MIPS AB (publ)

Thank you, operator and good morning, everyone. My name is Max Strandwitz.

I am the CEO of Mips. With me today, I also have our CFO, Karin Rosenthal, and we will take you through the presentation of the Q1 2025 interim report.

And if we start with the key highlights of the quarter. So first of all performance, we did see a continuation of the last quarter performance and growth patterns with strong performance in the quarter of 42% of course, organic growth.

We saw good development in all the three categories we operate in and good growth in most geographies. We do see strong sales to European customers fueled by improving consumer markets.

Good growth also in the US, despite a much more careful consumer spending versus before. Our assessment is that the near-term sales development to our customers will be more uncertain, due to the lack of full understanding of the effects and implication of the implications of – or implementation of tariffs.

We did see a strong improvement in the quarter with 78% improvement, mainly driven by the strong net sales improvement. This was partly offset by legal costs relating to a customer's legal IP dispute.

Mips are not part of the process but has decided to step in, since Mips has interest in the IP-related areas. And we remain confident in our long-term strategy and our financial targets.

If we look at current situation and – or expected impact from tariffs, I think it's very important to spend some time in that area to explain what we mean. The rapid implementation of tariffs have brought a lot of uncertainty to our industry and that is valid for all the three categories that we operate in and it's valid for the US market.

Our customers' main uncertainty is of course, what is actually the right cost of the product. Most customers today, they don't know how much their product will cost in one month from now, when it lands somewhere in the port in the US.

And of course that creates a lot of uncertainty. If you don't know the cost of your product, it's also very difficult to assume or assess what is the right level of pricing to protect your margin and cost and what you need to take in terms of covering that part.

And then of course, the third one, if you price, how do you actually know that it's the right level of pricing? How will that affect your competitive position?

And of course in the long run also the consumer demand. I think that's a question that everyone in the industry sits with at the moment.

And we believe that that will create a lot of uncertainty. What happened last time this happened.

So in 2019, Q3, we actually saw similar type of impact, when the bike industry all of a sudden were hit by tariffs, which they have previously been exempted from. Then we saw a little bit of a standstill to the US market for one to two months.

And then after that people took pricing and everything normalized. And we do expect a similar type of situation also this time.

And just also to clarify that in 2024, 53% of Mips net sales is to US-based brands. This is of course also visible in our annual report.

Those brands are then distributing the products all over the world. And of course, we have other brands, especially in Europe that is then exporting to Europe.

But if we make a net-net calculation on our estimate on how much that actually lands in the US market when it comes to volume, it is a bit more than 50%. And we do expect short-term demand swings from the implementation of tariffs.

So hopefully that clarifies a bit in that area. If we then go into the first category and sports, in sports the good progress continues.

We saw strong performance in sport with 40% net sales growth. Inventory is back at healthy levels.

Market conditions in Europe are improving. US consumer market a little bit more uncertain.

And, of course, this also fueled a bit what happens in the implementation of tariffs. We have a very strong position on the market and we are confident on the long-term outlook of the sports category also in the US market.

If we then look at Moto, we saw strong growth there and really good to see Moto getting back on track. Good performance in the quarter with 32% net sales growth.

Situation is much more normalized, but it is of course a very tough market out there. We have also seen a very successful rollout of Integra TX product, which is our fabric solution.

And to support that rollout we also have a very strong retail activation program, which is also working very well. Also here no change to our long-term outlook, good opportunity to continue to grow in the category.

If we look at safety, we continue to see good development. It was actually the largest quarter so far despite that the Q1 is normally not the biggest quarter.

That was actually the biggest quarter in safety to date in the Mips history. 60% growth in the quarter.

We did roll out or continue to roll out new helmet models. And, of course, also last year we had a strong rollout program.

And, of course, we start to see that those models are starting to generate a lot of demand. And we are also very positive on the outlook of this category.

But of course also here short-term demand could be impacted by the implementation of tariffs. If we then look at the development and summary of the development in our different categories.

In sports, good performance with 40% net sales growth a bit better if you adjust for ForEx effect. And we see a continued strong performance.

Also good to see that we were growing strongly in bike, but also in snow we showed an improvement of 20% net sales growth in the quarter, which is of course great to see despite the fact that it has been quite a challenging snow season. Motorcycle also continued to develop well with 32% growth in the quarter.

And safety, the largest quarter so far. And here, of course, we continue to see a lot of traction.

With that, I hand over to Karin.

Yes. Good morning, everyone.

I'm Karin Rosenthal, CFO of Mips and I will take you through the financial part of the presentation. We saw strong development in the first quarter with an increase in net sales of 40% and adjusting for FX due to a strong SEK versus USD, net sales increased with 42% organically.

Gross profit increased with 46% and a gross margin of 72.1% versus 69.4% last year. And the increase is mainly due to the increase in net sales.

In OpEx, we were negatively impacted by legal costs of SEK9 million based on what Max presented earlier. We also continued to invest in our strategic priorities R&D and marketing in the quarter.

EBIT was up 78% to SEK24 million versus SEK14 million last year and EBIT margin improved by 4.5 percentage points to 20.9% versus 16.5% last year. And we saw a strong operating cash flow in the quarter with SEK 36 million versus minus SEK 10 million last year.

And if we look at the financial KPIs, 42% organic growth, 21% EBIT margin and SEK 36 million in operating cash flow. If we then turn to next page and look at the balance sheet and cash flow.

We have a strong cash position with cash and cash equivalents of SEK 408 million. And just to remind you that we don't hold any loans.

And the Board proposes a dividend of SEK 6.5 per share versus SEK 6 per share last year and that corresponds to 122% of net earnings. And operating cash flow in the quarter amounted to SEK 36 million and we have an equity ratio of 87%.

Over to you Max.

Yes. Thank you, Karin.

If we then summarize the first quarter good start of the year with 42% organic growth. Good performance in all our three categories, strong increase in market share and penetration in the market.

Inventory situation is fully normalized. Our current assessment is that near-term sales development to our customers will be a bit more uncertain due to the lack of understanding of the effects and implications of the implementation of tariffs.

And we remain positive on the long-term outlook and the delivery of our financial targets. And with that we open up for questions.

Good morning, Max and Karin. A couple of questions from me.

If we could please start with the legal dispute affecting one of your customers. Are you able to share any more information regarding this?

And particularly, as it relates to yourself, is it fair to assume that we will see additional legal costs throughout the remainder of the year? Maybe a time line on the legal aspects of the dispute would be good as well.

Yes, start there please.

Yes. Of course this is under confidentiality.

So there is some things we can share and some things we can't share. Of course the part relating to us, we try to be as transparent as possible.

Of course we had SEK 9 million of cost in the quarter. That's very much preparatory cost, which you normally have when it comes to these things.

And of course we assume that we will have similar type of cost also going forward, at least in the beginning, as you prepare for these type of costs or cases. The more you spend, the better you prepared you are.

For us this is a very important area. So of course we take this always very serious.

I think it's also very important to understand that Mips' patents is not part of this. Mips' IP is not part of this.

This is about someone else rights and what they could claim on the market. As we are extremely adamant and focused on our own brand, our brand position, our IP and our technology of course, we also want to make sure that we have the right rights on the market but also that someone else can't claim this.

And when we announced our targets in 2022, a lot of people questioned, why we don't have an ambition higher than 50%. And we said then that we assume that we will have legal costs like this going forward.

That's also why we don't adjust for this type of cost but we have them under the normal operating cost. And it's part of our business model.

It looks a little bit more dramatic of course than it is because Q1 is the smallest quarter of the year. So of course proportionately, it becomes a bigger part of the total result.

But as we go forward and of course, long-term costs like these are assumed to be within the budget and of course not impacting our long-term ability to hit our financial target. And for us this is more of a cost issue rather than something else.

And of course, when it comes to these type of things, we always want to do the right thing. We want to make sure that we have the best position on the market and that's why we take a decision to become active in cases like this.

That's very good color. Thanks.

Maybe just a follow-up. I guess I'm trying to wrap my head around if it's not Mips patents that are at risk here like what's the I guess what are you protecting yourself against?

Like what's the worst outcome out of this let's say? And is the plaintiff is it a consumer-related lawsuit because it doesn't really sound like it's any patent infringement related?

So yes.

No I think when it comes to what Mips is protecting is of course if someone else comes in and of course especially since they don't have any products on the market they could claim that they have the rights in certain areas, which Mips also have the rights, of course, and patents are normally very specific. We want to make sure that our freedom to operate is as big as possible.

And of course, we don't want that other IP could be very close to our product or questionable for our products. And that's why we want to be very specific on the actions we take.

IP is of course a very complicated matter because a lot of things or discussions like this is normally about products infringing, because the patent can of course never infringe because without a product there is nothing to infringe about. So it's more of making sure that other IP is not close or in areas where we believe that we have very strong rights.

Got it. Got it.

So it is about patent infringement and not the safety hazard of that.

No exactly.

Okay. Perfect.

That makes perfect sense. Thank you.

And then if we follow on your comments regarding tariffs. I appreciate the commentary around what you expect for the bike market and so on.

But could you maybe touch a bit more on the Safety segment? I mean we had great hopes that 2025 would be the year where volume would ramp up quite materially in this segment.

And I do know that the U.S. is also important or maybe just as important as it is for the rest of the group for construction helmets.

So what's the -- I mean are you still sticking with your guidance of a doubling every six to 12 months? Or what do you think that we could even see with construction helmets delays?

No. I think when it comes to -- I think first of all to outline what we are saying, we don't expect it yet to have a material effect of the full year more of a rephasing of sales.

So our full-term guidance what we said on Safety remains. But of course, it's more of short-term issues that the customer don't know what pricing they should take what actions they should take and so on.

And that's impacting all our three categories. So yet we don't consider it to be lost sales more rephasing of sales and that everyone is trying to delay their decisions as long as possible.

There is very erratic behavior at the moment when it comes to the implementation of tariffs. No one knows what to expect and that's what everyone appreciate at the moment is to have a little bit more time to take more informed decisions.

And that's why we talk about an uncertainty and not a long-term impact.

All right. And then if we think about the bike helmets category, I mean, could we assume that you're somewhat protected might not be the right word but just from seasonality variations the fact that you produce or your customers produce bike helmets in the second half of the year.

Now it's more about sell-through to the retailers and end users. As long as we don't end up in a situation like post-pandemic where inventories were elevated post this spring and summer season like I don't know I'm just trying to think about how we should -- I guess the second half of the year could be potentially still okay-ish despite all the uncertainties?

Yes. I think first of all, it's important that of course we see an impact in US.

We don't see an impact in Europe. Europe is actually tracking very well and you see that also in the first quarter and we believe that also will continue of course.

When it comes to where the impact will be, you're right that bicycle helmet has been produced and a lot of the volume has been produced. What will be impacted is repeat orders of course if no one produce that should normally land on the US market late July, beginning of August, especially when you have a lot of back-to-school campaigns and so on.

So I think, that is the volume that is really at risk. We believe that the production for next year which will happen in Q3 and Q4 will not have a significant impact of course all depending on what the levels of tariff is and so on.

But there we expect it to be much more normalized. The other part that is a little bit at risk depending on how long this will take is of course the snow category.

The snow category normally produces a lot of helmets during Q2. Those should then land in the US market at the retailers mid-September, beginning of October.

So that of course is the window that you need to hit. And there of course they need to take a decision at some point, when is the right time to produce to still make that window, because no one will accept that you have winter helmet coming after the season.

So I think that's what everyone is preparing for. We have of course very active dialogues with all our brands.

Everyone is in the same position. It's more about uncertainty rather than consumer demand.

And as you've also seen I mean, we have great traction and momentum on the market, but this is something else. And of course, we need to treat it as an exceptional event and that's why we communicate the way we do.

I think there is a lot of people that will tell you exactly what will happen at the moment. For me, they're only guessing because there is very erratic behavior.

And that's why also we want to really explain this as we see it it's more around uncertainty.

Makes sense. And then just lastly, if I may.

I mean, I fully understand the fact that you're not directly so to say impacted by the trade tariffs, but that your customers will have to increase prices to offset that. Could this be a situation where you potentially can end up being a bit opportunistic and also increase your prices because it's been quite stable since inception really on your…

Yes. I mean, we have a little bit of a different pricing strategy.

I think long-term, you deserve or you get the price you deserve on the market. We manage our pricing mainly through innovation, bringing better product on the market.

That I think is a much more attractive way for me using tariffs to be opportunistic, I don't think that's our right approach and especially since normally tariffs can go both ways. And of course, you end up in a quite a complicated discussion.

So I think for us, we stick to our current strategy which is of course to innovate ourselves to better products and better pricing and so on. And that has worked really, really well so far and that's what we want to stick to.

Sounds fair. All right.

I'll get back in queue. Thank you.

Thank you, very much. Good morning.

So a couple of questions from me. First, starting -- coming back to the Q1 numbers and I just want to make sure here.

But I guess there haven't been any patterns of pre-buys in your numbers given the pace of implementations and the long delivery cycles, right? Nothing of that in Q1 right?

No. I think now we hear from a lot of customers that they wish they had done pre-buys and so on.

But no, we cannot distill in any direction. People ask us if there is pre-buys not to a bigger extent.

People also asked if we saw a lot of delays in the end of Q1 due to the uncertainty of tariffs and it's the same way. So no, we can't distill any impacts or either direction.

Very clear. And then secondly, I wanted to come back a little bit on the underlying market.

I mean, I appreciate the color and let's say the increased uncertainty in the US. But recalling from Q4 you were actually talking about underlying market growth on bike in Q4 on the sellout side.

And I just wanted to hear, because I guess the statement here for Q1 is a little bit more vague at least relating to the US. So any more color just Q-on-Q development underlying market would be appreciated as well.

The market development number, and market share numbers for Q1 is available from next week onwards. So there is always a bit of lead time.

But of course, if we talk about overall assessment from the industry is that the market was sort of flattish in the US market. Of course, we had a lot better performance than that since we grew 35% with our sales to the US market.

But best assessment is somewhere around flattish. And then if you look at the European market of course that we actually saw quite good development and you have probably seen also that on reports announcement from both Halfords BIKE.DE and others that they are quite optimistic of the European market.

And we see that development. We see that the European market is improving, but it's also worth to mention that, it's from lower levels because the European market has been a lot more depressed.

Therefore, it's also a lot any upbeat in terms of consumer sentiment will of course have a positive effect. But Europe seems to be tracking quite well.

Very well. Then I just wanted to come back a little bit also here on Q1.

I mean looking at the reported numbers as you disclosed the sales of goods, I guess, the pure volumes and the service or let's say yes implementation invoicing. And I'm noticing that, it's taking both on a year-on-year basis a step-down and also sequentially here from Q4 down to SEK three million on the service side versus let's say seven, six Q3 to Q4.

Yeah, any more color on that let's say the implementation or interest has been a little bit lower from the brands here or anything specific behind that?

No. If you actually look at the total number of running projects and so on we still are on a historic high.

What we have been doing the last two quarters is that we see a big increase of our fabric solution, which is also in line with our strategy. Those solution doesn't require the same type of tooling, especially not injection molded tools and so on which is normally quite expensive.

So in terms of project momentum, no change is more relating to a mix and phasing of projects as such. So no change in momentum, no change in customer interest.

But good to see, of course that, the fabric solutions is coming out especially the Air Node solution and also our Integra TX, which is of course a higher-priced solution where we deliver more of the product and we also see a great reception on the market of those products.

Very well. And just finally, from my side, I wanted to hear I mean, we're reading some articles here and there and coming back to the price situation, I mean, I appreciate the color that you gave on your pricing strategy.

But have you seen what your customers have been doing? I mean, we see some bike manufacturers have been talking about price hikes of around 50% to offset this effect.

I don't know, if that's actually been materializing or not. But have you seen any material price adjustments upwards on the helmet side in the US already?

Or is it?

Yeah. The first movers we have started to see them acting.

We have not seen anything close to 50%. One big manufacturer they increased price with 10%.

Another one with 8%. So far 8% to 10% is what we have seen.

Bicycles could be a little bit more, because of course, they are more impacted by tariffs at the moment because first of all you have the general tariffs but then you also have material -- or material tariffs that impact the product. So there some speak about more like 15% increase.

But from what we have seen first movers is somewhere around 8% to 10%. It all of course depends on what will happen on the tariffs.

I think the general assumption is that no one believes that the levels of tariffs that we see at the moment is the one that will stay over time. And therefore, also brands are a little bit more careful of initiating really aggressive pricing with of course the potential impact of that.

And also, the goods that has landed so far has not been impacted by tariffs. It's more the goods that will be shipped coming months and of course the argumentation around that.

But I think also the US market starts to understand. And, of course, also like if you look at Walmart or Target, the US government now understands also how reliant they are on Chinese and Vietnamese goods.

And, of course, that you will have empty shelves if this continues. So over time, I think everyone expects it to be less dramatic than it is now, but it's just anyone's guess.

Okay. Very well.

Thank you very much guys. I will get back in line.

Hi. Good morning, everyone, and thank you Max and Karin for taking my questions.

Just jumping quickly back to the tariff situation. I think you mentioned that you expect to maybe see a similar situation as you saw in 2019.

And just looking back at those numbers I think we saw a negative organic growth in Q3 around 6%. And then in Q4, it jumped back to 30%.

Obviously, at the moment I think the tariff situation is more severe than last time. But do you think that the -- or do you experience that the OEMs or the manufacturers has more experience this time regarding the situation?

Or is it a completely new situation for them?

Yeah. They are much more prepared.

I think no one was prepared for the levels of tariffs that they saw at the moment. We started the discussion with our customers already in October last year to understand what their position was, how they are going to act and so on, because of course it's important to understand.

I think everyone is taking a bit by surprise, by this ping-pong negotiation that we saw between US and China of course, and how it escalated. But you're right, they are much more prepared.

They saw this coming. And, of course, every one of them have a pricing strategy linked to that.

I think everyone is just waiting for the dust to settle, to really understand what's in front of them and of course what the future looks like in terms of the right level of pricing. So I think for everyone at the moment it's more like wait-and-see.

Yeah. Thank you.

That's clear. And regarding these US brands then, do you think there is opportunity or maybe a potential scenario where they will focus more near-term on the European market which will maybe drive your penetration faster maybe?

No. I think in the end, we of course, already have a great traction in Europe.

Last quarter we saw 100%. This quarter we saw 51% growth.

So, of course, we still see a good momentum and so on. I think it's very important to distinguish what happens when it comes to sourcing, which is where the focus is on the brands and what happens on the consumer market because at the moment, everyone is still as active, when it comes to the consumer market.

1.5 week ago, we were at Sea Otter, which is a consumer event, where we participated. We saw a very upbeat consumer.

Of course, that's the sweet spot for Mips because there is a lot of mountain bikers, there is a lot of gravel riders and so on. And they were very optimistic on the market.

So I think this is not yet a consumer discussion. It's more of a sourcing discussion.

So I don't think anyone will change their short-term strategy on that and not reallocate resources because everyone is still trying to win on the market, and I don't expect one or two months of uncertainty will change that. And then it's more like relating to where to produce.

There is a lot of pressure to produce in Vietnam at the moment. There is factories planned to open up in other areas.

But of course, relocating production takes normally a bit of time. We will of course, follow the customer wherever they go.

We can move our tooling in a couple of weeks. So, whatever the -- or our brands decide to produce, we will follow them.

But it's more of a sourcing discussion rather than a strategy discussion at least for now.

Yes, great. That's clear.

And can you just remind us on the construction or safety helmet side? Is the majority of production in China?

Or how is it distributed?

No, I mean it's a bit of a mix. The more advanced helmets that requires a little bit more of manual work and adjustments and so on are normally manufactured in China.

So, a lot of the Type 2 helmets and so on. When it comes to simpler helmet models, since transport cost is a big part of the total cost, they are normally produced in the country which they are sold, so Europe for Europe and U.S.

for U.S. But when it comes to a little bit more sophisticated product, it's still heavily reliant on Asia.

We expect that to change over time, but at least for now.

Great. And the last question from my side here just going back to this lawsuit situation.

Do you think that this type of case will become more common in the future going forward?

I mean we have seen last time but then, of course, Mips was a party and then we were the ones that were very active on the market. That was in 2018.

This time it was started by someone else. It doesn't mean that we didn't decide to be active of course.

Lawsuits, like you see SEK9 million in the quarter, can be quite expensive. So, there is not a lot of companies that actually can run a case like this.

So, no, I don't expect it to be -- happen a lot, but it could happen and that's why we also assumed it in our long-term budget that sometimes if someone gets rights that we don't think they should have or they are overlapping in the areas where we have rights, then, of course, we will be active. It's part of our business model.

We have a couple of priorities and that is of course to make sure that we have the highest awareness when it comes to our brand. We have the best technology out in the market really important for us.

And of course where we can also to have good protection around our product. That will always remain a key part of our strategy and a key priority for us.

Great. That’s very clear Max.

Thank you very much. That was all my questions for now.

Thanks so much.

Thank you, Emanuel.

Good morning guys. One follow-up here.

If you could talk a bit about the start to Q1 in terms of growth given the tariff situation.

Do you mean Q2 or Q1 because…

Sorry Q2.

Okay Q2. So, like I said, we have seen the uncertainty directly from the start of the implementation of tariffs.

So we said that we expect it at least to remain for one or two months. So, yes, we have seen uncertainty from U.S.-based brands.

Yes, thanks. And then on sort of the snow sales in Q2 and the possibility to recoup that sales in Q3 and still get it ahead of the season, what's sort of the outlook there in terms of timing?

No, I think I mean if we now face 1 two months delay, nothing happened with the tariffs. Still when we hit June and July, there will be a lot of factories running with high capacity to make sure that they catch up.

No one can wait longer than that. And we have not heard that any brand wants to wait longer than that because like I said also in the beginning consumer demand is there.

Great demand for Mips product continue to increase market share. Our brands want to have our product but what they ask for at the moment is a little bit more time to take the right decision.

So, it's more of a timing issue rather than a long-term issue as we see it now. So, I believe when we hit June and July, the factories needs to be really running a lot of production of snow helmets to be able to hit the market.

Got it. And can you talk a bit about the inventory situation in the snow segment, now post the season?

Is it…?

It has actually not been a fantastic season when it comes to winter sports and so on. Last quarter or Q1, we grew about 20%, which we were very happy about.

But if you talk to the industry as in general there were a little bit more careful consumer spending especially when it comes to clothes and other accessories and so on. But the good thing at least from helmet point of view is that no one went into the season with a lot of stock.

So if we look at preseason orders, still very positive and we see good momentum also there. So nothing in terms of what we see at the moment that will hurt us in the season, so good interest still in snow.

Thanks. And then maybe just a last question on the partnership with Pyramex in safety.

If you could give us some color on the size of Pyramex?

Yeah. And Pyramex is mainly active in the US, but of course they have sales I think in 63 different countries, so also good presence around the world.

Medium-sized player and the medium-sized player is normally between SEK1 million to SEK10 million in Mips terms and so on. So quite a decent sized player on the market and someone that I think can help us to drive a lot of growth around the world.

Perfect. Thanks.

That’s it for me.

Thank you.

Yeah. We have one question that came from one investor, which is about the legal dispute that will ask us why we don't treat the legal costs as a one-off expense, and also if there could be a legal one-off gain coming out of the disputes.

First of all, like I said also and explained before, we see this part of our business model, protecting our IP, making sure that we have the right protection. For me to put something into adjustment or call it adjustment or adjusted EBIT, EBIT needs to be for really the right reasons.

And if you have things that can come and go then of course it's important to treat them in under your operating results. I think that's cleaner that's a lot less complex and also much more transparent.

So we are treating it under running cost because of course these things can always come and go. And when it comes to one-off gains, I think especially for the US market the way that it works, it's very difficult to get any back -- money back from a lawsuit and we will not count on that.

The second question is also around legal cost is that someone asked if we will incur SEK9 million per quarter or SEK18 million for the year. And, of course, this is something that you really don't know exactly how much cost there will be.

Like I said, proportion of the total result of course will be a lot smaller since quarter normally will be bigger. But the running cost that you saw in Q1, could of course continue for a couple of quarters, because we are still very much in a preparatory phase.

Then, we get the question is, what is the magnitude of price increases that your customers could pass according to the discussion you have with the brands. And like I said before, so far, we have seen 8% to 10% that has been put forward to retail.

It all depends on where the tariffs will land. If they stay at 145%, of course that will not be enough.

But I think the assumption from everyone is that they will be significantly lower. That's why, everyone started more like 8% to 10%.

Sales in Asia and Australia, lower than last year. How do you see demand in this area?

We have had a fantastic development in Asia. We see really good sales in that region.

Now it's the low season in the Asian market. And there of course, you don't have a long shipping time, but we expect that to pick up over time.

It used historically to be only like 3% to 4% of our sales. Last year, I think we landed up somewhere around 13%.

So it has become a much bigger part. And we still see a lot of interest in especially, the Chinese market.

We are a little bit careful on, who we team up with, because of course we are still building a brand. We always do as we do in Mips, we start with the premium brands.

We start to build a lot of awareness. And then, where we see the opportunity then we can start reaching down.

And that strategy has worked well, served us well and I think it will work also well in China. And then, it was a question in Q2 last year, you talked about increasing project hires for project engineers.

And like I said, we are still on a historic high momentum. We still have a lot of recruitment out there for even more engineers, because of course we see a lot of good momentum in this area.

So even though we have recruited, we still don't have enough people to manage the workload that we have at the moment. So, if you are an implementation engineer, you're always welcome to apply.

With that, I think, we have answered all the questions in the call. Thank you everyone, for listening in and speak to you again next quarter.

Stay safe out there. Thank you.