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Elliptic Labs reported its Q1 2025 earnings, revealing a 20% year-over-year revenue increase to NOK 26.6 million. Despite this growth, the company’s stock price fell by 7.75% in pre-market trading, reflecting investor concerns. The company showed operational improvements, with EBITDA improving to -NOK 1.6 million from -NOK 3.3 million in the previous year. Operating cash flow was positive at NOK 12.1 million, and the equity ratio remained strong at 90%. According to InvestingPro data, the company maintains a strong financial health score of 2.73 (GOOD), with a remarkable current ratio of 7.83, indicating robust liquidity management.
Key Takeaways
- Revenue increased by 20% year-over-year to NOK 26.6 million.
- EBITDA improved significantly, reducing losses.
- Stock price dropped by 7.75% in pre-market trading.
- Positive operating cash flow of NOK 12.1 million.
- Continued product innovation and strong OEM partnerships.
Company Performance
Elliptic Labs demonstrated solid performance in Q1 2025, with a 20% increase in revenue compared to the same quarter last year. The company managed to improve its EBITDA, showcasing effective cost management despite a 6.1% rise in operating expenses. This indicates a strategic focus on scaling operations while maintaining financial discipline. InvestingPro analysis reveals the company’s impressive 93.08% revenue growth over the last twelve months, though it currently trades at a high P/E ratio of 133.5. Subscribers can access 16 additional ProTips and comprehensive valuation metrics through the Pro Research Report.
Financial Highlights
- Revenue: NOK 26.6 million, up 20% year-over-year.
- EBITDA: Improved to -NOK 1.6 million from -NOK 3.3 million in Q1 2024.
- Operating cash flow: Positive at NOK 12.1 million.
- Equity ratio: Stable at 90%.
Outlook & Guidance
Elliptic Labs is targeting a NOK 500 million revenue milestone, with plans to expand product launches and increase deployments per device. The company is focused on developing contextual AI capabilities and exploring potential IP licensing opportunities, which could drive future growth. InvestingPro analysts have set price targets ranging from $1.77 to $1.87, with a consensus recommendation of 1.5, suggesting strong growth potential. The company’s revenue is forecast to grow by 64% in FY2025, supporting its ambitious targets.
Executive Commentary
CEO Lila Danielson stated, "We are building the future of AI sensing, making devices smarter, seamlessly connected, and intuitive." CFO Lars Holme emphasized the company’s financial strategy, saying, "Our goal is to ensure sustainable profitability by combining growth in top-line revenue with disciplined cost control."
Risks and Challenges
- Market volatility affecting stock performance.
- Potential supply chain disruptions impacting product launches.
- Competition from other AI and sensor technology companies.
- Economic pressures that could affect consumer spending.
- Dependence on key OEM partnerships for growth.
Q&A
During the earnings call, analysts inquired about the company’s strategy for expanding its smartphone and accessory market presence. Executives confirmed the flexibility of their sensors across devices and emphasized the need for more model launches to meet revenue targets. The company’s patent strategy and competitive positioning were also discussed, highlighting its robust intellectual property portfolio.
Full transcript - Elliptic Laboratories AS (ELABS) Q1 2025:
Lila Danielson, CEO, Elliptic Labs: Good morning and thank you for joining us today. I am Lila Danielson, the CEO of Elliptic Labs. Joining me today is our CFO Lars Holme. We’re excited to share with you Elliptic’s Lab results for the first quarter of twenty twenty five. Let’s start off with the highlights for the quarter.
Starting off with the key financials, Elliptic Labs delivered revenues from customers of million in Q1, up 20% compared to the first quarter of twenty four. As a side note, the first quarter has historically been weaker than remaining quarters due to market timing. EBITDA ended at minus 1.6, an improvement from minus 3,300,000 in Q1 twenty twenty four. A quarter where operating costs were offset by 2,000,000 in repayments. Adjusted for this, we maintained a flat operating cost structure year over year.
Our operating cash flow were positive 12,100,000 in the quarter and the resulting cash position was slightly up to around 77,000,000 at the end of Q1. Next, moving on to our commercial programs. We have demonstrated a rapid launch pace going into 2025 with 23 laptop models launched year to date, seven of which were dual sensor configuration, meaning two sensor per model. Note that we only had permission to officially announce two of these models in press releases. This means that by May, we have already almost doubled the number of AR virtual smart sensors deployed in laptops for the full year in 2024.
And we continue working hard to maintain our growth trajectory. We have also launched 23 smartphone models to date and have already secured firm commitments for at least an additional 45 models. That is expected to launch over the next twelve months and we continue to expand in the smartphone market of course. Okay. So our vision is to build and our vision has not changed, the leading AI software platform for all user experience making every device smarter, interoperable, more human and environmentally friendly.
We are building the future of AI sensing, making devices smarter, seamlessly connected and intuitive with advanced AI, sensor fusion and as we’re moving up the software stack, we’re not just improving technology, we are redefining how it interacts with the world. Today, over half a billion devices are using our AI platform to make them greener, smarter and more user friendly. Okay. Zooming in to the smartphone vertical, we have seen significant progress so far this year and as can been seen from the chart, our launch trajectory is steep. We have launched 185 smartphone models to date with 23 launches in 2025, ’11 launches in the first quarter and another 12 so far in the second quarter.
And as many of you know, our journey started by building a solid platform in the smartphone segment, where we since our inception in 2016 have built an impressive portfolio with some of the largest OEMs across the world based on our leading market and ecosystem position. And to the right of the screen, you can see some examples of the innovative launches made in 2025. We continue to work with innovation, further cementing our position as the market leader in AI virtual smart sensors. Our technology and platform has become a pillar within device interoperability. And at Mobile World Congress in Barcelona this year, we launched yet another innovation, the AI virtual tap to share sensor.
With tap to share, you can easily share photos, contact information and much more between different operating system. Both iOS or Apple iOS and Android through a simple tap. Importantly, this works without preexisting connection between devices and is fully automated providing a smooth and intuitive user experience. Let’s take a look at how this works. So here you can see an easily tap and the information is being shared between those two devices.
As noted in the introduction, we are maintaining a rapid launch phase, the foundation for revenues going forward. So far in 2025, we have launched on 23 laptop models and 23 smartphone models. Of the 23 laptop models, seven of which have deployed dual sensor configuration, meaning both the AI Virtual Human Presence sensor and the AI Virtual Seamless sensor. We were unfortunately only allowed to announce two of all of these launch models. As such, we have launched 30 virtual sensors year to date across 23 laptop models, which compares to 16 virtual sensor for the full year 2024 and we’re still not even halfway through the year.
This demonstrates the increasing demand for our cutting edge AI driven solution out in the market. The initial milestone revenue from the laptops launched in Q1 twenty five, meaning revenue for the minimum commitment volumes were recognized at contract signing in ’24. And we expect more revenue from these laptops as they scale in a market. Our model is highly scalable. We charge a license fee per device we ship to the end customer.
And this is also charged per product. So per virtual smart sensor, that means that we if we have two products on one device, we charge one fee per product on that device. As we deliver more products to a wider range of devices and onboard new OEMs, we are strongly positioned to deliver significant growth in time to come. We also maintain a very strong launch pace for smartphones and have already secured additional or actually a minimum of additional 45 smartphone models so far this year. With 23 launches and 45 commitments, we’ve already secured more models than were launched in 2024 and we see a big upside for the remainder of the year.
Elliptical Amps has also streamlined the purchasing process for smartphones, where we now only need a simple written notice to expand contracts, removing the need for repeated purchasing improvements and reducing the threshold for expansion. We are excited about our commercial progress and the position we have built for growth going forward. For those who have been following us for a while, you know that our collaboration with Intel began with architect validation a few years ago, ensuring our technology work on their chipset driven by OEM customer demand. Over time, we have been aligning our roadmaps and working closely together with Intel to successfully deliver our products. Today, that collaboration has significantly deepened.
We are now co engineering innovation with Intel and leading OEMs, embedding contextual intelligence in real world use cases directly into Intel’s AIPC roadmap. SmartShare is an example that we jointly delivered with Intel for Lenovo last year. We are now expanding this co engineering partnership to be launched on more future projects. In practice, this makes it easier for our OEMs to implement our technology on the laptops. Further, it marks a meaningful evolution where we are now collaborating more closely than ever with key ecosystem players to jointly develop future ready innovation.
And next our CFO will present our financial. Thank you.
Lars Holme, CFO, Elliptic Labs: Thank you, Laira. Now let’s move into the financial review for q one twenty five. We are focused on building a solid foundation for durable, profitable growth. Our goal is to ensure sustainable profitability by combining growth in top line revenue with disciplined cost control. I will walk you through the numbers and trends shaping our financial performance this quarter and the broader trajectory for Elliptic Labs.
In Q1 twenty five, revenue from customer was NOK26.6 million, representing a 20% increase compared to NOK22.2 million in Q1 twenty four. It is important to note that our revenue may fluctuate from quarter to quarter largely due to the timing of milestone revenues, new product launches and shipment schedules in the market. However, the underlying trend is clear: we continue to deliver solid growth as our customer contracts and deployments scale up. A key pillar of our financial strategy is to grow revenues while maintaining a stable cost base. On a running twelve month basis total revenues have increased by 56.2% year on year, operating expenses rose only 6.1% in the same period, highlighting strong cost discipline.
This dynamic has enabled us to achieve a positive EBITDA on the last twelve month basis, reflecting the scalability on our business model. We are set to continue this trajectory, driving revenue growth with minimal incremental cost, thereby enhancing profitability as we scale. Diving deeper into the P and L for Q1, revenue from contract with customers asset came in at 26,600,000.0, 20 percent from last year. Operating costs totaled 28,600,000.0 with employee benefits expenses at 22,000,000, reflecting additional FTEs is two additional FTEs, salary adjustments and the full year effect of hires made in 2024. Other operating expenses were NOK6.7 million, up from NOK4.3 million last year.
If you adjust for repayment recorded in Q1 twenty twenty four, expenses remained quite stable year over year. Importantly, EBITDA improved to minus 1,600,000.0 versus negative 300,000.0 last year, a strong signal of progress. We remain focused on balancing investment in growth with cost management. Turning into cash flow, we delivered a positive operating cash flow of NOK12.1 million compared to NOK13.6 million last quarter, meaning Q4 twenty twenty four. Key contributors included a NOK14.4 million loss before tax, but a NOK 18,500,000.0 net decrease in accounts receivables.
Investments are primarily in R and D, our AI virtual smart sensor platform. On the financing side, repayments included 1,900,000.0 for lease liabilities, 1,000,000 for short term debt and 500,000.0 in interest payments. It’s also important to know that our revenue is invoiced in USD, so exchange rate fluctuation can affect cash flow. Overall, our cash position is stable, allowing us to continue executing our growth strategy. Our balance sheet remains robust, with cash and cash equivalents at NOK76.8 million, up from NOK76.4 million at the end of Q4 twenty twenty four.
Current assets benefited from a NOK $118,500,000.0 decrease in trade receivables and a NOK 1,900,000.0 increase in other receivables. We continue to work with our customers to better our payment cycles related to milestone revenues. Liabilities have stayed flat and our equity ratio is stable at 90%. We are well funded to execute on our growth plans with the financial flexibility required to invest in innovation and new customer deployments. This strong financial position underpins our confidence in continuing to scale and innovate the quarters ahead.
And next, I will hand it back to our CEO, Leila, to finish up the presentation. Thank you.
Lila Danielson, CEO, Elliptic Labs: Thank you, Lars. We have spent the past decade building a solid platform based on our new own neural networks. We developed a deep expertise in AI, software operating system, sensor, processing platform, applications, large language models, small sensing models, they had the full stack. Our experience ranges from the operating system to application and embedded software integrated into complex environments. As we said earlier, we have separated our journey into three key phases, each building on the top of the previous phase.
We started out our journey in phase one, replacing hardware sensor with AI virtual smart sensors and building a foundation with our customers. We continue to do so and expand our position with our customers. We’re currently in the second phase, focusing on device interoperability, where we’re moving further up in the software stack and deliver through device device interoperability. This is unprecedented in the market. Going forward, we are working our way into the third phase together with partners and customers to deliver contextual intelligence.
We’ve been collaborating closely with the biggest players in the device ecosystem such as Intel and Qualcomm. And as I told you earlier today, we are now strengthening our partnership, particularly with Intel to bring new AI features to Intel’s next generation AI chips and laptops. By delivering contextual aware AI agents, we will unlock actionable insight and generate groundbreaking AI driven use cases in the time to come. And finally, let’s revisit our assumption to drive future success. We are focused on maximizing our contract base, strengthening customer relationship, expanding partnerships and increasing AI virtual smart sensor adoption.
Our AI virtual smart sensor technology is rapidly expanding across industry, improving device intelligence and user experience. We’re working closely with OEMs to integrate AI virtual smart sensor into more devices, including laptops and smartphones. Our focus is clear. Optimize contracts, increase adoption and scale product deployments per device. By driving continuous innovation, we enhance device capabilities and create more value for our customers.
With strong momentum and growing market presence, we are well positioned to drive future growth in AI powered capability. And thank you. And now we will take a quick break to review questions. Welcome back and also thank you to the investor that so nicely gathered many questions beforehand and submitted them. So let’s just jump into the question shall we?
Okay.
Lars Holme, CFO, Elliptic Labs: Okay. Can a new seamless sensor product for smartphone also be used with a laptop which is not born with these seamless sensors as long as the smartphone has the seamless sensor function?
Lila Danielson, CEO, Elliptic Labs: Yes. The seamless sensor is designed to be highly flexible. It does need to be this it does not need to be worn or meaning basically factory installed by the OEM to function. We can deliver experience via, you know, software whether through an app, web application or even a Windows update. So clearly this flexibility enables us to support a broader range of devices and partners while accelerated you know deployment and adoption without relying on you know being born or or relying on hardware integration cycles.
Lars Holme, CFO, Elliptic Labs: Yeah. We continue on the seamless sensor. Is the new seamless sensor for smartphone product made on request from a specific smartphone customer slash OEM?
Lila Danielson, CEO, Elliptic Labs: No. It’s more driven by the broad the broader market demand.
Lars Holme, CFO, Elliptic Labs: Then we continue. Have you experienced interest to sign new contract for smart from smartphone OEMs for the new seamless sensor product?
Lila Danielson, CEO, Elliptic Labs: So you know and normally we don’t comment specifically where we are in the sales process but of course we will announce when contracts are signed. Sure. Okay. So then we have another question here.
Lars Holme, CFO, Elliptic Labs: Mhmm.
Lila Danielson, CEO, Elliptic Labs: Okay. So this is a question for you. Alright. You are already achieving an impressive model and product launch. Thank you for that.
Now at two hundred and forty forty one models accumulated. However, run rate revenues are still a bit behind the NOK 500,000,000 revenue target. Can you maybe help us understand a bit better whether the ramp to NOK 500,000,000 is mostly related to volume ramp on existing models or do we also need further model wins?
Lars Holme, CFO, Elliptic Labs: Yeah. Okay. Thank you. Thank you, Christoph, for question. Sure.
So what we we usually answer to that question that we will need more models in the market, which we are already doing. We have surpassed last year’s models if you’re looking at the whole year for the PC. We’re now at 23. Last year was 15. So it’s coming quite fast, and there’s also dual sensor products in there as well.
And we that also improves our price painting in the market. So it’s but we need more products in the market. It’s not on existing launch models.
Lila Danielson, CEO, Elliptic Labs: Yeah. Yeah. So absolutely. And obviously, we are we are scaling. Yeah.
We see things are we see particular here in the laptop market, it’s water falling out. Yeah. And as you alluded to, over exceeding the full year of 2024
Lars Holme, CFO, Elliptic Labs: Yeah.
Lila Danielson, CEO, Elliptic Labs: In regards to launches.
Lars Holme, CFO, Elliptic Labs: And I’m just gonna keep you on that note for because a follow-up question here, so if you just go back there Okay. Which is a good question as well because we we we showcased the three pillars of our journey where we like replacing hardware sensors Mhmm. And then, of course, iterating on that. So how should we think about that and contributions into that?
Lila Danielson, CEO, Elliptic Labs: Yeah. I mean clearly that is a, you know, it’s of course strengthening at our position in the market for sure.
Lars Holme, CFO, Elliptic Labs: Yeah.
Lila Danielson, CEO, Elliptic Labs: And we had a very specific strategy that we were focusing on replacing hardware sensor with software to sort of get into the market and scaling and that was then of course moving up in a software stack delivering more visible product which has been beautiful.
Lars Holme, CFO, Elliptic Labs: And
Lila Danielson, CEO, Elliptic Labs: as I sort of presented also in the presentation and I’ve been rich at reiterating over time we have been working with AI and machine learning for a very long time. Yes. And so leveraging that internal expertise we see now with the explosion in AI that some of these new capability that is needed and we can deliver.
Lars Holme, CFO, Elliptic Labs: Yes.
Lila Danielson, CEO, Elliptic Labs: So the you know we it’s hard to say like is that it incremental to the the 500 NOK but it’s for sure certainly it would help to sort of fuel to get there. Yeah. And then of course we have life behind after 500,000,000 NOK but let’s
Lars Holme, CFO, Elliptic Labs: not jump into that yet. No. Okay. Thank you.
Lila Danielson, CEO, Elliptic Labs: Yeah. And then I have a bunch more questions here.
Lars Holme, CFO, Elliptic Labs: Yeah. Oh, we are back to the seamless sensor again. So what do you expect the price level to be for this new seamless for smartphone smartphone?
Lila Danielson, CEO, Elliptic Labs: Smart smartphone. Yeah. And then specifically compared to the proximity sensor. Yeah. You know, at this point, we don’t wanna talk specifically about pricing out in the market.
Lars Holme, CFO, Elliptic Labs: No. That’s I think that’s That’s fair. And then do you plan to make an accessories product for the smartphone vertical like for headphones, ear plugs, so forth? Yeah.
Lila Danielson, CEO, Elliptic Labs: Yeah. So as we have announced earlier, we have this already for the laptops Yes. Where we announced a POC for support of accessory for our seamless sensor.
Lars Holme, CFO, Elliptic Labs: And
Lila Danielson, CEO, Elliptic Labs: the fact is is that this underlying technology can be extended to the smartphone market vertical.
Lars Holme, CFO, Elliptic Labs: Yeah. And I think also just to reiterate our software So it’s the same underlying platform that we are utilizing across all of these platforms. These verticals. Yeah.
Verticals. Sorry. Sorry. And meaning also then it’s neutral depending on the processor from Intel, AMD, Qualcomm, Mediatek, so forth. So it’s working very well.
Lila Danielson, CEO, Elliptic Labs: Yeah. Well, more about the we have more
Lars Holme, CFO, Elliptic Labs: Yeah. We do.
Lila Danielson, CEO, Elliptic Labs: On the seamless.
Lars Holme, CFO, Elliptic Labs: Yeah. If a smartphone OEM implement the new seamless sensor product, do expect the rollout to be faster than the Novus rollout?
Lila Danielson, CEO, Elliptic Labs: The rollout timeline depends on each OEM’s integration plans and you know go to market strategy as we see here. So Yeah. We prefer not to speculate until deployment begins. No. So we have more more seamless questions.
Lars Holme, CFO, Elliptic Labs: Yeah. Do the smartphone seamless sensor product compete with the laptop seamless sensor product tap?
Lila Danielson, CEO, Elliptic Labs: From the sensor. So we see a slew of different application, maybe slightly different way of doing it and so forth.
Lars Holme, CFO, Elliptic Labs: Yeah. And a patent question. How strong do you consider LLat’s patents against the onslaught of AI operators looking to compete with the exact same utility and would you consider licensing patents?
Lila Danielson, CEO, Elliptic Labs: Okay. Yeah. So so obviously and the patent strategy we have you know taking a proactive approach to intellectual property. Obviously we have a large patent portfolio already and that’s you know it’s basically a strategic value of our innovation.
Lars Holme, CFO, Elliptic Labs: And
Lila Danielson, CEO, Elliptic Labs: we have been focusing our portfolio is designed to support long term differentiation and provide flexibility as the market evolves. Okay. So you know as the of course as the competitive landscape shifts we believe our IP will of course continue to be valuable asset both in protecting our position and enabling future opportunities. So licensing IP, yeah, of course that is a potential also that we we are evaluating.
Lars Holme, CFO, Elliptic Labs: You
Lila Danielson, CEO, Elliptic Labs: see I’m just gonna get some more
Lars Holme, CFO, Elliptic Labs: Yeah.
Lila Danielson, CEO, Elliptic Labs: More tap.
Lars Holme, CFO, Elliptic Labs: Tap pressure. It’s a product. When launching the laptop tap sensor, were asked at the Q and A if this could be a product for the smartphone vertical. At the time, you saw the product as a laptop specific product. What what has changed since you now launched on the mobile tap sensors?
Lila Danielson, CEO, Elliptic Labs: Well, so initially our decision to focus on the laptop market was the strategic one. Yeah. Okay. So the segment allowed us to you know command a better pricing as we also see even from our HPD and so forth. Yeah.
And also this we knew by working with Lenovo, this is going to provide a high external visibility through this leading OEM. Yeah. And it also enable us a deeper collaboration with the key ecosystem. So this player, with with Intel. We work very closely with Intel on this Product.
Project. So the success of this launch, obviously, it’s been very visible for Lenovo. Have been promoting it a lot, getting really good market feedback. So it’s validated the market need and demonstrated the broader potential for seamless or tap sensor. So now building on that momentum we see a clear opportunity to extend the product into the next vertical, the smartphone space.
And obviously expanding our addressable market.
Lars Holme, CFO, Elliptic Labs: Yeah.
Lila Danielson, CEO, Elliptic Labs: While we are leveraging the same underlying technology.
Lars Holme, CFO, Elliptic Labs: That’s very good.
Lila Danielson, CEO, Elliptic Labs: Yeah.
Lars Holme, CFO, Elliptic Labs: Other laptop contracts other than Lenovo gone completely cold?
Lila Danielson, CEO, Elliptic Labs: Nope. We are continuing working with our laptops, OEMs.
Lars Holme, CFO, Elliptic Labs: Yeah. And back to smartphones, how do you estimate the growth potential in mobile for the coming years? Both adoption of more models and more products?
Lila Danielson, CEO, Elliptic Labs: Yeah. So we we expect to even add more customers and we expect to run roll out more models with more products per device. Mhmm. That’s what that’s that’s what we’re seeing in our pipeline.
Lars Holme, CFO, Elliptic Labs: Excellent.
Lila Danielson, CEO, Elliptic Labs: Are there more questions? Let me see. Alright. Well, thank you very much. Appreciate it.
Have a good day. Thank you.
Lars Holme, CFO, Elliptic Labs: Thank
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