities that go into the production of robots, which we don’t fully control as we saw at the, you know, with, for example, the Ukraine, situation.

So I would encourage you to think about it as sort of early to mid seventies and not necessarily modeling forward as high as ’75.

Mats Blanwyckse, CEO, Autostor5: Great. Thanks, guys.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Tintin. Peter, you’re next.

Peter, Analyst: Thanks. Actually, gross margin question was just answered so that I can skip that one. Then I have one more question. Is it possible to share some insight on how activity level has developed during the quarter? I think you must mention that the peak of market uncertainty was around the start of Q2.

Thank you.

Mats Blanwyckse, CEO, Autostor: Yes, you’re right. We reported Q1, we talked about how that level of uncertainty was very, very high. But I think what we’ve seen over time is those markets stabling somewhat, is our customers kind of getting more certainty, figuring out how to maneuver that world and can then focus on improving the business, which is what we help them do. And as I said, ahead of summer, during summer, I’ve kind of traveled around, spent a lot of time with both existing customers and prospective customers and that’s also what I’m sensing is that there is a continued strong conviction on their automation roadmaps, what they’re trying to solve for within their business and we’re getting headroom to actually think about that as well.

Peter, Analyst: Thank you.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Petter. Tintin, you have your hand up. Did you have a follow-up question?

Mats Blanwyckse, CEO, Autostor5: No. I don’t.

Silva Flocher, Investor Relations Officer, Autostor: Okay. Maybe, Simsin.

Mats Blanwyckse, CEO, Autostor5: Forgot the hand.

Silva Flocher, Investor Relations Officer, Autostor: Thank you. Just just checking. If not, then, Lasse, you’re next. Please go ahead and unmute yourself.

Mats Blanwyckse, CEO, Autostor6: Hi. Good morning. Just one follow-up just on, again, AutoStore as a service. Again, more of a conceptual question, but can you disclose how many of the partners that you have are now offering as a service? Or if not, just generally, I mean, what is the feedback you’re getting from the partners?

Because I guess for a few of them, it probably adds maybe some unwanted complexity to their own business model, or maybe you could explain the mechanics of, you know, when you’re onboarding a partner as a as a service partner as well, how that also then looks from from their kind of economics and revenue generation perspective. So if you could just help guide us a little bit there on on what the feedback is and how that looks amongst the 21 partners or is it 22 now that you have? Thank you.

Mats Blanwyckse, CEO, Autostor: So look, we’re we have designed an additional offering that our partners can decide to use to create for success in their business. We’ve had those conversations and onboarded those kind of large partners that make up a big share of our overall business. And we’re collectively with and through those partners going to market with this offering. So, overall, I feel like we’re in a very good place with the partners to actually drive adoption in those relevant end markets and segments with this as a service model. And of course, just again, fundamentally taking that step back, we have designed it in a way so that this is also good business for our partners because if you think back, we have this important win win win strategy where we need to be in a good place, our partners needs to be in a good place and our customers need to win.

And as long as we can have that model, we have learned that we get focus and focus creates results.

Mats Blanwyckse, CEO, Autostor6: Okay. Maybe just a follow-up. In terms of because with the as a service, I guess you are taking credit risk on the customer to some extent. How has that changed the approach with dealing with different customers? Because I guess, you know, you don’t wanna be looking at customers defaulting on on payments a few years down the road.

So how has that changed the approach?

Paul Harrison, CFO, Autostor: Yeah. It’s it’s it’s a good question, Lasse. I mean, we we do take that credit risk ultimately through our partners but keep in mind one important thing, we continue to own the asset and our products are highly standardized. So in the event of a credit failure, we do have the ability to recover the assets and redeploy them elsewhere. It’s an important point to bear in mind this highly standardized nature of our product.

But obviously we undertake all the appropriate diligence when it comes to credit assessments.

Mats Blanwyckse, CEO, Autostor6: Okay. Thank you.

Silva Flocher, Investor Relations Officer, Autostor: Thank you, Lase. I don’t see any more hands being raised. I’m just going to check the web player as well. And I think we’ve asked or answered the questions here. I guess one question that we haven’t answered, Paul, is for you and and that’s how if we can please, confirm the use of proceeds, from the new, bank facility.

Paul Harrison, CFO, Autostor: Sure. Sure. So as I mentioned, I’m I’m pleased with the structuring of our new facility, $350,000,000 revolving credit facility, a 150,000,000 term loan A gives us a lot more flexibility when it comes to applying the cash we generate to the core debt that we have. Specifically in terms of source and use of the funds, we will use the new facilities to repay the term loan B, we will cancel the existing revolving credit facility which we have actually never used and therefore you see a shift of debt initially to the revolving credit facility but as I say, think about the, greater potential to optimize treasuries as we generate cash and use that cash to offset the debt in an RCF without actually losing the headroom in so doing.

Silva Flocher, Investor Relations Officer, Autostor: Thank you. I I believe this concludes the q and a session for today. And with that, I’ll hand over the word to Mats for his final remarks.

Mats Blanwyckse, CEO, Autostor: Thanks, Eva. So let me summarize what we’ve presented to you today and also remind you of some key points. So first, we operate in a large underpenetrated market fueled by long term megatrends and that growth opportunity is intact and we have a winning proven solution. As we’ve already discussed, we’re responding to the current market conditions by taking decisive actions aimed at maintaining high profitability, strengthening our competitive position and supporting long term growth and resilience. And we’re not standing still.

Innovation is embedded in our DNA and we continue to push the boundaries of what’s possible. At our last update, you heard us talk about the latest innovations and product launches and the next one is in October this year, so stay tuned. Look, we have several ways to win and a scalable solution that works across industries, system types and geographies, all delivered through an efficient partner enabled model. And taken together, these elements gives us the confidence in our direction and our ability to create long term value. So, I’d like to thank you for dialing in today and look forward to speaking to you again soon.

Thanks.

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