GN Store Nord A/S

Hello, everyone and welcome to GN’s Conference Call in relation to our Annual Report announced this morning. Participating in today’s call is Group CEO, Peter Karlstromer; Group CFO, Soren Jelert; and myself, Rune Sandager, Head of Investor Relations.

The presentation is expected to last about 25 minutes, after which we will turn to the Q&A session. The presentation is already uploaded on gn.com.

And with that, I’m happy to hand over to Peter for some opening remarks.

Thank you, Rune, and thank you all for joining us today. In ‘24, we demonstrated that we are on track to deliver on the intended results from our transformation into a simpler and more efficient one company setup.

We delivered strong profitable growth, resulting in a very healthy cash flow. We have strengthened our foundation to allow us to invest further in the business to ensure sustainable and profitable growth in order to reach our long-term targets.

In ‘24, we navigated in mixed market conditions, resulting in different growth outcomes for our three divisions, but a broad cost focus and the synergy realizations have resulted in improved margins aligned with our one-GN strategy. In Hearing, we continue to deliver very strong performance in a market that grew slightly below historical growth rates following a very strong market in ‘23.

In ‘24, we managed to grow 10% organically, which was on top of the 13% organic growth we delivered in ‘23. This was achieved by our highly successful Nexia hearing aid portfolio and our partner approach model.

Our growth was broad-based across regions and channels. In addition, we managed to further improve margins driven by the strong execution of top line and cost control as well as a positive influence from the one-GN transformation, while also investing in future technology leadership, which is exemplified by our recent announcement of ReSound Vivia, which I will get back to later.

In Enterprise, we have seen a stabilization of the market throughout the year, and we continue to remain optimistic about further market improvements into ‘25. We maintained our market-leading position in headsets and gained market shares in video.

And even the market didn’t perform and improve at the level we anticipated in the beginning of ‘24, we managed to improve the margin profile driven by strong pricing discipline and our one-GN transformation. In Gaming, we had a very strong finish to the year and gained market share in a slightly growing gaming market.

SteelSeries was back at double-digit growth in Q4, underlying a strong innovation and robustness of our business. In fact, Q4 was the strongest quarter ever for SteelSeries, even surpassing the high COVID levels.

The Gaming division has also benefited from the one-GN transformation, already improving the margin profile and setting the division up for further margin improvements in the years to come. We ended the year successfully concluding the wind-down of the Elite and Talk product lines, and can now in this division fully focus on growing our gaming business while continuing improving our profitability.

On a group level, we have also taken big steps in improving the margin profile. The one-GN transformation has developed favorably during its first year where we have delivered a total company-wide synergies of around DKK430 million, slightly ahead of our original plan.

During the year, we have implemented changes to ensure a flexible and resilient global supply chain. We have also further integrated our research and development teams to utilize scale, talent, processes and facilities to accelerate our innovation.

On the finance side, we have streamlined operations and established a shared service center in Poland. We have done this while also building a stronger culture, defining new leadership principles and significantly improving the ESG agenda, including helping more than 11 million people with hearing loss around the world and reducing our scope 3 carbon emissions by slightly more than 25% compared to ‘21.

In summary, we are very pleased with our execution and progress during the year. We have created a stronger GN and prepared for future sustainable growth in order to deliver on our long-term financial targets, which we announced at our Capital Market Day in May.

With this introduction, I’m happy to hand it over to Soren for further details on the group performance for the year.

Thank you, Peter, and thank you all for joining us today. Essentially, as Peter mentioned earlier, we feel good about the progress we have made in ‘24 and financially we are delivering on our commitments.

In summary, we delivered 1% organic growth for the year, supported by a 10% organic growth from our Hearing division, a negative 3% organic growth from our Enterprise division and a 7% organic growth from our Gaming division, and lastly, a negative 31% organic growth from our consumer wind-down – due to the wind down. If we exclude the wind-down effect, organic revenue growth for the group would have been 4%.

Our improvement in gross margin supported by the strong cost focus and company-wide synergies led to a 79% increase in reported EBITA, which translates into an EBITA margin of 12%, 5.4 percentage points higher than last year. The increased profitability also influenced the free cash flow generation positively where we ended the year with a DKK1.1 billion in free cash flow, excluding M&A, and reduced our leverage further.

Moving to the financial details on Slide 6. As previously noted, our 3 divisions executed strongly, generated a 4% organic revenue growth, excluding the wind-down, and a 1% in reported organic growth.

Despite the mixed development on top line across our divisions as well as the wind-down of consumer and retail disposals, the gross margin increased to 53.2% compared to 49.4% in ‘23. This was driven by our strong pricing discipline, synergy realizations and positive business mix.

As for the company transformation initiatives, we realized synergies of around DKK430 million during ‘24, which was slightly ahead of the plan for the year. Reported EBITA grew 79%, equal to an EBITA margin of 12.0%, compared to a 6.6% in ‘23.

The strong improvement in margin reflects the gross margin improvement across our divisions, but also company-wide OpEx benefits from the one-GN transformation and less extraordinary costs. With that, let’s move to Slide 7 and more details on the free cash flow generation.

Our solid earnings level led to a positive cash flow generation of DKK1.1 billion. The strong cash flow generation was driven by a solid operational cash flow, while the impact from working capital was slightly positive.

2024 included a small tailwind from changes in the working capital, which was predominantly a result of the slightly higher payables as the positive effect on inventories was offset by very strong revenue finish to the year, driving up receivables. With a solid cash flow generation, we have been able to reduce our net interest-bearing debt.

And with the improving margin profile, our adjusted leverage ended at 3.5x compared to 4.5x last year, another important step in our deleveraging plan. And with those group highlights, I’m happy to hand you over to Peter for additional color on the three divisions.

Thank you, Soren. And let me start with the Hearing division.

In ‘24, we continue to drive market share gains, thanks to the success of ReSound Nexia. As a result of our strong execution, we grew organically by 10% on top of a very demanding comparison from ‘23 where we grew 13%.

The growth was broad-based across regions and channels. The gross margin of 62.8% reflects a strong increase from last year despite the retail disposals, including BelAudicao and Dansk HoreCenter.

This was driven by continued success of ReSound Nexia and group synergies. Sales and marketing costs decreased slightly compared to last year, supported mainly by retail disposals.

As a result of our strong top line development and prudent cost management, we delivered a divisional profit margin of 34.7%, which was an improvement of 7.1 percentage point compared to last year. For our core hearing business, we’re also happy to confirm that we delivered an EBITA margin of 20%, showcasing the success of our partner approach model and the one-GN strategy.

Our OTC business, jabraenhance.com, delivered a very strong double-digit growth for the year. We are satisfied with this development and remain committed to breakeven with this business late ‘25 to early ‘26.

Let’s move to Slide 10 for some exciting news within Hearing. This week, we proudly announced our next hearing aid platform, ReSound Vivia.

With this new platform, we’re introducing a revolution within signal processing with the help of AI. This is a change of the same magnitude as when we went from analog to digital hearing aids decades ago.

With Vivia, we bring hearing aid wearers a human approach to AI, using the world’s most efficient AI algorithm on a dedicated DNN chip that is trained to real-spoken synthesis to bring a real difference to the wearer. The development has been built on decades of shared AI and machine learning research across the GN Group, which will influence our total company over time.

Most importantly, the benefits for the wearer are tangible. By combining DNN with our core processor that gives it the most narrow and precise beam former, we can offer the world’s best hearing in noise environments.

We achieved this while preserving cues in the environment so you can focus on what’s most important to you and not feel as if you are cut out of the world around you. This breakthrough technology is packed in the world’s smallest rechargeable receiver in-ear hearing aid.

It’s the same size as ReSound Nexia. On top of that, ReSound Vivia hearing aid wearer will experience a full day of battery without any compromise, even with screaming or having AI active, so you can keep on hearing in an uncompromised way.

And finally, ReSound Vivia naturally connects to Bluetooth Low Energy and Auracast. And with our new Auracast Assistant, we enable everyone to enjoy and connect to Auracast even if the mobile device is not compatible yet.

We’re really taking the lead on the next era of connectivity. In short, with ReSound Vivia, you can have it all.

It does not stop there, though. We have also this week launched the ReSound Savi platform, our new essential hearing aid that is important to our business in many geographies around the world.

We are bringing Bluetooth Low Energy and Auracast broadcast audio into Savi, ensuring that even more people with hearing loss can experience the latest in connectivity and innovation. With the exciting launch of ReSound Vivia and ReSound Savi, let’s move to Slide 11 and share some expected perspectives on ‘25.

As visualized by the graph to the left, we are exposed to an attractive and resilient hearing aid market. We continue to believe in a 4% to 6% annual volume growth in line with history, driven by favorable demographic trends and an increased adoption by a globally growing middle class.

With some minor ASP erosion, this translates into an annual value growth of 3% to 5%, which is also base assumptions for ‘25. During ‘24, we have seen a broad-based success across all 3 regions and across all channels, which has enabled us to further grow our global share.

We look forward to continue our strong momentum with the launch of ReSound Vivia and ReSound Savi, and aspire to gain further market share across our regions in ‘25. Let’s move to the next slide and also share some highlights on the performance on Enterprise.

The Enterprise division successfully maintained its market-leading position in a gradually improving market. The division realized negative 3% organic revenue growth for the year, while the organic revenue growth in Q4 was negative 2%, confirming an improving trend.

Despite the negative top line development, gross margin improved to 55.7% compared to 52.3% last year, primarily driven by strong pricing discipline and group synergies. Our sales and distribution costs were approximately flat, reflecting targeted channel investment to benefit from an improving market while also controlling costs well in other areas.

Divisional profit margin ended at 35.3%, which is an improvement of 2.6 percentage points compared to last year, driven by gross margin improvements and a stable development in sales and distribution cost. Moving to next slide.

As mentioned in our Q3 presentation, we have seen different development with our different product categories. In Q4, we saw a continuation of the market improvements we have seen throughout the year.

The headset business continued to gradually strengthen. In video, we experienced continued double-digit growth, while our speaker phones declined significantly, however, to somewhat lesser extent in Q4 than the prior quarters.

In summary, for ‘24, we had a negative 3% growth in Enterprise, primarily driven by the speakerphone category, which experienced a weak market and difficult comparison to last year. Let’s move to Slide 14 and talk about ‘25.

The headset market has now experienced 3 consecutive years of decline after the rapid growth during the COVID pandemic. More positively, we believe that we’re coming to the end of this adjustment period.

Recent indications suggest increasing IT budget levels and improving sentiment across distributor, resellers and end customers. Also, if we look at Q4, we saw a growth in terms of our sell-out from the channel in both North America and the rest of the world and also several parts in Europe.

There are some remaining markets are in Europe, in particular in Central Europe, with negative growth. In total, with these forces in play, we expect a modestly growing market in ‘25.

Also, our R&D teams are focusing to bring a lot of new innovation into Enterprise. This week, we launched PanaCast 40 VBS, which is built on the GN group’s unique sound and video processing capabilities.

And this is the first 180-degree field of view Android-powered video bar designed for small rooms. With innovation, we’re essentially bringing many of the same benefits from the PanaCast 50 into more compact and cost-effective solution that will help companies bring video into every meeting room.

This is in line with our strategy to gradually broaden our portfolio to cover every room type and also both premium and entry-level offerings. Earlier in the year, we also announced the launch of Jabra Perform 75, a new headset that is purpose-built for retail workers and future-ready for AI-supported voice-led applications.

We have, during the last 18 months, also upgraded our industry-leading headset portfolio to meet the new legislative standards around USB-C and battery replacement. While we have done this, we have also taken initiatives to strengthen the performance of several products.

As an example, we recently upgraded our Speak2s to also enable now linking several devices together to have an even more flexible solution. In parallel with this, we’re also working on new headset innovation to knowledge workers, and we very much look forward to gradually bringing this into the market starting towards the end of this year.

And with that, let’s take a closer look also on the Gaming and Consumer division. In our Gaming and Consumer division, we delivered organic revenue growth of negative 5% compared to last year, driven by the wind-down of our Elite and Talk product lines.

Our gaming business grew organically with 7%, reflecting market share gains in a slightly growing market. The performance in Q4 was especially strong, delivering 16% organic revenue growth on top of 70% last year.

Our Consumer business declined 31% organically, purely driven by the wind-down of the Elite and Talk portfolio, which is now completed according to our plan. Our gross margin for the division increased 5 percentage points to 29.8% despite significant promotional activities related to wind-down and the extraordinary cost.

The underlying improvement is reflecting the strong top line performance in gaming, group synergies and strong pricing discipline. Sales and distribution costs grew 22%, reflecting extraordinary costs related to the wind-down, but also channel investment and marketing activity to support continued market share gains in gaming.

Altogether, the divisional profit margin ended at 5.4% for the year, which reflects a negative effect from the wind-down. Moving to Slide 16 and some flavor on ‘25.

The gaming market is structurally attractive and influenced by continuing increase in the number of gamers around the world and the time they are spending in gaming. For the benefit of SteelSeries premium product portfolio, there is a growing appetite for premium features supporting high ASP levels.

While we project a healthier market around 3.5% in ‘25, this is also including some headwind from the current situation on consumer sentiment in parts of Europe. Even though SteelSeries have gained significant market shares for several years, we do believe we can continue to drive even higher share in ‘25 based on our winning strategy and strong portfolio.

We will continue to help gamers win by providing industry-leading products tailored to the gamers’ needs. In addition, we will continue to develop our software services to enhance the gaming experience even further.

Our software adoption is growing rapidly and is supporting the growth of SteelSeries in a healthy way. In summary, SteelSeries was created by gamers for gamers, and we very much look forward to continue to develop the business in that way.

Our long history of close collaborations with professional e-sports team, tournaments and streaming providers give us a unique position to further grow our business into the future with aim to help gamers win around the world. In ‘24, we also took the step to strengthen the SteelSeries operations and supply chain by integrating it into the same system and product flow as the Enterprise business.

While some margin improvements were seen during the year, we expect further improvements in the division as we’re fully utilizing the scale of GN. And with that, I’m happy to hand it back to Soren for the financial guidance.

Thank you, Peter. For ‘25, we expect an organic revenue growth, excluding the wind-down of 3% to 7% driven by continued strong execution across our 3 divisions.

Moreover, we are guiding for a reported EBITA margin of 12% to 14%. The solid absolute earnings level is expected to contribute to a healthy cash flow levels, while we are guiding for free cash flow, excluding M&A, around DKK800 million.

All in all, the financial guidance supports our sustainable and profitable growth journey and additional steps in the one-GN transformation that eventually will lead to realization of our long-term targets. This guidance is based on a number of assumptions across markets and own execution, which Peter briefly touched upon earlier.

This leads me to Slide 19. For the hearing aid market, we expect the market growth for ‘25 to be in line with historic growth rates with a global volume growth of 4% to 6% and a slightly negative ASP development.

In this healthy market, we are assuming that we can continue to gain market share driven by our development and recently updated product offerings and channel execution, while we are assuming an organic revenue growth of 5% to 9%. For the enterprise market, we believe that the continued stabilization we have seen during the past year will materialize into a modest market growth in ‘25.

We continue to see some indications of increased IT budget spend for the year as well as an improving sentiment from our distributors, resellers and end customers. In addition, we observed growth in North America, rest of world and parts of Europe during quarter four.

In this market, we assume that we can continue to maintain our leading global market share position in headsets while expanding our market share in video collaboration. As a result, we are assuming an organic revenue growth of 0% to 4%.

For gaming, we expect the market growth for ‘25 to be slightly below its structural assumed market growth and hence, project the market to grow 3% to 5%. In this market, we are assuming continued market share gains in gaming, driven by our current momentum and strong product roadmap that translate into an organic revenue growth assumption of 7% to 12%.

However, it is important to stress that this assumption excludes a negative impact from the wind-down. In reality, the reported organic revenue growth of gaming would likely then be 19 to 20 percentage points lower as the ‘24 base includes Elite and Talk product lines.

All in all, applying these assumptions leads to a guidance on group organic revenue growth, excluding the wind-down of 3% to 7%. Moreover, as mentioned earlier, we do not assume that the Elite and Talk product lines will contribute to any significant revenue while the negative impact of the wind-down is assumed to be 3 to 4 percentage points compared to the realized levels of ‘24.

Moving to Slide 20 and the margin guidance. First and foremost, it’s encouraging to see that our strong attention to margin expansion is evident in the ‘24 numbers.

In ‘24, we took a significant step forward by delivering an EBITA margin of 12%. This is exactly the plan we put forward at our Capital Market Day back in May of ‘24.

At that time, we mentioned that they were planning for a significant margin expansion in ‘24. But from here, a more evenly distributed margin expansion towards ‘28.

Despite investments and external headwinds, we do expect further margin expansion in ‘25 and the investments we are now executing should support our long-term margin aspiration. Specifically in ‘25, we will experience a margin tailwind from the additional one-GN synergies that comes on top of the DKK430 million realized in ‘24.

Moreover, we will naturally see a margin tailwind from the nonrecurring nature of DKK202 million extraordinary wind-down costs incurred in ‘24. Finally, we will continue to focus on increasing underlying profitability levels in general, driven by leverage, but where the size will be correlated with the top line.

However, the guidance does also include a negative impact from certain costs directly linked to the wind-down for the service and warranty commitments. These are expected to diminish over the next couple of years, and you should assume headwinds of around DKK50 million.

To solidify the margin path towards ‘28, we will, in ‘25, invest further into operations, including supply chain IT modernization, ERP optimization and cybersecurity to ensure a sustainable and resilient growth platform. This will allow us to drive the targeted margin expansion while further creating flexibility and resilience against current and potential further geopolitical challenges.

The recently announced tariff between China and the U.S. is expected to lead to a slight negative margin impact for the group in the area of 0.5 percentage points, mainly in Gaming and to some extent in Enterprise, while no impact is assumed in Hearing.

While it is impossible for us to predict the outcome of the geopolitical challenges, we are taking into account what we know today. However, with the tariffs we are aware of today these will be temporary for GN as we continue our manufacturing diversification.

Finally, assuming current FX rates prevail through ‘25, we will also be negatively impacted by the recent development, not least by the appreciated U.S. dollar.

This will be a tailwind to revenue, but a headwind to the reported EBITA margin as the majority of the negative FX impact in absolute EBITA is hedged. All in all, this is likely a headwind in the magnitude of up to 0.5 percentage points on the EBITA margin.

And with that, I am happy to hand you back to Rune.

Thank you, Peter and Soren, for the updates. And with that, I’ll hand over to the operator for the Q&A.

Please limit your questions to two at a time.

Hi, good morning. Thank you for taking my questions.

Two from my side. The first one on the guidance, can you please help us to put into perspective the 12% to 14% EBITA guide?

What are your assumptions backing the top end and the lower end? And as a follow-up, what do you have in the lower end in terms of tariff, competition in hearing and recovery in audio assumptions?

And the second one on hearing on ReSound Vivia, congrats on launching the new platform, can you give us any details on the phasing of launch, especially in key geographies and channels? And as a follow-up, if you can confirm you aim to launch in the VA in May?

Thank you very much.

Thank you very much for your questions. In terms of the guidance on the EBITA margin of 12% to 14%, for us, of course, it’s important as we stated here in the initial comments that we are seeing an improvement in GN on the margin that is well aligned with the trajectory for us on our long-term EBITA margin of 16% to 17%.

We are expecting the midpoint to be the best estimate between the 12% and the 14% as that’s normally good practice. And here, we have taken into consideration, as we say, the FX and the tariff.

And then especially what then will be improving it will be further, of course, driving to the high end of the top line, which will yield an improvement for us and equivalent, of course, the lower end being the lower end of the revenue side. That remains still to be the two most predominantly drivers of this spread for us.

Rest assured that we management, of course, all the time also are working on our synergies. And of course, some of that is then also to the upside if that comes out well.

So I think overall, we look at it as a very balanced outlook and as an anchor in the middle between the 12% and the 14%.

And let me continue with a question here on Vivia, essentially, we plan to rollout Vivia following the same rollout approach as we have been having for Nexia. So how that will play out is that starting a few weeks into February, we will start to put Vivia into parts of the U.S.

channels and also slightly thereafter into the larger markets in Europe, starting with Germany. And then you should expect that into Q2, we will put it into – I mean, the full U.S.

business as much as we can and then also gradually roll it out market by market where we prioritize larger markets and there are also some kind of approval process for every market determining how we will phase it. And then lastly, VA, it’s absolutely our intention to have Vivia in VA.

As you probably know, there is an ongoing negotiation process here with VA, but we believe confident that we should be able to succeed with this and then launch in May there as you suggest.

Thank you very much.

Good morning. Thank you for taking my questions.

A couple from me. So just on tariffs, what is the timeline to shift manufacturing for both Gaming and Enterprise?

And do you expect this to be completed this year and how are you thinking about the potential for any European tariffs? Secondly, on margins, I appreciate around 100 bps of headwind from tariff and FX to the margin for ‘25, but the margin guidance is still softer than we thought.

Can you elaborate on the margin building blocks and quantify the investments planned for 2025 and what you deem to be the drivers of any potential upside to the top of the range? Thank you.

Okay. Thank you.

So when it comes to the tariffs, taking a step back, I mean, we are taking quite some initiatives already to diversifying our global operations and supply chain, and essentially going from a relatively China-centric manufacturing footprint to have a much more diversified. And there we are already today.

So when we are saying that we see some effect on Enterprise and a bit more effect on Gaming, that reflects exactly how we set up today. We will, of course, take every step we can to further diversify, and this is actually something we were doing regardless of these tariffs.

We’re really trying to set us up to have all the flexibility we can to cater for different scenarios here. So when we say 0.5% impact, that already takes some mitigation in place.

And these initiatives we will continue with. So I cannot give you a precise estimate, but you should assume that over time, we can work ourselves out of any type of impact like that.

And then to your question on Europe, we do not have any significant manufacturing in Europe. So we do not feel exposed in that way.

With that said, we, of course, need to understand exactly what kind of policy that might be implemented. But our assessment is that that’s a limited risk for us.

And then again, of course, similar a little bit to the answer before on the guidance on the EBITA margin. We think we have a pretty firm midpoint of our guidance between the 12% and the 14%.

And for us, of course, we are extremely proud about the launches we’ve just done in hearing and also with the video bars. And it is, of course, clear that modernization of our portfolio in our mind at least can also lead to an improvement on our profitability on the upwards ranging trend.

So that is what will support us. Then when it comes to the negative, it is truly also so that a little bit depending on how the mix pans out.

As you know, we have a different profitability levels across our businesses and that, of course, it can be sensitive to on the lower levels. And then finally, we have said in here what we know on tariff today and on currency today.

And of course, that can also fluctuate and give a range on how it impacts us. But overall, with what we know today on tariffs, we think we have the right plan, and it’s a plan we have communicated on for quite some time.

So we feel good about that. And then finally, I think it is really important to remind all of us that the path we have now shown in ‘24 with a good uplift on profitability with further improvement here in ‘25, that is a clear indication that points towards the right trajectory towards the 16% to 17% EBITA margin for the group.

So for us, this is definitely a step in the right direction with the ‘25 outlook we have.

Thanks a lot.

Yes, this is Martin Parkhoi from SEB. Two questions, both related to hearing aids.

Maybe, Peter, you could speak a little bit to the 5% to 9% you’re guiding for 2025. Are there any channels or regions you believe are sticking out?

And maybe you can make a specific comment on Beltone. How is that doing?

Is that also growing within that range? And then secondly, on ReSound Vivia, where you gave a quite impressive speech about the benefits of Vivia?

And I was a little bit curious about because I’ve gone through the white paper and read how you have tested the product up against other AI-powered hearing aids, particularly for them from Switzerland. And I can see that you have done it in a pretty mild noisy environment.

And everybody knows that, that product is doing very well in a very noisy environment. Have you also tested it in other noisy environments than this very mild environment?

Thank you, Martin. So starting with the guidance here, I mean we are giving a range here, and you should take the midpoint here as the most likely.

And we are guiding here to grow faster than the market, thanks to both good momentum, but also our belief in Vivia. When we look on how we will build up the year, I think it’s fair to assume that Q1 will be a little bit slower growth.

And then as we’re rolling out Vivia, the growth will be built up throughout the year. I think it’s also fair to assume that you will see more growth in the U.S.

in the early parts here as you did with Nexia and then that to be picked up around the world as we are launching into the other market. I think it’s interesting to see actually how we performed this last year where it really played out like that.

I mean the first half was very strong in the U.S. and second half, I mean, really, the rest of the world picked that up, and we’re actually growing the strongest towards the second half.

And I think we will see a similar dynamic here. But altogether, we do not see any specific challenges per se.

I mean every channel, as you know, is behaving slightly differently, but it helps with really great hearing aid, and we will work to drive success broad-based. I mean on Beltone, I mean without going too deep into, I mean, individual channel types, I think it had been following a bit the same.

We’ve been having a period of very strong growth with Beltone and then more modest growth. Certainly, the launch now of Vivia will support growth also in the Beltone network.

That’s how we think about it. Then when it comes to Vivia, I mean, in terms of the study, I mean we have published them as well as we can.

You can always have an argument on exactly how you test, and it is a difficult science. But we have really tried to test it in natural environments to mimic where people spend their life and where our users are using the hearing aids.

And we have done that to really make sure we develop a strong hearing aid. And the outcome of this is something we’re really proud of and very much believe in and we do think it will really help anywhere in a great way.

So we do feel confident about the benefits we bring into the market here.

Thank you.

Hi, thank you very much for taking my questions, Soren and Peter. I have two questions, and I’ll direct them over to Enterprise instead for a moment.

And then just the first question would be on the exit run-rate in Enterprise, can you maybe give us a little bit of color on how that looked like? Because when we were in November, you were talking about sell-out rates around minus 3% and now the quarter ended around minus 2%.

Does that mean that you had a quite strong December? And has that continued into the beginning of the new year?

That’s the first question. And then on the second question, I’m sorry but analysts always want more.

Now you have two product launches that you need to cater. But you have also alluded earlier to a headset launch, which is the biggest category.

How does the product launch roadmap look like in Enterprise from here? That’s the second question.

Thank you.

Thanks a lot. Now starting here, I mean in Q3, we saw some improvements, and I would say we have seen a continuation of that.

So, as I highlighted in the opening here, I mean if we look on sell-out from the channel, which tend to be the most robust way of viewing the market and also very much a leading indicator for future growth, I mean we saw growth in a healthy way in the U.S., in APAC and rest of the world and actually even parts of Europe. Specifically in the quarter, I mean our sell-in and sell-out in aggregate were fairly balanced in the quarter.

So, I think as such, I think we are entering the year in a balanced way with some improving trends. And I think it’s fair to assume that whatever we know about January, we have been factoring into our guidance as well.

With all that said, I do think as you are thinking about growth in enterprise for the year, I do expect growth to be built up during the year. And in the same way, it’s been gradually strengthened.

We think that will continue. So, it will likely be a bit stronger performance throughout the year.

And also a bit linked to this about product launches, we do expect to launch new innovation into the headset category more towards the end of the year, and that’s something we look forward to. We have already made some more optimization, you can say, of the portfolio to make it ready for legislation like battery replacement, USB-C and others.

And we have actually upgraded the performance of several products, which we are not making big announcements around, but it’s certainly something our customers knowing our products really appreciate. But more new innovation around the headset is more towards the end of the year.

And it will be a gradual introduction. We have a broad portfolio, as you say.

So, we will gradually work them to refresh the portfolio, but some initial announcements towards the end of the year.

Makes a ton of sense. Just a quick follow-up to your buildup comment, should we expect enterprise to start below the guidance and then build up, or do you think that you could start within your guidance range?

We like to avoid to guide on an individual quarter. But in some way, I mean I think I am repeating what I said, I mean we do expect the numbers to grow stronger throughout the year.

And if you take the aggregate of the year, I mean the midpoint of the zero to 4% is really what we believe is the most likely outcome for the full year.

Makes sense and congrats with the quarter here.

Thank you.

Hi. Good morning.

This is Maja. One question for hearing, one question on the enterprise side, please.

I will start with hearing. With Vivia coming and the extension of LE Auracast into Savi, I was wondering what kind of technology are you bringing to your Jabra portfolio?

And if you are not bringing it now to the Jabra portfolio, when are you thinking to bring maybe LE Audio to the Jabra portfolio? That would be number one.

And then number two, on the U.S., I mean the last two weeks, three weeks were quite entertaining or adventurous with regards to different offices being shutdown, companies calling people back to work and stuff like that. Is there anything that you believe that you are watching and saying like, we have to monitor that because there might be disruption in the market for the enterprise side?

Thank you. If we look first on the portfolio here, as you say, Vivia and Savi, here we are bringing, we think, great technology into the market, both in terms of the more upper end in a leading way, but also for Savi something which can really benefit the full volume of our business.

As for the Jabra portfolio, I assume you refer to the Jabra we have under the OTC. We are not giving any specific details on the products, exactly what we do.

But you should assume that we share in technology between our portfolio. So, for sure, it will benefit from the same innovation also there.

Exactly how we do that, we need to come back to the market around. And then the question related to enterprise, we believe this has been, of course a very strong debate for a longer period of time how we should work.

And it’s changing. I think it’s the way we are thinking about it.

Today, I mean the statistics shows that around 80% of all meeting minutes are made either fully virtual or in a hybrid way. And even if people coming back to office, it normally does not mean that everyone is sitting in the same office.

And also, when people come back into offices, still the modern office tend to have very open landscapes where people work without private rooms. And as such, I think it’s really beneficial to have a good equipment, good headset out of good collaboration equipment to be able to do that to make sure that you are heard well, but also to make sure you can get the peace at work and focus in the right way.

So, we are not worried per se that it will change the demand for our type of products. But we are monitoring carefully these type of trends to understand what type of solution we like to develop and lead around to really give the solutions that the workers and the companies need.

Great. Thank you very much.

Thank you for taking my question. Two, please.

The first one is on Vivia. Can you please provide some commentary around the pricing premium that you are expecting to realize at Vivia, considering that this comes with a dedicated AI chip and you already have another peer in the market sort of coming out there with a very big premium.

And how about ReSound Savi? How do you think about pricing for this product?

And the second question is also on Vivia. More generally, what makes you decide to pursue a dual product launch this time?

Thank you.

Thank you. When it comes to – we are always trying to have an opportunity to increase prices a bit when we are launching new products.

And as such, we will certainly take the opportunity here also with Vivia. We are bringing new strong innovation to the market, and we will do our very best to see how we can get a premium for that.

I would say though that, if we look on the cost structure of Vivia, it is a bit more than Nexia, but it’s still a very cost-efficient platform. So, the dedicated AI chip we have, I mean is adding some cost, but not in a way that is completely changing the pricing strategy or anything like that.

So, we do think that we can operate with a great performing device that still we can produce at reasonable cost levels. So, you should not expect like a huge step-up or the need to have a huge step-up to maintain our margin levels, which we feel very good about.

Actually, most of the innovation in Vivia is more on the algorithm. I mean the chip per se is of course needed.

There is a dedicated AI chip, but I think the revolution is really how we do the algorithm operates on that chip in a very kind of efficient way with great benefits. So, we feel good about that, and we will – I mean do our best to both drive healthy growth, but also to a healthy profitability.

And then when it comes to Savi, we have not communicated exactly how we will price this. But also here, I mean if we more take it from a cost structure point of view, it’s also a device with a good cost structure.

So, we have the pricing flexibility, and we will really price that in a way so we get the balance between growth and profitability around the world basically.

Thank you. And sorry, if you can also answer to the last part of my question, what makes you decide to go down the route of having dual platform launch this time?

Yes. Why we launched both at the same time?

I think essentially because we felt it was possible. I mean we have worked on both and they are coming together at a similar point in time.

And we saw benefits here also from a communication point of view, interaction with the audiologists. So, I think we are doing this because we think it’s the best approach for us to really bring it to market and really get all our channels and partners ready to support the devices.

Thank you.

Yes. Hi.

Good morning everyone. Thanks for taking my question.

So, I have two, the first one for enterprise. Can you maybe comment about the competitive dynamic for headset specifically?

I think you mentioned sort of you maintain market-leading position, but you didn’t mention share gains in this specific category. And like the question here is more, we are seeing good traction at Logitech, like including in headset enterprise.

So, I was just wondering if you also saw that at your level. So, any comment would be helpful.

The second one is on hearing around recent Vivia. Could you maybe come back on the technical specificities of the dedicated DNN chip?

How was it designed, quantify maybe decibel gains in the most noisy environments? And like also how the DNN works, is it automatic on top of the beam-former?

And I mean how can we compare it versus your peers? Thank you.

Thank you so much. Starting with enterprise and Logitech, I mean what we have seen, which I made in the opening is that, in particular, the U.S.

has been picking up quite nicely. So, it’s really good to see APAC and rest of the world as well and EMEA a little bit less so.

We do believe that Logitech also talked to the improving sentiment in the market. When you are trying to assess the growth and performance of us vis-à-vis others, I think it’s helpful to both look on the geographical differences of our businesses and also a little bit the type of products we have.

So, we are having a bit higher market share in EMEA, and I believe Logitech are a bit stronger in the U.S. So, I think that explains perhaps some differences in shorter term performance trends.

And then also, we are focusing a bit more on the premium end on the market. There is what we are stronger.

So, some of the differences in performance in a specific quarter can be related to that. But I think we broadly observed the same trends.

And when it comes to our own market shares, we are managing those for the majority of the countries where we operate. And we have seen stability over the year.

And actually, if you take it in aggregate, have seen some small gains during ‘24. But it’s something we are of course monitoring very carefully to make sure we are keeping it that way.

And then if I move more to your questions on Vivia, I mean we have essentially in the launch shared all the technical details, which we are able to and also where we have studies and so. But we can confirm that Vivia, it has a dedicated DNN chip and it is a relatively small chip, of course, because it’s fitting into the same housing as Nexia.

This has actually been something that we planned already when we did the housing for Nexia. And then I think that the most important thing here is that the chip is powerful and powerful enough to cater for the algorithm we have that we think are very kind of efficient because we have been very, very much putting attention to that.

We like to have the improvement in noise, but we also need to have efficient algorithm so they not – I mean need too much processing power because too much processing power consume too much power and will lead to difficulties with battery usage and the size of devices. So, our engineering teams have really tried here to find the optimal way of doing this, and we believe that has succeeded very well with what we have launched now this week.

Perfect. Thanks.

If I can just follow-up on your last comment about the, let’s say, processing power. I mean should we also maybe think that higher processing power can be – I mean can help just to – I mean to use like the DNN in real time, like a bit like something similar to what your like, Swiss competitors is doing and that you basically took the decision of being like probably closer to what Starkey or Demant are doing.

Like, is it the right way to look at it, because the difference in processing power seems to be pretty big between the chip like in your Swiss competitors versus yours. So, that’s why I am asking.

We would absolutely not see what we are doing inferior to any product on the market. It is really there to compete with the best devices, including what Sonova has launched.

So, we don’t see this being any inferior kind of helping in the hearing and noise environment. We are probably taking some different decisions and what we believe is important and what we really believe is beneficial for the end users.

But this is really real AI, real machine learning. It’s trained on more than 13 million spoken sentences, and it’s really performing in a great way.

But it’s also performing in an efficient way. And we actually think that’s something really good and because that is what allows it to be – I mean using less power and also allowing the form factor to be compelling.

So, we really believe we have done something great here and are proud to bring this to the market.

Perfect. Thanks.

If I may maybe squeeze in a last one very quickly on category, I know also like your competitor is trying to push for the creation of a new category, which would be more like AI-driven. You took the approach like them having a dual chipset.

I mean first of all, do you believe in the creation of that? And would you maybe push for the specification of this category to be like dual chipset, including one dedicated to AI?

I mean what’s your view on that?

No, I don’t have any strong view I can share here today. But I think it’s an interesting, of course, observation.

It is a new shift in the market. We are really going to a new capability here to process sound in new ways.

So, we firmly support that. Exactly how this will play out in our pricing approach and so, we probably need to let that give it some time.

Perfect. Thank you very much.

Yes. Good morning guys.

Firstly, just on G&A expenses, which were quite a lot higher in the fourth quarter than I think most would have expected. Just wondering if there anything funny going on in there and how we should be thinking about that line through this year?

And then just on hearing, I just wondered if you have undertaken any destocking in hearing in the fourth quarter ahead of the new launch? Thanks.

David, thank you. On the G&A, in our minds, actually, if you look at the year-on-year comparison and you take out the one-offs that we had in G&A in ‘23, right, we have seen a decline in G&A.

Then what you can also see is that there is for us a tendency to have a Q4 G&A that is somewhat higher than the other quarters. So, in that sense, it doesn’t stick out.

And of course, you should then not use the Q4 as this is the basis for multiplying by four over the quarters. You should anticipate also that the pattern we have seen previously is going to repeat itself.

And as such, we do not see it as a dramatic change compared to what we have seen historically. But of course, I would agree with you that it’s higher than it was in quarter three.

So, I think well spotted. And – but for us, it’s not extraordinary.

I can continue with comments on the destocking. No, I would not say so.

The introduction of Vivia here, as I laid out a bit earlier, will be as fast as we can, but still a gradual rollout. I mean we are ramping up volumes.

And as such, we still need Nexia to be in the market in significant volumes for a period of time. And they will coexist, and it will be a gradual shift between the two.

So, nothing dramatic in any way to take notice of here.

And maybe just going back on the G&A comment, I mean any sort of particular guidance whether it should be up, down, sideways for G&A costs in ‘25?

I think no, we are not guiding on individual line items here. I think we overall have said that in the strategy context going to this 16% to 17%, we expect over time to be more efficient than we are today, but probably have a shift within the G&A from admin into IT to support the growth platforms that we are having and the security platforms we are having.

So, that’s how you should read into that. We are not guiding specifically for G&A for the year.

Thank you.

Excellent opening remarks. I have two questions, one on Vivia.

Peter, now you are talking a lot about this algorithm you have developed. Is it possible that you can share some information about how active is it?

So, for example, if you take throughout the day, will it be turned on the entire day or only when a noisy situation is detected, or how does it actually work? It is impressive to have this in such a small hearing aid, I would say.

So, some color on how it’s actually working would be nice. And then secondly, in relation to the OTC category, jabraenhanced.com, core hearing, and how we want to break things down, what’s your view on the OTC category these days?

How big a share of the U.S. market or the market in general has the OTC category taken?

And what’s your position right now on jabraenhanced.com? Will you continue to invest in expanding that channel at the same level, or how should we see it going into 2025?

And final question is, Soren, when you discussed IT, ERP, cybersecurity investments, is that something we will see in the P&L, or is it more of a CapEx and activation on balance sheet thing?

Okay. Thanks a lot, Carsten.

Let me start here. I mean as for Vivia, the way it works with the AI chip and turning that on is that it’s a bit like a hearing mode.

So, you actually turn it on yourself. And we believe that it’s good to allow the user to have the full control of how they leverage the hearing aid, a similar way as we are doing it today.

But it is very power efficient. So, you can have it on for longer periods.

So, it’s not a real limitation that way. It’s more to give the user control of how they like the hearing experience to be.

So, that’s how it works. And we very much believe in that approach.

And then for OTC, we – I think the honest answer is that we don’t fully know the OTC market exactly the size of it, given that all the players into it. If we look on our own business, I mean as we are communicating, I mean it’s growing nicely.

It’s growing – I mean, it’s growing double digit, and it’s trending towards a breakeven here. So, I think we saw a very healthy progress, both in growth and bottom line improvement throughout ‘24.

And these trends, we do believe continue. So, it becomes, of course less of a drag on profitability, and that’s in line with how we plan for it.

And then when it comes to the IT, as we also said as a fundamentals on the guidance, we are also investing in IT and also fundamentally in operations and supply chain. And that is a balance on actually having costs in your P&L as we mature these items.

And of course, also when it comes to the projects, it goes into the CapEx side of it on the longer term ERP projects. And then they will come on stream as we complete the modules.

So, I think that’s the way you should read into it that it has both legs, right. And so one of them is sort of here in the start-up and initiation.

And then over time, once we complete the assets, of course we will start to depreciate. And that is the way we also rolled it in, and again the long-term outlook for ‘28.

So, there is no change there.

Thank you.

Yes. Good morning.

Thanks for taking my question. The first one is on hearing and whereby in particular on the hearing aid market.

So, you guide for 4% to 6% unit growth on a positive side with clearly potentially France. But if you look on ‘24, the overall market seems to be to show a more muted development around the globe than the years before.

So, can you elaborate a little bit about your view on the market? So, what makes you more confident on ‘25 apart from, let’s say, the French opportunity?

Second question is on enterprise profitability. So, in ‘24, you showed a quite strong progress in a tough environment.

Now, eventually, you expect the recovery for a turnaround for ‘25. What’s your view?

How will the recovery impact profitability? Is there an element like you sell in the beginning of the recovery more basic devices compared to premium so that the mix deteriorates or improves?

It would be great to have your thoughts or your expectations for this. Thank you.

Thank you so much for your question. If I start with the market, we do acknowledge what you lay out in the question that ‘24 was a bit weaker than the normal structural market growth.

On the other hand, ‘23 was a bit on the strong side. I mean we are assuming, see it as our planning assumptions that the market will find itself back to more structural growth rate.

It is how we plan. There is of course always a level of uncertainty in any forward-looking projections.

But in terms of our guidance range, we – it will take quite a lot for the market development to change our belief here in the growth of our business because a lot of this is also driven, of course by the launch of a new platform where we believe we have been able to grow faster than the market. So, that’s probably what I can say.

Then as we have known in the last periods, the U.S. has been doing a bit stronger and Europe a little bit less so, in particular parts of Europe.

And we do assume over time that this will even out a bit to support the story as laid out.

Yes. And then when it comes to the profitability of enterprise, we are of course, very satisfied with the development we have shown in the improved profitability in enterprise from ‘23 into ‘24, because it’s probably even more impressive as it’s been in a decline with this negative 3% in organic growth.

And despite that, we have actually improved our margins quite a lot. And I mean that has been a very deliberate strategy from our side on the synergies and actually also being quite disciplined on pricing.

If you go back to our Capital Market Day, we back then also said that this was the year where especially we expected the hearing and enterprise to improve gross margins in ‘24. I think we have delivered on that.

And then essentially from there on, it would be more or less of an improvement, of course again depending on if we end up in the high or the low end of the guidance, which I earlier also said on the spread on the margins points. Then as we also said in the beginning here, finally if the year concludes with the tariffs that we have assumed here in China, it will of course have an impact, as we said, on enterprise, albeit less than what we have seen in gaming.

And as we said, hearing will not be impacted. And of course, that needs to be factored in, but let’s see where it is.

We have set a midpoint that leads to the 0.5 basis points on our margin, right. And as it’s a tariff, it’s of course, driven up to the gross profit line where it will impact.

So, I think that’s as much guidance we can give you with what we know today and what we have actually included in the midpoint for us. Hopefully, that clarifies your question.

Yes, to a certain extent, yes. But do you see some impact on the product mix in the recovery that say recovery starts first with more sophisticated product lines or basic or is it equally distributed?

Let me share a bit more granularity on that. I think that there are probably two things taking place at the same time.

One is the shift from wire to wireless, which we talked a bit around our Capital Market Day also. And that’s a very positive shift for us because we have a stronger portfolio and most of our portfolio in wireless.

So, if you take the U.S. market in particular, that has been a bit overweight on wired.

And that is also supporting ASP growth because wireless devices are a bit – I mean higher priced. Then of course you have a lot of different price bands of more entry-level headsets to more advanced headsets.

Here, I think we – during a couple of years ago when the market was declining quite a lot, we actually did see more the entry levels perform stronger and the premium a little bit less. That has evened out quite a bit in the last few years.

So, I think it’s a fairly – I mean similar behavior now between the different price bands and growth if you take the wireless category as an example. And our best assumption is that we probably will see that continue into the year basically.

Okay. That’s very helpful.

Thank you very much.

Thank you. I will turn to – directly to one of my favorite subjects when it comes to GN and that’s your capitalization.

So, you made massive capitalizations in quarter four, had a net positive effect of DKK335 million. So, how should we think about that?

Firstly, was that part of your guidance for 2024 that you would have such a positive boost from R&D capitalizations? And secondly, would that mean that we should expect higher amortizations for 2025?

And then my second question on net working capital, would you expect further reductions in net working capital? Thank you.

Thank you for the questions, Niels. And it is correct on the capitalization on R&D that they were higher in fourth quarter.

You probably also remember that when we reported out on the third quarter, we at that point in time said that the capitalization rate was lower than what we expected, but we would likely land the full year capitalization rate around 53%. And this is actually where we are right now.

So, yes, we had anticipated this uplift in the guidance and the way we also rolled it into the accounts. One thing though you should be aware of is also that there is IAS 23 where we have also had an expense under financial items where we have capitalized the ongoing R&D projects.

And then it has a magnitude of these DKK50 million approximately. So, of course that number, as this is a number that hits in the fourth quarter sort of inflates your quarterly performance on these capitalizations.

So, I really do think that what we said in quarter thee still stands firm on the 53% on the capitalization rates for R&D. And as such, we are in line with the overall communication we did for ‘24.

Overall, we do not believe that it has a large impact for the amortization coming into next year, this DKK50 million. It’s over 5 years that they get depreciated.

So, I mean evidently it’s DKK10 million with that level. So, we do not believe that that’s going to change, and it is included in the way we guide today, Niels.

Then when it comes to the net working capital, I think we are at a level where we believe we can stay with the composition of business we have, with the inventory levels we have. We are of the opinion though that inventories should always be a high important focus area of ours.

I think most people would also acknowledge that the uncertainty on where the inventory sits on sea and air levels today, of course it’s somewhat difficult to predict. We are fairly quite committed to that the sea transportation is our preferred route.

It yields the best cost position for us, and it yields the best CO2 emission profile for GN. But exactly how that then pans out with all the turmoil that’s going on in the world, let’s see.

But I think we have a clear strategy on where we transport our goods and how it influences our net working capital.

Can you just briefly remind us of what kind of CapEx to sales ratio should we expect for ‘25?

No, we are not guiding on that, Niels. So, so far, that’s not a number that we give out.

We have – what we have said, just to give you some estimates, right, and also back to the capital markets presentations, we had the cash conversion cycle of 50% to 70%, excluding financial items. And of course, we say excluding the financial items because ‘24 was a year where we had more bond financing, and now we come into a more term loan financing, and that’s back to, of course the financial items that we have that will be higher as we have also communicated throughout ‘24.

Actually, that would happen in ‘25. And as such, of course that takes down the cash conversion a little bit.

So, that would be my response to that.

Thank you.

Thank you for taking my questions. Two quick ones, please.

So, first question on the Vivia. When did you start developing the AI features, just trying to get a sense of the timeline and speed?

And also, should we expect or do you anticipate the need for any step-up in marketing spend in hearing for the year, given how we have seen a quite significant increase in marketing efforts in conjunction with launches from some peers recently? Thank you.

Thank you. Now, when it comes to the underlying shift to go to machine learning as a way to process sound, that’s been a very long-term investment, perhaps even up to 10 years.

And it’s also a fairly well-anticipated shift. I think what’s happening now it’s coming together with the right level of chipset technology and the further kind of advancements on how we do this type of algorithm to make it possible.

But in terms of as a concept of machine learning, it’s been relatively well known in the industry as in the research communities. And it is something we really invested in because we believe in it.

And it’s really a great capability to leverage to process sounds. And it’s also something which you should expect that we will leverage into enterprise headset, most likely into gaming headsets and bars and other type of products over time because it really helps you to control what sound you like to pick up, what sound you like to amplify, what sounds you like to suppress or so.

So, it is a very powerful way of working with sound processing. So, we have a great group of people really mastering this way of working and these technologies, and we do believe it will benefit us going forward from hearing, but also broader.

In terms of the cost for Vivia, I mean we have guided, of course here as much as we can for the year and the margins for the group and so on. But I think it’s fair to assume that if we look on the hearing margin profiles during the launch period, we tend to take a bit more cost because you of course like to build the momentum for your new portfolio and so on.

So, in terms of the business, you probably should expect the hearing business, both volume-wise, but also margin-wise to start a bit slower in the year and then build up both volume and margins throughout the year. And this is very much how we normally do it.

Thank you for taking my questions.

Thank you.

Hi. Thanks for taking my question.

First on the hearing business, could you comment on the market dynamics in North America? How has the sequential growth been there in hearing?

And second, on tariffs, so you are assuming impact only in gaming and enterprise, but you have manufacturing sites for hearing in China as well. So, does it only cater to non-North American region, and that is why you don’t see an impact from that?

Thank you.

Thank you so much. If I start with the North American business, if we look at Q4, as I am sure several of you have seen, growth slowed down quite a lot compared to Q3.

I think it was primarily driven about what happened a year ago when in Q4 ‘23 we launched Nexia and had a very significant growth in several channels in the U.S. So, it was really the comparison base that created this effect.

And a little bit the flip side of that is that the rest of the world grew very strongly for us in Q4 and Europe also. So, if we look over the full year, the growth was very broad-based and actually on a similar level across the three regions and also on similar levels across channel type.

So, it’s nothing we are worried about anything. We of course take notice, but it’s more the effects on how we launch the products.

And now with Vivia coming and being launched first in the U.S., we do think we will be able to see a pickup of the growth momentum in the U.S. as well with the help of the new hearing aid.

And then if I comment on the tariffs, it is correct that we do manufacture hearing aids in China, but we also have significant hearing aids manufacturing in Malaysia. And then also we do the core chipsets in Denmark.

So, we have all the flexibility to supply the U.S. market outside of China, if we will decide to do so.

But also the current tariff environment, which has been in place under the previous Trump administration and the way we understand it now would most likely be exempt also as a medical device. So, that is why we are guiding that we do not – I mean we do not assess to have any impact for the hearing business.

And I believe also some of our competitors have guided in a similar way. So, that probably is the explanation.

Thank you.

Thank you.

Thank you so much, operator, and thank you everybody on the call.