Thank you. Hello, everyone, and thank you for joining today's webcast, which is a week earlier than planned.

With me today is our CEO, Gianfilippo Testa, who joined in August 2026, and our CFO and COO, Nikolaj Wendelboe. They will take you through the Q1 performance.

Please pay attention to the disclaimer on slide 2, and move to slide 3. I will now hand over to Gianfilippo.

Thank you, Cristina. Hello, everyone.

I'm Gianfilippo Testa. It is good to meet you here at this conference call in connection with the trading statement for the first quarter of the 2026/2027 financial year.

I have now been with Bang & Olufsen for almost couple of months, and I'm thrilled to be here. Bang & Olufsen is a distinctive brand with a century-long heritage, a strong culture of innovation, and a unique position at the intersection of technology, design, and craftsmanship.

It is a honor to be now working closely with the Board of Directors, the leadership team, employees, partners, and clients around the world to build on these strengths and unlock Bang & Olufsen full potential. We have established our new executive leadership team with Nikolaj and with Jesper Hessel, who will join soon as Chief Commercial Officer and Deputy CEO to contribute unfolding Bang & Olufsen full potential.

Let's please move to the next slide. The Q1 results show that the strategy is moving the business in the right direction.

We are indeed seeing progress in the branded channels, and our win cities are delivering a double-digit sell-out growth, leading to an overall improved gross margin. However, certain areas of the business still require more attention and consistent execution.

The store footprint has been improved significantly over the past couple of years, but there is still more to do to improve our productivity across all channels. We need to look at our client experience across all brand touchpoints to ensure a consistent approach with the right tone of voice to drive demand and conversion.

Since January 2026, the business have evolved the commercial operating model, and we have significantly improved the coordination of marketing planning and investments, retail execution, and product launches. Our operating model is now better equipped to support our targeted market positioning, and we will improve it even further going forward.

We will elaborate on our plans in connection with the H1 report in January 2027. Let's please move to the next slide.

Let me take you through the business highlights of the quarter before I hand over to Nikolaj to cover the Q1 performance in more detail. During the quarter, we opened stores in key locations, and I want to highlight two here.

In June, we opened our largest store in Asia Pacific at Scotts Square in Singapore. This was a relocation and the first with our culture store concept in Southeast Asia.

The store has been off to a good start. In August, we opened our first store of 260 square meter in Palo Alto in California, and this completed the three planned California openings alongside our San Francisco and West Hollywood flagship stores.

On the product side, we launched our Beosystem 9000c Dune Grey edition, launched under the Recreated Classics Program. Finally, we announced our new brand ambassador in July.

John Legend, the American multi-platinum musician, producer, and Emmy, Grammy, Oscar, and Tony-winning artist, was appointed global brand ambassador. We are very excited about this partnership and looking forward to the collaboration in the coming years.

With that, I will hand over to Nikolaj.

Thank you, Gianfilippo. I will now go into more detail on our Q1 numbers.

Let's move to slide number 7. Starting with sell-out.

Like-for-like sell-out grew by 7%, and our branded channels grew by 14% with double-digit growth across all three channels. The multibrand channels reported a decline year on year.

We are pleased to see the progress in our branded channels. The decline in etail was mainly due to a generally changed purchasing pattern at Amazon Prime Day.

In addition, we had deliberately reduced our promotional activity on the platform, lowering both the level of discount and the number of products included. We did this to support our brand positioning.

Looking at the regions. In EMEA, a like-for-like sell-out grew by 6%, supported by our branded channels, in particular company-owned stores and monobrand.

Multibrand and etail both declined by double digits. In the Americas, like-for-like sell-out declined by 2%.

The branded channels grew by double digit, while etail declined by double digit, which more than offset the growth from company-owned stores and ecommerce in particular. In APAC, like-for-like sell-out grew by 14%.

Branded channels grew by a double digit, supported by growth across the channels. Multibrand delivered high double-digit growth, while etail saw a single-digit decrease.

Finally, our win cities delivered 19% collective sell-out growth with growth in all five cities in the index. That is the ninth consecutive quarter of double-digit growth.

Please move to the next page. Turning to group performance.

Revenue grew by 2.2% in local currencies and by 2.5% in reported revenue to 530 million. The growth was driven by APAC, which grew by 11.5% in local currencies across all channels, while EMEA and the Americas both declined.

Within branded channels, revenue grew by 9.9% in local currencies and 10.5% in reported revenue. Company-owned stores and our own ecommerce both delivered double-digit growth, and the monobrand channel reported single-digit growth.

Revenue from etail declined by double digit for the reasons I described a moment ago. In terms of product categories, revenue from the Staged category grew by 9%, and revenue from Flexible Living grew by 16%.

Revenue from the On-the-go category declined by 19%, reflecting lower sales in the etail channel. Gross margin continued its positive trajectory, improving to a record high 59.4%, up 0.7 percentage points year on year.

The development was driven by a shift in product mix towards higher-margin products, further margin expansion in the On-the-go category, and a higher share of license income in brand partnering and other activities where the gross margin was 95.4%. EBIT margin before special items was negative 4.3% compared to negative 5.2% in Q1 last year.

The improvement was driven by the higher revenue level and the improved gross margin, which was partly offset by one-off and timing of cost. Special items were immaterial in the quarter at positive 1 million.

Now please turn to the next page. Looking at the regions.

EMEA reported revenue of 226 million, a decline of 3.6% in local currencies. Revenue from branded channels grew by 1.2% in local currencies, driven by company-owned stores and monobrand.

The gap between sell-out and sell-in was mainly due to reduced inventory levels with our partners and the changes we're doing to our retail network. The gross margin in EMEA was 50.6%, down 3.4 percentage points from 53.9% last year.

The underlying margin development was positive. This was more than offset by a higher level of indirect production cost absorbed over a lower revenue base for the region.

In the Americas, revenue was 62 million, a decline of 1.4% in local currencies. Revenue from branded channels grew by 49.5% in local currencies, driven by double-digit growth across the channels.

This was offset by high double-digit declines in the enterprise channel and in etail. The gross margin in the Americas was 51.7%, up 12.4 percentage points from 39.3% last year.

This reflects the non-recurrence of the US tariff cost that affected the margin in Q1 last year, which drove a significantly stronger margin in the On-the-go category, together with shift in product mix towards higher-margin products. In APAC, revenue was 177 million, an increase of 11.5% in local currencies with branded channels up 16.3% in local currencies.

Revenue from China increased by 10.3% year on year, equivalent to a growth of 2.9% in local currencies. Revenue from South Korea increased by a single digit, and revenue from Hong Kong by double digits.

The gross margin in APAC was 60.2%, up 0.4 percentage points from 59.8% last year with gross margin improvements across all product categories. Finally, for Brand Partnering and other activities, revenue was 65 million, an increase of 4.1% in local currencies, driven by license income from the TCL partnership.

The gross margin was 95.4% compared to 93.2% in Q1 last year on a relatively higher share of license income. The partnership with TCL is ramping up as planned, and in September, we announced a new vertical bringing Audio by Bang & Olufsen to selected Motorola flagship mobile devices.

Please move to the next slide. On cash flow and working capital.

Free cash flow for the quarter was positive at 6 million compared to negative 135 million in Q1 last year. That is an improvement of 141 million, reflecting a higher EBITDA, lower capex, and a release of net working capital during the quarter.

It is also the third consecutive quarter with a positive free cash flow. Net working capital decreased to 313 million from 349 million at year-end.

Inventories ended the quarter at 438 million, up 20 million, mainly related to memory chips. Capex investments were 54 million compared to 58 million in Q1 last year.

Cash were 123 million, while net available liquidity was 80 million compared to 94 million at year-end. The development since year-end was driven by financing activities.

Capital resources were 330 million compared to 344 million at year-end. Year-end 2025/2026 has been adjusted for a more accurate reflection of the capital resources available to the company.

Please move to the next page. Turning to the outlook for the financial year.

We maintain our guidance for 2026/2027. Revenue growth in local currencies is expected to be in the range of 1% to 5%.

EBIT margin before special items is expected to range from 1% to 3%. Free cash flow is expected to be in the range of 25 million to 100 million.

Capital expenditure is expected to be around 270 to 310 million with the year-on-year increase driven by retail investments and product development. Capacity costs, excluding special items, are expected to be broadly flat compared to 2025/2026.

Q1 is, seasonally, our smallest quarter. As we said in July, we assume three or more product launches during the year with the remaining launches no earlier than the fourth quarter.

As such, the year is skewed more towards the end of the year than usually. On memory chips, the supply constraints we described in July persists, and the cost impact remains partly mitigated by the price adjustments implemented on July 1st with an expected net impact on the gross margin of around 0.5 percentage points and a cash impact of around 45 million, both included in the outlook.

With that, we will open up for questions.

Yes, thank you, and welcome to you, Gianfilippo. First question is for you.

I know you've been there for, what is it, 1.5 months even about that, but could you put some words on what you have seen, what you think should be focused on? You said that execution had to have more attention, just a little flavor on what you have learned so far.

Thank you for your warm welcome. I see a full potential to be unlocked in Bang & Olufsen, and this goes with what we shared already in the presentation.

As you see, the focus on the right channels where the client can really have the right experience and meet in a way the brand in the right way is paying off. When I mentioned in my statement that we need to better execute and there is more potential to be unlocked, is actually referring on giving the client the right environment to meet the brand in a consistent, in a coherent way.

This goes with everything we are working on as we speak. Then of course, I'm learning a lot in this month and half.

I've been speaking to my colleagues, partners, clients, and that's where I'm in this moment. Thanks for your question.

Thank you. Then we must speak more later on.

Question on the US, where you say that you grow 50% in the monobrand channel and then you still only grow 1% or about flat for the region in the quarter. Nikolaj, could you put some flavor on what's the difference?

I know about the ecom, but what's the difference in this huge difference in performance apart from the ecom?

Thanks, Poul. When you look at revenue performance in the Americas, we've had solid growth in our co-co stores.

We've had solid growth in the monobrand channel also partly because we have opened up stores that were not in the comparison figures, so that's of course also driving revenue up from those stores. Then what goes in the other direction is etail, as we just talked about.

Etail, especially on Amazon Prime Day, that goes actually for both Europe and the US, but as etail has traditionally been a bigger share of the revenue in the US, when we've seen and Prime Day that has been very low, lower than expected actually, then it has quite an extra impact on the overall growth numbers in Americas. Then on enterprise last year, we had some significant enterprise deals especially with Genesis that we have not been repeating this year.

These two factors together is offsetting the growth in the branded channels.

On the reported numbers, it's both supported by LA and San Francisco?

They have of course supported us the development in the monobrand channel, which is also the new stores in California.

Does that mean if we just ignore California, then it's New York business that is the clear star performer here?

When we say owned and operated, then it's only New York, of course, because this is the only place in the US where we have our own stores. Here you're also seeing high double-digit growth.

Yeah.

They are the ones outperforming versus the other near to 20 stores?

They are outperforming the other stores also on sell-out. They are.

Okay. Then on the memory, you have set aside 40 million on the cash, I was just wondering how much have you already managed to put on the shelves on memory versus what you had there as an ambition?

As I said, our inventory is increasing 20 million. This is what we have on the shelf, to speak.

It has not had a big P&L impact yet because the memory chips have not hit the COGS at this point in time, but will come later. From a cash perspective, it will be less than a quarter of the full-year cash impact that we've seen in Q1.

I would say between 5 and 10 million DKK in cash impact.

Out of the 40 million,

the main of that is on the

shelves? Hypothetically, it's about 1/4 of that?

There's a time lag between when you receive the product and put it on inventory and when you pay your supplier

on

payment terms. That's why there's kind of an imbalance where cash impact comes later than inventory impact.

Was it the 20 million delta, was that mainly related to the memory?

Mainly related to memory, yeah.

Another question. On the Motorola, could you put a little bit more color on that?

I checked, they have about 5% of the global market, mainly in the US. How much or how large a share of Motorola product lineup are you going to address with your partnership with them?

It's a smaller share of the full lineup because it's only in the high-end phone that we are in. We are expecting some positive impact from this partnership this year, not a lot, and then we expect it to ramp next year.

We don't necessarily expect it to ramp to the same level as we would have seen from a TCL agreement because it is in the high end of really, really top-end models that we are in. This is probably what we can say at this point in time.

When it will be at some time in the future at peak volumes, is it then a material number into your account? I'm just comparing to Ford or where HP were in the past.

If Ford and HP in the past is what we call material, then it will not be material. I think from the overall license income projections that we have, then it's still a decent contribution.

Okay. I'll step back for now.

Thank you.

Good morning, and thank you for taking my questions, and welcome on board to Gianfilippo. My first question would be on your gross margin for the APAC region.

Could you talk about the material jump that you presented for the gross margin in the APAC, what's behind that? Secondly, could you talk about if etail will remain a headwind to your growth here in the next three quarters of this fiscal year?

Then finally, could you elaborate a little bit more on your store pipeline in terms of store openings? Thank you.

Thank you for your welcome as well. I will take the last two questions, and I will start with those.

Concerning the etail and actually the two questions, the second and the third question for me are in a way can be combined into what we do for distribution. I think the job the team we started to do already that we need to push forward is to requalify our distribution.

When I say requalify means making sure that the brand positioning match the quality of the traffic in our distribution. Obviously etailer is a channel that is more promotional driven.

As we are working to reduce the promotion-led business, which is, as you see, paying off in having a better margin, more qualified, let's say, top line revenue in our branded channel, obviously etailer is not going to be the channel where the growth is going to come from. When we go to the distribution itself, the number of stores, we are not planning, as it stands, to do more business opening more stores, but focusing more in the like-for-like, bringing again better execution in the distribution that is already in place.

These are my answers to the two questions. Then I let Nikolaj reply to the first one.

On gross margin in the APAC region, which is growing, it's down to basically mix of channels and mix of products. The growth in the region is driven by the branded channels, is driven by our co-co stores in Hong Kong of course, but also the monobrand channel in the rest of the region.

Then we've also done less discounting on etail in APAC as well, especially for the June 18 event. That's the underlying reasons for the improvement in APAC.

Great. Thank you.

Finally, can you just talk about the growth that you recorded in China, to what extent is that driven by your internalisation of distribution in China, and when will that year-on-year effect phase out?

That effect is phased out now, the growth in China is not attributed to the takeover of Tmall. The growth in China is attributed to development in monobrand and multibrand, for that matter.

Okay. Great.

Thank you.

Yes, thank you. That's for you, Nikolaj.

It's on the comment that you had made an adjustment for the capital resources by end of last year. Can you put a few words on what actually you changed here?

Yes. We have just made a true reflection of what is the underlying capital resources for the company.

It consists of our cash position plus our net bond position that we are having, plus our available recurring credit facility that has not been drawn. These three figures together amount to 330 million, which is the right way of looking at the capital resources for the company.

What have you eliminated?

We had in the annual report adjusted the available RCF in the wrong way. We had adjusted it more than what was correct, given that the draw that we had on the RCF was changing over the quarter in Q4, and that we didn't reflect in the right way.

Okay. Thank you.

That's all for me.

Thank you for your interest in Bang & Olufsen and for joining today's webcast. I look forward to engaging with you in the coming weeks and months.

If you have any follow-up questions, please do not hesitate to reach out to our investor relation team. Thank you, and have a good day.