Dynavox Group (Stockholm:DYVOX) Q3 2026 Earnings Call

0:02 Okay, we have had some technical difficulties here this morning, hence you won't see the camera, but hopefully you will hear us and you will see the presentation. And good morning to this earnings call, where we will cover the third quarter of 2026, summarizing our business in July, August and September. My name is Fredrik Ruben, I am the CEO of Dynavox Group.

0:27 Hi, I'm Jakob Honeberg, and I joined Dynabox Group as CFO on September 14th. Most recently, I served as CFO of a public listed life science company, and before that, I held various M&A roles, both in corporate and advisory settings. I'm very pleased to have joined the team and to be part of Dynabox Group's mission, and later in this call, I will walk you through the financial results for the quarter in more detail.

0:55 Great, thank you, Jakob, and warm welcome. It's great to have you on board. And for those of you who have participated on these calls before, you might be familiar with that. We'll start with a quick recap of what Dynamo Group does, and then I will run the main takeaways from the quarter. Jakob will then dive deeper into the financials, and thereafter we will open up a Q&A session. And you can submit questions during the Q&A session in the Q&A function here in Teams. or ask them by raising your hand in teams and unmute yourself and then we will invite you to speak. And we of course always welcome offline questions and by email to ir at dynavoxgroup.com. But we start with a brief overview of Dynavox Group.

1:40 We start with the opportunity. The market that we service is hugely underserved. There are about 50 million people around the world. that have a condition that prevents them from communicating unless they have a solution like ours. And of the some 2 million people diagnosed every year with a communication disability, we estimate some 2% of them are actually being served and the rest remain silent. And the main reason for this is, frankly, lack of awareness about assistive communication as a whole. So why do we exist? Well, we reiterate often our mission and our vision, which I know is very dear not only to our over 1100 employees around the world but also to our ecosystems of partners and investors and our vision is a world where everyone can communicate and we will contribute to this via focusing on our mission which leads to empower people with disabilities to do what they once did or never thought possible and this also summarizes to our main user stories.

2:39 The first one that do what you once did may refer to a person who led a normal life until a diagnosis Such as ALS, which rendered her unable to control the body or communicate like before And the never thought possible can refer to a child diagnosed at an early age with a condition such as autism or cerebral palsy Where, thanks to our solutions, she can do much more than the world around her ever thought possible If we move on a little bit, we also say that we operate this on a global level Next slide, please. But today, almost some three-quarters of our business stems out of the U.S. and Canada, and that's largely because of a recently well-functioning system established about 20 to 30 years ago.

3:28 Our comprehensive solutions are sold in more than 65 markets around the world, which 12 are markets where we sell directly, while the others are served by a network of some 100-plus reseller partners. And our staff It's distributed almost in the same way, meaning that some 60% currently of our staff are based in North America, with our U.S. headquarters in Pittsburgh, in Pennsylvania, and the second largest office is our headquarter here in Stockholm. But we have branch offices in several European countries, as well as Suzhou in China, Adelaide, Australia, and as of today, as I mentioned, we're just north of 1,100 employees in total. If we then take a quick look about our offering and what we sell, we provide a comprehensive communication solution, and that includes the content and language system, such as the world's leading library of communication symbols, and they're called PCF, and then a leading solution of off-the-shelf custom-made synthetic voices for the highest quality with a large diversity in languages, in ages, in ethnicities, and so forth.

4:34 We develop and own a suite of highly sophisticated communication software tailored to the type of user, which of course can vary greatly based on the needs of that individual. We then of course develop and design cutting-edge technology and medically certified durability hardware that includes communication aids controlled via eye tracking or accessories such as the re-adapt mounting solutions. And we have a large team and a service portfolio to help our users through the complexity of obtaining and getting funding for solutions in multiple markets. And last but not least, we're there in many markets, in many time zones and languages to help users, therapists and caregivers through our global teams of support resources.

5:23 and we operate this model globally. It's important to note that each piece of what I just presented is critically important and also a significant differentiator for us making it absolutely unique. And our go-to-market model is predominantly as prescribed aids. That also then means that some 90% of our revenue comes from public or private insurance providers. And it also means that we have solid paying customers and have always been resilient towards changes in, for example, the overall economic climate. But now we will go back at focusing on the main topic of today, namely the earnings report for a third quarter. And I'd like to briefly highlight a few of the key themes from the quarter. So first, our long-term market opportunity remains substantial and unchanged. The demand for assistive communication solutions continue to be strong and we remain confident in the long-term underlying growth potential of these markets.

6:22 and similar to previous quarter the performance this year must be seen in the light of last year's exceptional growth and yet we deliver a revenue growth of 15% on top of last year's numbers on a currency adjusted basis paired with an EBIT growth of 87% resulting in an EBIT margin of over 17%. And while we continue to see Reimbursement-related complexities in parts of the US, we view this as delaying factors and the overall slower or more cumbersome processes rather than a demand issue. If we look at Europe and other markets, we delivered a somewhat scattered growth with clear highlights, particularly strong momentum in Australia and in Germany, as we continue to benefit from investments in local execution and integration efforts.

7:12 And then finally, we are increasingly seeing the benefits of a platform building investments that we have made over the recent years. So investments in systems, processes and organizational capabilities are increasingly translating into efficiency gains. It was translating to operating leverage and then continued significantly strengthen our cash flow as we continue to scale. But that was just the headlines and I'd like to hand over to you, Jacob, to run us deeper into the financials of the quarter.

7:45 Thank you, Fredrik. In the quarter, revenue grew 13% to 684 million. The currency adjusted growth was 15% where organic growth contributed with 13%. Acquisitions with 3% and currency fluctuations had a 2% negative impact on revenue. As Fredrik mentioned earlier, in the U.S., we see increased administrative complexity and longer lead times, primarily related to Medicaid and Medicaid-managed care organizations, which have backstone growth. Despite these headwinds, we delivered 60% FX-adjusted growth in the quarter in U.S. In Europe and other countries, performance was more mixed.

8:30 with Germany and Australia standing out as the strongest contributors to the quarter's 16% FX adjusted growth in Europe and 13% in other countries. Underlying demand remained healthy and we continued to strengthen local execution and leverage our acquired businesses to build a more scalable platform for long-term growth. The long-term trend remains strong. Revenue has grown from just under 1 billion on an LCM basis in 2022 to more than 2.6 billion today, corresponding to an annual growth rate just north of 25% on a currency-adjusted basis. Gross margin remains strong in the quarter at 69%, although slightly below last year due to higher component costs. However, the increased component costs were offset by lower trade costs versus prior year.

9:26 Overall, the quarter demonstrated the resilience of underlying demand, with FX adjusted growth of 50%, despite continued operational and administrative headwinds in certain markets. Continuing with EBIT, currency-adjusted EBIT grew 94% year-over-year to 119 million, driving a 6.8 percentage point expansion in EBIT to 17.4%. Improvement reflects continued revenue growth, a stable gross margin of around 70%, and disciplined cost management, resulting in operating expenses growing organically by 7%.

10:11 Operating expenses increased primarily due to continued investments in sales and marketing and our IT organizations. These investments were partially offset by lower ERP-related costs, which decreased by 9 million year-over-year, as the ERP rollout was completed in most entities, and by a 9 million reduction in restructuring costs. Operating expenses related to acquisitions contributed with a 10 million increase. Cost for research and development after capitalization and amortization decreased by 90 million compared to the same quarter last year, mainly driven by higher costs in prior year related to organizational restructuring. The higher capitalization of R&D expenses in the quarter related to development of new products and lower amortization.

11:03 Other operating gains and losses were positively impacted by 90 million, The majority of which related to adjustments of earn-out viabilities. To summarize, we continue to see operating leverage in the business and profitability improving. Cash flow after continuous investments increased to 62 million per quarter compared to 20 million last year, more than tripling year-over-year, reflecting stronger profitability and improved cash flow generation. Our cash position continued to strengthen and reached 273 million at the end of the quarter, providing significant financial flexibility. At the same time, net debt decreased to 829 million and leverage improved to 1.3 times EBITDA, compared to 2.0 times a year ago.

11:59 Overall, we continue to combine strong growth with healthy cash generation and a strengthening balance sheet. And with that, back to you Fredrik.

12:07 Great, you are now back Patrick. Yes, thank you. Good stuff. All right, before we open up for the Q&A session, I'd like to reiterate some of our financial targets. And if we start by the growth target, which leads to on average growth revenue by 20% per year adjusted for currency effect, and that includes contributions from acquisitions. and in local currencies the second quarter growth was 15% which means we continue our growth trajectory also in the light of last year's exceptional growth and as I mentioned the market that we serve remains hugely underserved and hence we remain confident that there is ample opportunity for strong growth also going forward.

12:52 And as Jacob pointed out in the Recent five-year CAGR, that summarizes to over 25%, so we are well on that trajectory. The target on profitability reads to deliver an annual EBIT margin that reaches and exceeds 15%, and we have proven our ability to deliver strong growth paired with incremental improvements in profitability, and we have gone through a period of significant investments with a clear aim to build a robust and efficient operation that can And then lastly, our dividend policy... We have a very attractive cash flow profile, and given the growth opportunities, we need to maintain a capital structure that enables strategic flexibility to pursue growth investments, and that of course includes acquisitions.

14:01 But it is still expected to over time generate excess cash, and our policy is therefore to distribute at least 40% of the available net profits to shareholders via either dividends, share repurchases, or similar programs. When so allows and when the right prioritization. And this year, 2026, is the first year where we started to pay dividends. And given our ability to translate revenue into cash flow, as was also proven this quarter, we remain confident in our ability to deliver on this target too going forward. So in summary, we continue to see strong underlying demand across all our markets. The long-term opportunity remains substantial and unchanged. We grew revenue by 15% adjusted for currency despite the continued reimbursement related complexities and longer lead times in parts of the US.

14:54 The growth in Europe and other markets remains solid with particularly strong momentum in Germany and Australia as we continue to benefit from our investments in local execution and integration. Profitability improved significantly during the quarter. We are increasingly seeing benefits of the investments that we have made in systems and processes and organizational capabilities and that results in obviously improved efficiency and operating leverage. We also delivered stronger cash generation with their cash flow after continuous investment increasing by over 200% compared to the same period last year and if I look ahead we continue to monitor the reimbursement environment, the public spending development, the broader macroeconomic conditions closely whilst These factors may create short-term volatility, and the long-term fundamentals of the markets remain very attractive.

15:49 Our area of focus coming year will be to further align a global team that has grown significantly, both organically and via acquisitions, and in just a few years. This has happened in just a few years. Today, a global team of well over a thousand great colleagues that we see will ensure to be ready for a continued journey ahead. Overall, we believe that Dynabox is well positioned to continue delivering sustainable, profitable growth while, of course, advancing on our mission to help more people communicate and live more independent lives.

16:24 Okie dokie.

16:25 We are now inviting our colleague, Abtin Arant, who will help us to moderate and help us to take questions from the audience. Abtin, over to you. Thank you, Fredrik. Okay, I see we have already a couple of questions from the audience and we have one caller. Daniel Jurberg. If you would like, you can unmute yourself and also turn on your camera.

16:52 Well, let's see if you can hear me now.

16:56 We can sort of hear you, Daniel, but let's give it a shot.

17:00 Can you hear me now? Yeah. Super. Yeah, thanks. A couple of questions from my side. First on AbleNet, you had some positive non-recurring items in the quarter, 19 millions, etc. And you gained some from higher capitalization and lower RMD amortization. But my question is if you had any negatives on the NRI side, for example, from AbleNet litigation and so on.

17:33 No, it's a short answer. The AbleNet process is, these are costs that we are taking over our normal OPEX, and we obviously had these costs both before we launched the lawsuit in May, and we had them through Q2, and we had them through Q3. Obviously, this is the type of money that we would have loved to spend elsewhere, but there's nothing that we think we should adjust for. You also had another question, Daniel.

18:03 Yeah, it is a little bit on OPEX. I think it was up 7% year-over-year organically. And if you could say anything on the ambition ahead and also on gross margin, perhaps another question. But if you can give some ballpark details on, you know, the component headwind and tailwinds seen in the quarter.

18:26 Sure. Jacob, do you want to talk to the gross margin? Sure, I can.

18:31 Hi, Daniel. Well, when it comes to the gross margin, we have seen increased component costs and that is something that we are continuously looking over how to sort of mitigate that and one way to mitigate it is of course to work more efficiently and By doing so, we have looked into different type of freight solutions and by that lowered costs and been able to offset some of the margin pressure that we have seen due to increased component costs.

19:00 Yeah, so the component costs are real and they happen, but we're also quite proud to see that we're able to kind of fend that off to a fairly large degree by running a smoother machinery. then you can of course see that if we did not have the component cost increases that would have the underlying kind of operations and gross margin is actually strengthened. I believe you also had a question on overall optics. I think it's important of course when you're comparing years where we had significant one-offs etc. Do we still see that this is a company that scales? And yes we do. So even if we adjust for one-timers etc. we still see a A good kind of drop-through in margin expansion.

19:47 And we believe, obviously, that part of the investments that we have done, we have done them so that we don't have to increase OPEX on G&A, back-end systems, etc., so that we can grow with $1 without adding $1 in cost. That being said, we still want to make sure that we invest in our go-to-market capabilities, so sales, marketing... IT is obviously something that we need to continue to invest in because that's part of the tools how we can leverage the rest of the organization. Does that answer your question, Daniel?

20:24 Yeah, I think so. And thanks and good luck here in Q4 and I will get back in the queue. Great. Thank you. Thank you. Thank you, Daniel. We have a question from Jessica Grunewald from Red Eye in the chat and she's wondering about the Medicaid. How much did the Medicaid and managed care delays cost in Q3, and is it getting better or worse going into Q4? Does resolving the two-state cases change anything? Great.

20:56 Hi, Jessica. If I go up in the helicopter a little bit. So we have multiple funding sources in the U.S. that pays for our devices. They could be the federal systems called Medicare. It could be some of the almost 700 private insurance providers that we have contracted. Or it could be Medicaid, which is a state-run program. And Medicaid is either run by Medicaid themselves in that state or outsourced to something called a managed care organization. Today, the Medicaid and the managed care organization represents 40% of our current revenue, so it's significant. And we are seeing more fighting, if you will, and that typically comes from the fact that each state in the U.S. is required to have a budget imbalance.

21:44 So they're looking to do all kinds of cost-cutting, including medical expenses, etc. What This is not new, this has always been the case, but it's clearly so that that has increased lately. The way to mitigate that is of course to, when those cases arise, fight back or prove the fact that the law hasn't changed and you're certainly obliged to do it. That's what we refer to in the two cases in the specific quarter where there was like a short standstill and then they opened up. But we expect that this will happen also going forward. That being said, it's not like a customer can only have funding through, for example, Medicaid or Medicare. That's a little bit of a choice or a strategy.

22:30 So what we might see going forward is that more and more of our reimbursement revenue in the U.S. might actually move towards the other funding providers while we are ensuring that the go-to-market that we have today kind of sustains. And your last question, whether the solved cases will have any impact going forward. Well, to some degree, but it was only two states. And this is a whack-a-mole game. There's something new that will pop up every month. And probably what you're seeing is that there's been more of that happening lately rather than specific cases. So I don't know if that really answers your question, but this is a complex material.

23:17 Thank you. Next caller is Simon Larsson. Please unmute yourself and turn off your camera if you want and ask your question.

23:29 Perfect. Hopefully you can hear me. Loud and clear, Simon. Good, good. Good morning, everyone. Maybe starting on the earn-out reversal that had a quite big positive impact on reported EBIT in the quarter, so... Could you share any more information with us, maybe which acquisition this relates to, or which countries, or if we maybe also can expect more similar reversals just going forward?

23:56 Sure, this is a Jacob question.

23:58 Hi Simon, I'm not completely sure which acquisition it relates to, but how it works technically is when you acquire a company and you have an R0 component, You put the earn-out component as a liability on your balance sheet and then you assess that liability each quarter depending on the development towards the earn-out targets. And when you do this assessment and you do a reassessment where you think the likelihood of paying out parts of the earn-out decreases, the liability decreases, and that decrease hits your P&L as a positive impact. and in the quarter we saw a positive impact from that of 16 million.

24:44 Yeah, no, that's clear. Also then maybe on, yeah, staying in Europe, on Europe organic growth, I think it was 3% in the quarter, down a bit sequentially, I think it was 5% in Q2. What can you say about the organic situation in Europe, just in general terms? I suppose you're not maybe fully happy with what you're performing right now. So any sort of guidance and help on that?

25:12 Yes and no. This is where me as the engineer can debate whether IFRS rules and reporting really make sense. But if I paint the bigger picture, when we acquire, you know, all our acquisitions lately have been our own resellers. So if you buy a resale which has a turnover of 100, it's not like you add 100 to our P&L. You only actually add the difference of what we sold to them and what then they sell to the market. So you almost have to wait a full year until you have the anniversary of the acquisition to be able to compare apples to apples. So if you look at the actual FX address of growth in Europe specifically, that was 16% in the quarter. And that's kind of Actually how much the revenue grows, but because of the technicalities that I explained to you before, we don't see that as a fully organic growth, both in Q2 and Q3.

26:09 We celebrate the first anniversary of our German, which is a fairly significant acquisition on September 1. So in this quarter, you only had two months of, sorry, one month of actually kind of apples to apples comparison. and similarly we closed our also fairly large acquisition of our Italian reseller just before summer so it becomes a little bit technical but it's not a true apples to apples comparison that being said in Europe and the rest of the world we did have a few highlights but that also means that we had a few kind of markets that didn't perform as we want to the clear highlights were as just said Germany and Australia which is not in Europe and then we had some other markets where we expect performance to be a little bit higher.

27:02 Okay. Maybe the final one from my end on FX, because it seems like both me and maybe ConsenSys as well were quite wrong on FX this quarter. I think we all expected a tailwind, it became a headwind. Are there any dynamics in this that you can maybe speak about? I mean, timing of orders, etc. I know it's a bit of a difficult question, but if you can, comment anything on FX. Just something to be mindful of.

27:25 Yeah, Simon, it's back to the IFRS again, which can be a little bit confusing. So according to IFRS, you compare the year-to-date average FX rates to last year's year-to-date average FX rates. And when looking at that, you actually have a slight headwind due to sort of a spike in the US dollar and to some extent also the euro in the beginning of 2025. So that leads to a somewhat... Delayed effects on FX.

27:57 Okay, now that's clear. Okay, perfect.

28:00 Thanks so much. Because I can just clarify, your assumptions on currency flows is probably 100% correct. There's nothing funky going on kind of in the background.

28:12 Very good, thanks. Thank you. Next one is Jacob Lemke. Please unmute yourself and turn on your camera if you want.

28:29 Hi and good morning. Starting on the U.S. and the comments on the sort of turbulence among the insurers. Would you say that the situation has become worse here in Q3 or is it more unchanged compared to so in Q2?

28:45 Unchanged.

28:47 Good. Then also on that then... When I look at it, it seems like the North America sales when factoring in currency is down a bit sequentially here in Q3 compared to Q2. And my sense is it's typically in line or a bit stronger. So should we read anything into this?

29:07 Oh, that was a tricky question. I actually don't have an answer, but that's not my sense. Hence, we owe you a better answer going back. I'm sure I'm looking at Jacob here if you have a answer, but that's not my sense.

29:22 No, I understand the question, and maybe we'll have to come back to that one then, Jakob. But we do expect to see the same seasonal pattern. However, in this quarter, maybe we saw less seasonality due to the headwinds that we have described.

29:37 But that's not my gut feeling. I think the seasonality patterns that we have seen since forever largely remain.

29:49 Okay, good. Then on Europe, based on what you're seeing now across all of the markets, do you think that Europe can sort of grow in the double digits here going forward on an organic basis? I mean, Germany is becoming organic right in Q4.

30:08 Yes. Good. Short and sweet. Good.

30:13 And then also maybe on this currency, but how it impacts the profitability. So is there any currency, one also, or tailwinds in the gross profit and also any sort of working capital devaluation in the quarter?

30:29 I don't think so.

30:30 No, I wouldn't say so. Good. And then maybe finally also... Based on the current trends, how do you see the possibility to grow in line with your targets for 2027?

30:46 We typically don't respond to specific years, etc. But I think you hear me loud and clear. The ambition to, on average, grow revenue by 20% in local currencies absolutely remains because of the fundamental fact that our market remains the same, the loss remains the same, our products really really work, there hasn't been any huge shift in competition or other types of market dynamics so we basically reach the target but we also want to be clear that that probably means that there will be fluctuations over weeks, months, quarters and years and that's a natural view of looking at and I think also this year has to be seen in in the light of last year's exceptional growth.

31:37 And obviously, having tougher comps also plays into that.

31:46 Hey, good. That's all from me. Thank you.

31:48 Great. How are we looking, Abdi? We have a couple of callers left and then some questions in the chat. So, Philip, let's take a quiz if you want to unmute yourself, please. There we go. Do you guys hear me? Yes. Perfect. I forgot to unmute myself. Good morning. I have one question on the restructuring costs. It declined by around 9 million year-on-year in Q3, while last year you had around 14 million of restructuring costs. So should we interpret that that there was 5 million of extraordinary restructuring costs in this quarter?

32:36 No, that's probably not the right interpretation. That's a trick question for me if it is related to currency perhaps, etc. But on the restructuring of our R&D organization, as mentioned before, the restructuring costs were largely severance days. So basically for people that left in the U.S. And since the last person left the U.S.-based R&D organization in November of last year, Those are literally all behind us. So there must be some other kind of comparison that actually I don't have the answer to that. But there's been no other restructuring things that date basically.

33:22 All right. And then one on R&D capitalization, which increased by around 10 million while amortization declined. So how should we think about the relationship between capitalization and amortization? Amortization going forward. Pass that to Jacob.

33:40 That's a very good question, but what's the question really? I mean, how you should look at it? Yeah, with how it should interpret it, hitting the P&L going forward with capitalization and amortization since this quarter you Like, you had a net positive effect on the P&L since you capitalized more than amortized.

34:02 Yeah, and the reason for that is that we have new product launches coming up in 2027 and that sort of increases our capitalized R&D compared to prior years, basically.

34:15 I think you can go up in the helicopter. We spent last year reorganizing to make sure that we have a machine that can deliver much more innovation Higher quality, etc. But of course, while you're doing that, the level of new product development frankly goes down to some degree. Now, since the beginning of this year, this team is in place and they are on fire. And you should probably see over time that you will have higher capitalization when we are building and developing new products as soon as they're launched. Then we start to depreciate on those capitalizations and that cycle will always be a little bit of a swing back and fro. And right now the swing is kind of in the direction of more capitalization, but you will of course over time.

35:04 That should even out more or less. Yeah, but so we should assume that we will see an inflection in beginning of 27 if you have some product launches coming up.

35:17 Yeah, and product launches in our space is not like, you know, big bang product launches. They are more evolution rather than revolution. So the numbers are made up of several parallel exciting projects. So there isn't a specific date when kind of the pendulum swing turns. All right. Thank you. Thanks. We have questions from Mikael Lassen in the chat, and he's asking about the complexity that we highlighted regarding Medicaid and Medicaid-managed care organizations in the US. He's asking what specifically has changed during Q3, and did you see this also in Q2?

35:59 Yeah, and I think almost nothing has really changed. I think that the complexities that we experienced before summer sustained, There's a new challenge in a certain state or a certain place that pops up. Then we kind of take out that fire and then perhaps something new. But I wouldn't say that there has been any material change since the beginning of the year. He's also wondering regarding the insurance related issues highlighted in H1 in the U.S. How did that develop during Q3? Have conditions improved, stabilized or deteriorated?

36:41 Probably almost the same question. So they're the same. Neither worsened or gotten better. And are we seeing any increase in rejected claims or is it more longer approval times that is?

36:58 If you have a specific claim and then you have a denial, that also happens and then we have a process to try to overturn that or appeal that. The ratio between cases being rejected and the ratio of cases coming out of our pipeline has not changed. Great. Nikola Kalonsky, please unmute yourself and That's your question.

37:31 All right. There we go. I hope you can hear me. Yeah. All right. Just a few questions for me. So the first one is on Europe. And Europe grew something like 16%, I think, on an FX adjusted basis in Q3 year on year. And then you did have this really tough comp of over 50% growth last year. But I'm thinking, given the strength in Germany, which I think you've highlighted a couple of times, It seems maybe some parts of Europe were a bit softer. And with that in mind, could you help us decompose Europe a bit more country-wise? It doesn't have to be in terms of numbers, but just in terms of some extra granularity, that would be great.

38:11 Yeah, but I can give one example and then I can give you more of a nuance. We are dependent in France on public financing for products. And anybody that reads the newspapers understands that the French situation right now is complex. to say the least. So that's an example of how it is sometimes softer and maybe the French situation is more grave because it's a bigger item. Then we have other markets where fluctuations or in this case negative fluctuations can actually be more technical. We have tender markets. So some of our markets we basically sell through tenders. So it's not like we ship our device to the individual end users like we do for example in the US or in Germany. We sell our devices to a Thank you very much.

39:21 Some of the tailwinds that we experienced, as I mentioned, in Germany, and also even though Australia is not a part of Europe, but also Australia, was then countered a little bit by some of those markets, such as France, such as some of the tender markets. Does that give you a better nuance of the field you're operating in?

39:43 Yeah, that's definitely helpful. That's very helpful, especially the commentary on the tender markets and the associated swings. And just the final one, if we look at, I guess, a bit of the medium to longer-term trend here, being how you're growing in terms of the number of solutions consultants in the U.S., what's that pace looking like, and has it changed compared to your history, compared to last year, for example?

40:13 Thank you very much. We remain confident that one of the most concrete levers we can pull in order to grow revenue is actually to have more people on the field. And that's not just the US. That's equally the truth in, for example, Germany, or Australia for that matter. So we haven't changed our model where that is the area where we invest the most, but there will also there be a little bit of a swing where we will have, you know, The class of the fall of 2025 is probably bigger than the class of the spring 2026, etc.

41:10 But our ambition and our strategy remains.

41:15 Just maybe to follow up, would the class of 2026 be approximately the same size as the class of 2025? I mean, if we just adjust the way for all of these seasonal effects and the spikes.

41:28 Yeah, that's a good kind of ballpark understanding.

41:32 Yeah. Fair enough. Okay, that's all for me. Thank you so much. Great. A couple more questions from Mikael Assen. Regarding North America's 16% organic growth, was that mostly driven by higher unit volumes, or mix, or price?

41:48 We have, the AFP is largely identical, so it's only volume increases. Correct. And another question from Mikael as well. He's asking if we can quantify the positive EBIT impact from the reversal of contingent earn-out liabilities included in the 19 million of operating income.

42:07 Yeah, and we answered that question earlier, and it's 16 million in the quarter. Perfect. We have one more calling in, and that's Jacob again, if you want to unmute yourself, please.

42:23 Yeah, thanks. A few short, further questions. So, Just on OPEX, when I calculate and try to understand it on a sort of underlying basis, excluding all of the one-offs that has been, it seems like you're still growing costs a bit faster than your revenues, and it'd be interesting to hear your thoughts about this, and in order for this to reverse, will you have to accelerate revenues, or will you also start to adapt the cost growth you're going for?

42:57 It's not entirely a correct analysis. I think we have a quite decent gap between revenue growth and cost growth. There will be currencies, etc. But I also would like to say that the effects of the investment that we have done in, for example, ERP systems and digitalization, those are yet to be harvested. The platform we have right now, I think, is a platform built for growth. And my main ambition to grow OPEX, or if you will, is to kind of the previous conversations is in field reps. So basically sales and marketing and people on the street, certain areas where it comes to continuing investing in IT. But I am expecting more of a leverage when it comes to all the other G&A functions, if you will.

43:54 Okay, good. Then also on the currency impact on top line, which you elaborated on earlier, it seems like it's calculated a bit different than I have done it, but just for Q4, is it possible to guide on what the currency impact will be? I think based on the sort of current rate, I would imagine it would be fairly positive, but if you could elaborate on that.

44:24 I think we'll have to look into that analysis, Jacob, because then I need to go back to 2025 and look at the currency fluctuations and what that would give in terms of average. So I'll have to come back to you on that question.

44:36 But I would assume that we can all make, you know, the average FX, you know, year to date, so between January 1 and December 31, 2025, versus the average FX, and it's largely dollar to SEC and euro to SEC, but largely dollars to SEC. I would assume that... But of course we can't predict what the currency FX rates will be in Q4 yet. But assuming they are the same, and given that in absolute terms the dollar has strengthened to the SEC, the headwind should turn to a tailwind quite soon.

45:16 Agreed. But it's difficult to quantify, Jacob, exactly how much. But I completely agree with Fredrik.

45:22 But it also means that it will sustain into next year, you know, a little bit depending on how the effects develop.

45:33 Very good. And then maybe just finally, I'm just wondering a bit, have you changed the way you calculate your organic growth in any way recently? Because the numbers don't really align with how I have had it before.

45:48 No, we haven't changed anything.

45:52 Okay, good. That's all for me. Thank you. I have a last question, I think, from Mikael Asien. He's asking, you state that the specific reimbursement challenges in two major U.S. states were resolved during your favor in Q3. How much did challenges in these two states affect Q3 sales? What exactly was resolved, and have you already seen a positive impact on approvals and deliveries And does this remove the issue entirely, or do you see similar disputes arise in other states?

46:26 So I don't have a number to give you, Mikael, but I can explain a little bit on what happens. So when you have one of those states where they basically say, for now, we're halting because we're evaluating, that of course means that you build up some sort of backlog of cases that are not served, and then once the halt, which in both these cases basically were lifted, and those cases, they pop through the system. Whether we manage to get all of those held back cases delivered during the quarter or if some of those pops into Q4 remains to be seen. But it's also only two out of 50 states in the U.S. And they were resolved by basically how I explained it.

47:11 There was a temporary halt and then it opened up. And then going forward, I expect that more of these cases will pop up and then we will resolve them. If they're all fully solved within a specific quarter, I cannot tell. But it's typically not longer than that. Great. I think that concludes the Q&A. Excellent. Thank you very much, Abdin. Thank you for great questions on our favorite topic, this company and our performance. But that concludes today's call. We're sorry for the slight delay and video issue. We will make sure to sort that out by February 4th, because that's when we will summarize the full business for 2026. Have a great day. Thank you.

48:00 Thank you. Bye.