Annual Report 2025

TABLE OF CONTENTS

3 SMARTOPTICS

4 2025 IN BRIEF

5 MESSAGE FROM THE CEO

6 BUSINESS OVERVIEW

9 CUSTOMERS

14 PRODUCTS

23 BOARD OF DIRECTORS

25 MANAGEMENT TEAM

29 BOARD OF DIRECTORS REPORT

39 FINANCIAL STATEMENTS FOR THE GROUP

44 NOTES FOR THE GROUP

63 FINANCIAL STATEMENTS FOR THE PARENT COMPANY

67 NOTES FOR THE PARENT COMPANY

2 | Annual Report 2025

‌SMARTOPTICS

Smartoptics provides innovative optical networking solutions for a new era of open networking. We focus on solving network challenges and increasing the competitiveness of our customers. Our customer base includes cable and telecom operators, cloud providers, Internet exchanges, governments and thousands of enterprises.

At Smartoptics, we leverage modern software design principles and expand network horizons by taking an open approach in everything we do. This empowers our customers to break free from unwanted vendor lock-in, remain flexible and minimize costs.

Our solutions based on open networking standards and protocols are used in metro and regional network

applications as well as in metro access networks. The products we deliver are based on in-house developed hardware and software and enhanced by associated services.

Smartoptics is a Scandinavian company founded in 2006. We partner with leading technology and network solution providers and hold numerous certifications and approvals from major switching and storage solution providers such as Brocade, Cisco and Dell. We have a global reach through our salesforce and more than 100 business partners including distributors, OEMs and VARs.

As a challenger, we take pride in our open approach, smart design principles and ambitious customer service.

Corporate headquarter in Oslo.

Main offices in Stockholm & Amsterdam, NY Representatives

WORLDWIDE PRESENCE

Geographical definition

Americas EMEA APAC

3 | Annual Report 2025

‌2025 IN BRIEF

HIGHLIGHTS

• Revenue of USD 75.3 million compared to USD 55.5 million in the same period 2024, which corresponds to an increase of revenue by 35.6%

• Gross margin of 47.8% compared to 48.1% same period 2024

• EBITDA of USD 9.7 (5.6) million, equivalent to an EBITDA margin of 12.9% (10.1%)

• Operating profit (EBIT) of USD 6.8 (3.3) million, equivalent to an operating margin of 9.0% (5.9%)

• Smartoptics continued to gain traction with larger customers, including communication service providers, Internet content providers and regional network operators. The large account strategy delivered encouraging results.

• During 2025, Smartoptics successfully uplisted to the main board of Euronext Oslo Børs, strengthening the company's visibility in capital markets and supporting continued international growth.

4 | Annual Report 2025

‌MESSAGE FROM THE CEO

2025 was a transformative year for Smartoptics. We delivered strong growth, improved profitability, and important strategic milestones, confirming the strength of our business model and our position in a rapidly evolving optical networking market.

For the full year, Smartoptics reported revenue of USD

75.3 million, representing 35.6% growth compared to 2024. Profitability also improved significantly, with EBITDA reaching USD 9.7 million, corresponding to an EBITDA margin of 12.9%, and EBIT of USD 6.8 million, equivalent to an operating margin of 9.0%. Our gross margin remained stable at 47.8%, while operating cash flow was USD 8.5 million, reflecting the scalability of our business model as revenues continue to grow. The total optical transport market reached USD 16.5 billion in 2025 and is expected to grow to USD 23.7 billion by 2029, driven largely by increasing investments in artificial intelligence infrastructure - a structural tailwind that is reshaping demand across our core markets.

The strong performance was driven by increasing demand across our core segments. Investments in data center connectivity, cloud infrastructure, and the rapid expansion of AI-driven workloads are reshaping the optical networking market. Smartoptics' open, flexible and cost-efficient solutions are well aligned with these trends, enabling our customers to scale network capacity while maintaining operational efficiency.

Throughout the year, we continued to gain traction with larger customers, primarily within our two customer segments: Network Operators and Cloud/AI. Our large account strategy showed promising results, while our extensive product portfolio-including optical devices, solutions, and software-keeps strengthening our competitive position. Our approach is based on open networking principles and disaggregated WDM architectures-a philosophy that the market is increasingly recognizing.

A key milestone during 2025 was our successful uplisting to the main board of Euronext Oslo Børs. This step increases our visibility in the capital markets, improves liquidity in the share, and provides access to a broader international investor base. The uplisting reflects both the maturity of the company and our ambition to continue scaling the business in the years ahead.

Geographically, the Americas continued to lead our growth during the year, supported by strong investments in network infrastructure and increasing demand from data center and cloud ecosystems. At the same time, we saw improving momentum across our European markets and continued development in other regions.

Smartoptics operates in a market that is undergoing structural growth. Global data traffic continues to expand rapidly, driven by cloud computing, AI infrastructure, and increasing digitalization across industries. Our focus on open optical networking, combined with a scalable operating model and a growing software offering, positions us well to capture these opportunities.

Looking ahead, our priorities remain clear. We will continue to expand our presence among large accounts, strengthen our software capabilities, and invest in product innovation to support larger networks, higher network speeds and more automated optical networks. At the same time, we remain committed to disciplined execution, balancing growth with profitability and strong cash generation.

Finally, I would like to thank our customers, partners, shareholders, and employees for their continued trust and commitment. The achievements of 2025 would not have been possible without the dedication and expertise of the entire Smartoptics team. With strong momentum and a clear strategic direction, we look forward to continuing our growth journey in the years ahead.

For further information, please contact: Magnus Grenfeldt, CEO

5 | Annual Report 2025

‌BUSINESS OVERVIEW

REVENUE BY GEOGRAPHY REVENUE BY BUSINESS AREA

80.0

70.0

80.0

70.0

60.0

50.0

40.0

3.3

27.1

60.0

50.0

44.3

40.0

30.0

20.0

28.1

25.9

10.0

30.0

44.4

20.0

10.0

0.0

2023 2024 2025

Americas EMEA APAC

0.0

2023 2024 2025

Solutions Devices Software & Services

Revenue is generated globally across the Americas, EMEA and Asia-Pacific, reflecting Smartoptics' international customer base and global sales organization.

In 2025, the Americas represented the largest share of revenue at approximately 58.8%, followed by EMEA at 33.2% and APAC at 8.0%.

The strong performance in the Americas was primarily driven by increased investments from communication service providers and internet content providers, particularly related to data center interconnect and AI-driven infrastructure deployments.

EMEA continues to represent an important market for Smartoptics, supported by an established partner ecosystem and growing traction among large accounts during the second half of 2025.

Revenue in APAC is typically more project-driven and therefore subject to greater quarter-to-quarter variability.

The geographic revenue mix reflects Smartoptics' strategic focus on markets with strong demand for metro and regional optical networking infrastructure.

Smartoptics' revenue is generated across three business areas: Solutions, Optical Devices, and Software & Services.

In 2025, Solutions represented approximately 59.0% of revenue, Optical Devices 25.9%, and Software & Services 15.1%.

The Solutions segment includes the company's optical transport systems based on the Dynamic Connectivity Platform (DCP), including open line systems, transponders and muxponders. This segment represents the core of Smartoptics' business and reflects the company's focus on system-level optical networking solutions.

Optical Devices includes optical transceivers and passive optical components. The segment delivered strong growth during 2025, including a record quarter in Q4 driven by increased demand across customer segments.

Software & Services includes network management software, technical support and professional services. The segment is closely linked to the installed base of Smartoptics systems and represents an important source of recurring revenue.

The revenue distribution illustrates Smartoptics' strategy of combining hardware platforms with software and services to deliver complete optical networking solutions.

6 | Annual Report 2025

BUSINESS OVERVIEW

REVENUE BY CUSTOMER TYPE REVENUE BY CHANNEL

80.0

70.0

60.0

50.0

80.0

70.0

60.0

50.0

40.0 40.0

30.0

20.0

26.0

10.0

30.0

51.5

39.5

42.6

20.0

27.6

10.0

0.0

2023 2024 2025

Enterprise CSP ICP

0.0

2023 2024 2025

Indirect Direct

Smartoptics total revenue increased from USD 55.5 million in 2024 to USD 75.3 million in 2025, reflecting strong demand for optical transport solutions in metro and regional network environments.

Communication Service Providers (CSPs) represented the largest customer segment in 2025, generating USD 32.7 million in revenue, corresponding to 43.4% of total revenue, compared to USD 19.8 million in 2024. This represents 64.5% year-over-year growth. The increase reflects continued investments by telecom operators in metro and regional optical transport infrastructure to support rapidly growing bandwidth demand.

Revenue from Enterprise customers amounted to USD 27.6 million in 2025, compared to USD 26.0 million in 2024, corresponding to 36.6% of total revenue representing 5.8% year-over-year growth. While enterprise networks remain an important part of the company's business, growth in this segment was more moderate compared to the infrastructure-driven segments.

Revenue from Internet Content Providers and Internet Exchanges (ICPs/IXPs) increased from USD 9.6 million in 2024 to USD 15.0 million in 2025, corresponding to 20.0% of total revenue, representing 56.5% year-over-year growth.

The strong growth in the CSP and ICP segments reflects structural industry trends driven by the expansion of hyperscale data centers, increasing cloud traffic and the rapid growth of artificial intelligence workloads. These trends are driving demand for high-capacity optical transport solutions connecting data centers and network aggregation points, particularly in metro and regional network architectures where the company's solutions are typically deployed.

The company's revenue is generated through a combination of indirect partner channels and direct sales.

Indirect sales channels represented the majority of revenue, accounting for USD 51.5 million in 2025, compared to USD 39.5 million in 2024, corresponding to 68.4% of total revenue and representing 30.4% year-over-year growth.

Indirect channels include value-added resellers, distributors and system integrators that provide local market coverage, network design expertise and deployment services. The company's partner ecosystem enables efficient market access and scalability across a broad set of geographic markets and customer segments.

Direct sales accounted for USD 23.8 million in 2025, compared to USD 16.1 million in 2024, corresponding to 31.6% of total revenue and representing 47.8% growth year-over-year. Direct engagement typically occurs with larger infrastructure customers, including telecom operators and internet infrastructure providers, where network deployments often involve closer collaboration on architecture and solution design.

The combination of direct and indirect sales channels enables Smartoptics to efficiently reach customers worldwide while maintaining close relationships with key strategic accounts.

7 | Annual Report 2025

BUSINESS OVERVIEW

MARKET DEVELOPMENT

USD BN

25

20

15

10

5

0

2025 2026 2027 2028 2029

Optical Hardware

The total optical transport market amounted to USD 16.5 billion in 2025 and is expected to grow to USD 23.7 billion by 2029. This represents a material increase in expected growth compared to previous estimates, primarily driven by investments related to artificial intelligence infrastructure.

In 2025, Smartoptics primarily addressed the global Metro WDM market, which accounted for approximately 39% of the total optical transport market.

When estimating market share, the company focuses on the metro WDM market in North America and EMEA. Although this is not the only market Smartoptics addresses from a technical or geographic perspective, it serves as a relevant reference market for assessing the company's position. This market is expected to grow at approximately 6.3% annually through 2029.

* SOURCE: CIGNAL.AI DATA: TRANSPORT HARDWARE REPORT (2026-03-09)

8 | Annual Report 2025

‌CUSTOMERS

The Ever-Growing Demand for Bandwidth

HD Video Streaming

Streaming a show on TV

Average

usage, Mbit/s

0.4

7.6

Internet traffic

in the US

Live Gaming

Playing Online multiplayer game on a gaming console

0.1

1.5

Video Conferencing

Hosting a group video call on a laptop

0.5

2.1

1990

2022

THE EVER-GROWING DEMAND FOR BANDWIDTH

Communications are a central element of our lives, both in a professional and private sense. We scroll among unlimited streams of video content on the TV, we play computer games with our friends, and we participate in video conferences with colleagues on other continents. Where telecommunications once meant just telephony, today streaming services, Internet access, data sharing, and video communications have become mainstream applications, making up the vast majority of all the information transported over the electronic web spanning the Earth. At the same time, artificial intelligence (AI) is revolutionizing the way we interact with digital communications. AI-powe-red algorithms enhance video quality in real-time, personalize content recommendations, making our interactions with the digital world more seamless and efficient. As AI continues to evolve, it will further shape the future of telecommunications, enabling smarter, faster, and more adaptive communication networks.

The traffic growth in communication networks has been significant. And this will continue. Technological innovation and mass production have gradually reduced the cost of each transported bit. And a lower bandwidth cost spurs the innovation of even more bandwidth hungry applications. The shift towards higher capacity communications networks is in a positive feedback loop and it will roll on for a long time.

This trend is the driving force behind the global demand for the high capacity, optical transport solutions provided by Smartoptics. Hence the Smartoptics' customers are found among the cable and telecom operators, cloud service providers, Internet exchanges, governmental agencies and enterprises striving to keep up with their users' never-ending need for more bandwidth.

9 | Annual Report 2025

CUSTOMERS

CUSTOMER TYPES

COMMUNICATION SERVICE PROVIDERS

Public networks, operated by cable and telecom providers, are among the biggest communication networks in terms of user base. These operators offer bandwidth capacity and related services to their customers. Their users range from large numbers of consumers with broadband access to enterprises active in time-critical businesses such as e-commerce or media streaming, putting great demands not only on fast but also on fail-safe connections. These Communication Service Providers (CSPs) form Smartop-

tics' largest addressable market segment and use Smartoptics products to build cost efficient optical networks interconnecting the CSP's major points of presence and providing network access for the CSP's users.

The CSP's networks typically have a hierarchical structure where traffic from many users is aggregated and then transported over common long-distance connections.

• Regional Network - Connectivity between cities in a region. 100Gbit/s, 400Gbit/s and 800Gbit/s. Several hundred connections

• Metro Networks - Connectivity between major Datacenters. 100Gbit/s, 400Gbit/s and 800Gbit/s. Several hundred connections

• Metro Edge Networks - Backhaul of Data to major Datacenters. 10Gbit/s up to 400Gbit/s. Several thousand connections

The hierarchical structure of the CSPs' networks offers multiple opportunities for the deployment of Smartoptics open line systems, transponder, and muxponder products: At the regional level, which interconnects cities, 100G, 400G, and 800G DWDM line systems with DCP-R ROAD-Ms from Smartoptics are in strong demand when building ring and mesh shaped networks. Within cities, i.e., at the metro level, additional DWDM rings at 100G and 400G built with ROADMs from Smartoptics are used to meet the demand for further distribution of the CSP's bandwidth. And to reach the thousands of CSP users, access and edge networks using Smartoptics 10G and 100G open line systems with transponders/muxponders as demarcation devices are deployed.

The CSPs have a recurring demand for more bandwidth between their points of presence, as well as significant expansion needs when building backhaul networks for

e.g., 5G and broadband access. A recent trend is that CSPs increasingly invest in IP over DWDM solutions with open line systems, which is an excellent match for the new ROADM and open line system offerings based on the Dynamic Connectivity Platform (DCP) from Smartoptics. Thanks to the open interfaces (APIs) of the Smartoptics' products and by using the SoSmart Software Suite from Smartoptics, the CSP may also create a complete and simple to use "point-and-click" management solution for his optical network. Or alternatively, the Smartoptics' IP over DWDM solutions can be integrated with the existing management and provisioning systems already in place. Hence, the IP over DWDM solutions from Smartoptics offer the CSP both a lower cost and simpler management than traditional optical transport systems.

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Long distance Network

(Ciena, Infinera, Nokia, etc.)

San Francisco

Los Angeles

Regional Network (10xN)

SFO

Oakland

Metro Network (100xN)

San José 1

San José 2

Aggregation router

Metro Edge Network

(1000xN)

Mobile Network

Access Network

CUSTOMERS

RURAL COMMUNICATION AND BROADBAND SERVICE PROVIDERS

A special type of Communication Service Provider is the rural service provider, serving less densely populated areas and remote regions of a country. The rural service providers often play a crucial role in the digitalization policies of a country and in the strive to bring an equal set of digital services to all citizens.

In the initial deployment phases, the rural service provider can seldom afford to use the powerful optical transport

solutions that have been designed primarily for the "tier 1" types of networks in a metropolitan area. Rather, the rural service provider requires solutions that have a low entry cost, are simple to operate, but also have the potential to be upgraded to higher capacities when the need arises. Hence, the rural optical network becomes an excellent application for Smartoptics' IP over DWDM architecture. It allows for an efficient mix of active/passive solutions for broadband backhaul combined with a regional network consisting of upgradable, easily manageable, open line systems using ROADMs and long reach optics.

Active Hub

Passive Filters

Regional Network

Active Hub

Access Network

Active Hub

Passive Filters

• Regional Network - Connectivity between major nodes in the area at 100Gbit/s, 400Gbit/s and 800Gbit/s. Using active equipment that routes traffic to and from the access network rings.

• Access Network - Backhaul of traffic from radio base stations, enterprises and businesses to the active

Passive Filters

Passive Filters

Passive Filters

hubs of the regional network. Using optical filters hence no power is required at the add/drop sites.

11 | Annual Report 2025

CUSTOMERS

INTERNET CONTENT PROVIDERS AND INTERNET EXCHANGES

An Internet Content Provider (ICP) is an organization that creates information, entertainment, or other content for online delivery over the Internet. ICPs deploy high-capa-city optical networks within their data centers and for back up between datacenters. Some of the larger ICPs also maintain their own international optical transport network to reduce their media distribution costs.

Internet Exchanges (IXPs) are peering points for Internet traffic, allowing participant Internet Service Providers (ISPs) to exchange data for their respective networks. An IXP organization typically operates several such exchange points in one or more countries as well as Points of Presence (POP) in relevant data centers, all interconnected by a dedicated optical transport network

The ever-growing demand for bandwidth drives ICPs and IXPs to request bandwidth at a very attractive cost per bit,

when interconnecting their sites. A preferred way of achieving this is to deploy IP over DWDM solutions from Smartoptics, removing transponders and decreasing the overall cost of the transport layer. When even higher capacities are required or if the switches only have low speed ports, using e.g., the Smartoptics DCP-404 muxponder paired with 400G transceivers is an excellent alternative. This muxponder can run four 100G links over 400G, using only one fiber pair instead of four, in a compact and efficient form factor. By simply adding more DCP-404s into a single rack unit, it is even possible to expand capacity by up to a factor of four.

Smartoptics innovative and fully open DCP platform simplifies all types of IP over DWDM deployments by reducing cost and automating network configuration. An IP over DWDM architecture further has the advantage of leveraging technology advances more rapidly than traditional systems, thereby facilitating a continuous update of the DWDM connections from 100G to 800G and beyond.

IX Core 1

IX Core 2

• Point-of-Presence (POP) - connectivity needs an Internet Exchange (IXP) with two core routers.

POP 1 POP 2 POP 3

12 | Annual Report 2025

CUSTOMERS

ENTERPRISE AND GOVERNMENT DATA CENTERS

Like ICPs and IXPs, enterprises and government agencies use Smartoptics' products to boost the bandwidth transported over optical fibers when interconnecting their data centers. With IP over DWDM solutions offered by Smartoptics it is possible to transport up to 26 Terabit/s over one fiber pair, and to mix and match Ethernet traffic with e.g., storage specific protocols like Fibre Channel. The unprecedented software automation offered by the DCP platform allows the customers to use this advanced technology with very limited in-house competence in how networks are installed, commissioned, and operated.

Enterprise and government projects are typically smaller than CSP and IXP projects but often result in recurring revenues over several years. Normally network utilization grows and transport capacity may have to be upgraded by 10 - 50% in the years following the initial deployment. And since there is typically 4-5 years between new technology cycles, a complete re-investment in the optical network often occurs after about 5 years.

Datacenter

Datacenter

Backup Datacenter (Enterprice), Datacenter 2, 3… (ICP)

Datacenter

10G

25G

32G

100G 100G

400G

N x 100/400G or FC

Up to 100km Up to 16 Tbit/s

100G

400G

10G

25G

32G

100G

Servers and Storage Routers

Transport/Optical

Transport/Optical

Routers

Servers and Storage

13 | Annual Report 2025

‌PRODUCTS

OVERVIEW PORTFOLIO

DENSE WAVELENGTH DIVISION MULTIPLEXING -DWDM

Smartoptics offers products for high-performance and scalable optical transport solutions over optical fibers. The fundamental technology underlying the products is called Wavelength Division Multiplexing (WDM) and Smartoptics is primarily utilizing a form of this technology referred to as Dense Wavelength Division Multiplexing or DWDM.

In DWDM, data carried by separate electrical signals is transformed into light pulses of different colors. These colored signals can then be sent over an optical fiber and retrieved at the receiving end by picking up each individual incoming color separately. The colors are combined into the light stream to be transported by the fiber using a device called a multiplexer and then, at the other end

of the fiber, the light stream is separated into individual wavelengths again by use of a demultiplexer, so that they can be sent to the correct receiver. The optical fiber with multiplexers, demultiplexers, and strategically placed optical amplifiers, is often referred to as a line system, while the conversion between the electrical and optical signals is performed by pluggable transceivers.

Thanks to the wavelength multiplexing the customer gets access not to one, but to many independent, two-way communication channels, even with just one fiber pair deployed between the sites. This allows enterprises, for example, to build corporate communication networks for video conferences, data communications and server back-up, all using the same fiber infrastructure. Similarly, a telecom operator can leverage the same fiber network for both telephony, Internet services and high-speed data center interconnect (DCI) solutions services, without having to deploy costly separate long distance fiber cables.

Illustrations of function of an Open Line System

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PRODUCTS

IP OVER DWDM WITH OPEN LINE SYSTEMS

Until recently, all optical transport networks were built using dedicated, monolithic, optical transport systems originating from the telco world. However, an open architectural approach is now increasingly applied to optical networking, using IP over DWDM, i.e., pluggable optics in standard IP routers and switches, and open line systems including everything needed for the DWDM channels to be carried over longer distances (amplifiers, dispersion compensation, ROADMs etc.). A new breed of disaggregated network solutions has emerged, relying upon standardized hardware with embedded WDM capabilities and with the option of being steered from the same Software Defined Networking (SDN) controllers as other parts of the network.

IP over DWDM solutions are critical for enterprises and cloud providers seeking cost-effective, high-capacity Data Center Interconnect (DCI) and for Communication Service Providers (CSPs) for metro edge and metro/ regional networks. The building practices, use of pluggable optics, SDN etc. originating from the enterprise data centers have laid the foundation for a new generation of optical networks, reaping the rewards of breakthroughs in DWDM and transceiver technology. The Smartoptics' products are designed for this new era in optical communications.

15 | Annual Report 2025

Open configuration

Legacy configuration

Trp/Mxp

Router

Router

Fiber

DWDM

Trp/Mxp

Fiber

Trp/Mxp DWDM

Router with

embedded transceiver

Open line system

Optical transport equipment vendor

PRODUCTS

PRODUCT PORTFOLIO

Smartoptics' product portfolio comprises Optical Solutions, Optical Devices and Software & Services.

OPTICAL SOLUTIONS BASED ON THE DYNAMIC CONNECTIVITY PLATFORM (DCP)

To meet the diverse requirements of IP over DWDM with active and open line systems, Smartoptics has designed the Dynamic Connectivity Platform (DCP) as a multipurpose base, supporting the optical networking needs of both operators and enterprises. The DCP platform uses an open architecture supporting pluggable transceivers, open line systems, and SDN control, resulting in a superior price/performance when compared to legacy solutions.

The DCP platform can be used in all types of IP over DWDM optical networks, may they be simple point-to-point links or advanced, ROADM-based, ring and mesh networks. To fit the varying needs of IP over DWDM, the DCP platform comes in several flavors: The DCP-M, the DCP-R, and the DCP-F open line system families, and a comprehensive portfolio of transponders and muxponders.

The DCP platform is designed for scalable deployments, from small-scale enterprises to large-scale service provider networks and to cater for use in special situations. Management of all DCP platform products can be done using the SoSmart software suite from Smartoptics.

THE DCP OPEN LINE SYSTEM FAMILIES

An open line system may be anything from a set of passive optical filters and a fiber to a complex, meshed ROADM network with multiple active elements. To meet the diverse requirements of active open line systems, Smartoptics has introduced three families of DCP products:

THE DCP-M FAMILY

For automated provisioning with minimal manual intervention of point-to-point links with multiple traffic formats at speeds up to 800G, optimized for cost-efficiency and high bandwidth capacity. The DCP-M family comprises six models for either 8, 32, or 40 channels, dedicated for either 100G DWDM PAM4, 400ZR, 800G, or for applications with any mix of PAM4, NRZ and coherent 100/400G channels. The DCP-M products have a fixed form factor chassis, and each model is designed for a particular use case.

THE DCP-R FAMILY

For any type of ring and mesh shaped ROADM network with multiple traffic formats, focusing on service reliability and wavelength manageability. The DCP-R products enable advanced topologies with up to 34 degrees (fiber directions) and support of a mixture of modulation formats such as 400ZR OIF, 800G, NRZ, and coherent wavelengths. The DCP-R products also have a fixed form factor chassis, and each model is designed for a particular application.

The DCP-M/DCP-R chassis (top) and the DCP-2 chassis with a DCP-F-A22 amplifier and a DCP-F-R22 micro ROADM (bottom)

16 | Annual Report 2025

PRODUCTS

THE DCP-F FAMILY

For configuration of all types of open line systems with a set of versatile, active, optical units that can be used on their own or extend the functionality of the DCP-M and DCP-R families as well as being used in active/passive optical ring applications. The DCP-F units have a uniquely high level of flexibility based on a building box concept with flexible optical modules that fit into a DCP-2 chassis.

THE DCP TRANSPONDERS AND MUXPONDERS

For use cases where a stand-alone transponder or muxponder adds value, Smartoptics has introduced a separate family of DCP-2 based transponders and muxponders. Using a transponder, a short range electrical or op-

tical signal from a switch or router can be converted to a long range DWDM signal for transport over an open line system. The transponder/muxponder may also perform encryption of the optical signal and optical channel quality monitoring.

The DCP-108, DCP-802, DCP-1203, and the DCP-1610

transponders are typically used to adapt switches and routers that do not accept pluggable CWDM/DWDM transceivers to use an open IP over DWDM line system. These products also often act as a demarcation device between a service provider's network and his subscribers.

DCP-108

DCP-1203

DCP-1610

DCP-404

DCP-110

DCP-802

The Smartoptics DCP transponders and muxponders.

17 | Annual Report 2025

PRODUCTS

The DCP-110 muxponder offers a cost-effective way of aggregating up to ten 10 GbE signals into one 100G channel to be transported over a DWDM line system. Similarly, the DCP-404 muxponder enables the multiplexing of four 100GbE signals into one 400G channel for the most bandwidth efficient utilization of the available fiber infrastructure.

THE SOSMART SOFTWARE SUITE

SoSmart is a modular software suite for SDN-based management of Smartoptics' products in an open, multi-lay-er and multi-vendor optical networking environment. The management suite features a cloud-native software architecture with open APIs for seamless integration that enable a high level of management flexibility, modularity, and multiple integration possibilities with other systems and products.

Using the graphical user interface of the suite's SoSmart Manager, a network operator can dynamically provision capacity, monitor performance, and track down problems in the underlying physical optical network. Alternatively, the SoSmart suite acts as an adaptation layer between the network elements from Smartoptics and higher-level multi-vendor network management systems and orche-strators.

The Smartoptics SoSmart Software Suite for open network management includes the following building blocks:

SOSMART MANAGER

The SoSmart Manager is the interface between the physical optical network and the staff operating the network, and hence the graphical user interface (GUI) plays a crucial role for the efficiency of network provisioning and management. The SoSmart Manager GUI is designed to be straight forward and intuitive to use. Navigation is easy with menus to the left and the workspace to the right of the display. Graphical representations and selectable menu alternatives are used wherever possible.

Optical layer path calculations and wavelength service creation between network nodes as well as Layer 1 transport service creation between Smartoptics transponders are easily done by simple point and click actions. Just select a port in the node where the optical channel shall start and a port in another node where it shall end, give the service a name and you are done. The SoSmart Manager will automatically calculate the path and estimate its performance.

The SoSmart Manager also provides alarm lists and alarm logs to simplify fault-finding and troubleshooting as well as performance monitoring. Furthermore, the SoSmart Manager includes the necessary functions for an efficient administration of the optical network including an up-to-date inventory of the deployed network elements, and keeping track of e.g., mandatory software/firmware upgrades and necessary node element back-up files.

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*Future

Smartoptics ROADM NE's

Smartoptics ROADM NE's

SNMP

CLI

SNMP

CLI NETCONF

SoSmart - Controller

SNMP

CLI

SoSmart - Manager

SoSmart

Planner

Multi-vendor network management system

RESTCONF APIs*

PRODUCTS

SOSMART CONTROLLER

The SoSmart Controller controls the network elements in the optical network enabling the configuration of settings and provisioning of services according to requests coming from the SoSmart Manager GUI and/or from higher-level management systems. The SoSmart Controller is based on the open-source Transport Path Computation Element (TransportPCE) software and uses the non-pro-prietary NetConf and Open ROADM protocols to control the network elements. The communication links to the individual network elements are typically implemented over a secure and dedicated IP-network (DCN) reaching each optical network node.

SOSMART PLANNER

The SoSmart Planner is an optical planning and simulation tool with the same GUI as the SoSmart Manager and using the open-source module GNPy for path simulations. The SoSmart Planner with GNPy is fully capable of doing both advanced OSNR simulations as well as advanced GSNR simulations where non-linear effects are taken into consideration.

The SoSmart Software Suite interworks seamlessly with the DCP network elements, each of them having data models based on Yang and supporting the Open ROADM APIs, which are made accessible via the NetConf protocol.

The image shows an example network in the SoSmart Manager, a part of the SoSmart Software Suite.

19 | Annual Report 2025

PRODUCTS

This open approach has two important advantages: The DCP network elements may be directly controlled by other SDN controllers supporting the Open ROADM API and NetConf, and the SoSmart Software Suite can be extended to also control other optical network elements with relevant open APIs.

OPTICAL DEVICES

Smartoptics offers a comprehensive portfolio of high-end, high quality optical transceivers used for electrical/optical conversion in e.g. routers, switches, and radio base stations. The Smartoptics transceivers support all types of storage, data, voice, and video traffic, regardless of whether it comes to linking rack-to-rack, bottom-to-top of rack, data center-to-data center, or network-to-network with optical fiber.

Building on its system and networking expertise, Smartoptics ensures the availability of the latest transceiver technology at the best price.

Smartoptics 32G, 16G and 8G Fibre Channel transceiver families have been uniquely approved by Cisco for use with its MDS platform. The certified solutions offer Cisco

users a new approach to cost-efficient data center connectivity through IP over DWDM networking. Smartoptics is also the only vendor whose complete end-to-end solutions are layer 1 tested by Brocade. Not just transceivers or multiplexers, but systems that allow intelligent long-distan-ce connectivity based on IP over DWDM principles without the need for stand-alone DWDM platforms.

In addition to the transceivers Smartoptics offers a complete portfolio of passive WDM multiplexors, OADMs, and cables, where applications span from data center interconnect to pure access network deployments for operators. Smartoptics passive multiplexers and OADMs are designed for the best possible performance levels. That translates into low losses and even greater distances for transmission. All Smartoptics units can be housed in case hardened outdoor modules and used outdoors. The range of passive CWDM/DWDM multiplexers and OADM modules allow up to 16 CWDM and 80 DWDM channels to be connected simultaneously over a dark fiber network. These passive components are completely protocol transparent and suit applications including 800/400/100/10G Ethernet, SDH/SONET, 32/16/8/4/2/1G Fibre Channel/FICON, FTTx and CATV.

QSFP-DD transceiver

OSFP 400G transceiver

SFP-DD 100GE transceiver

QSFP28 transceiver

H-Chassi-1RU

20 | Annual Report 2025

PRODUCTS

Through the optical devices portfolio Smartoptics enable enterprises and service providers to leverage advances in pluggable optics in innovative ways, such as deploying IP over DWDM networks, lowering the cost, and creating better scalability for network owners.

PROFESSIONAL SERVICES

Smartoptics provides a wide range of services to its customers, mainly delivered by own inhouse resources. From network design, via staging and installation support to after sales support, Smartoptics ensures that the customer gets the most out of his network. The offering includes pre-defined support service bundles, where the customer can choose a complete set including software update subscriptions with technical support 24/7, advance product replacement, and extended warranty. Alternatively, the customer may pick and choose the individual support services of his interest.

Sales of advanced and complete optical networks to Communication Service Providers and large IXPs does not only depend on the products themselves but also on the support that can be delivered by the vendor when the

network has been deployed. Smartoptics therefore has a dedicated support team handling trouble tickets from all around the globe, 24 hours a day, every day of the year. Response times and customer satisfaction are measured continuously, and we are very pleased that over 90% of our customers state that they are extremely satisfied with the support they receive.

Professional services also play an important role in the Smartoptics growth strategy. The increasing number of customers signing up for Smartoptics' professional services is an important source of recurring revenue for the company. By introducing service bundles such as Complete Care and Smart Care, choosing an adequate service level has been simplified for the customer, resulting in a rapidly growing number of service contracts. The ultimate objective is that every network deal shall be accompanied by a professional service contract extending the customer relation and providing continued income.

21 | Annual Report 2025

PRODUCTS

PROFESSIONAL SERVICES FROM SMARTOPTICS

COMPLETE CARE

The Complete Care service is our most comprehensive service bundle and contains TAC 24/7/365, software subscriptions and APR+EWS.

SMART CARE

The Smart Care offers a bundle of support services including 24/7/365 support and an extended product warranty.

TECHNICAL SUPPORT

Our aim is to meet your network expectations by designing a network to be as high-performance and cost-efficient as possible.

EXTENDED WARRANTY SERVICE

Smartoptics' extended warranty service (EWS) allows you to extend the term of your product warranty beyond the standard term.

ADVANCE PRODUCT REPLACEMENT

Smartoptics' advance product replacement (APR) service is an optional service that can be purchased for any Smartoptics product. If a product is found to be in need of replacement a replacement product with the same or similar functionality will be shipped by the next business day.

NETWORK DESIGN SERVICES

We offer a complimentary optical network design service. This includes a bill of materials (BOM) to match the future-proof fiber and network requirements of every individual network task as well as recommendations for spare parts.

STAGING AND INSTALLATION SUPPORT

Our pre-staging service encompasses building up and testing the network in our lab. This ensures the network is fully operational prior to shipping and saves valuable time during the installation period.

TRAINING AND EDUCATION

Smartoptics offers training programs for everything from xWDM basics to our product portfolio and how to design and implement an optimized network to meet your current and ongoing capacity requirements.

22 | Annual Report 2025

‌BOARD OF DIRECTORS

THOMAS RAMM

SARA HEINER ASPLUND

BORN

1964

BOARD MEMBER SINCE

2013

OTHER CURRENT ASSIGNMENTS

Chair of the Board of Etain AS, Chair of the Board of Apini AS, Owner of Coretech AS

EDUCATION

Bachelor of Information Technology from EDB høyskolen in Oslo, Norway

HOLDINGS IN SMARTOPTICS GROUP

28 883 599 shares, as of 31 December 2025

BORN

1976

BOARD MEMBER SINCE

2022

OTHER CURRENT ASSIGNMENTS

Director of Finance & Accounting at Etraveli Group

EDUCATION

MSc. in Industrial Engineering and Management from the Royal Institute of Technology

HOLDINGS IN SMARTOPTICS GROUP

7 339 shares, as of 31 December 2025

23 | Annual Report 2025

BOARD OF DIRECTORS

KARL THEDÉEN

BORN

1963

BOARD MEMBER SINCE

2019

OTHER CURRENT ASSIGNMENTS

CEO Studsvik AB, Board member of Net Insight AB

EDUCATION

MSc. in Systems Engineering from the Royal Institute of Technology

HOLDINGS IN SMARTOPTICS GROUP

493 078 shares, as of 31 December 2025

EINAR CASPERSEN

BORN

1968

BOARD MEMBER SINCE

2022

OTHER CURRENT ASSIGNMENTS

Lawyer Advokatfirmaet Schjødt

EDUCATION

Cand Jur, Law from University of Oslo

HOLDINGS IN SMARTOPTICS GROUP

14 750 429 shares, as of 31 December 2025

24 | Annual Report 2025

‌MANAGEMENT TEAM

MAGNUS GRENFELDT

STEFAN KARLSSON

BORN

1969

EXPERIENCE

Has held several management, sales and business development positions at Transmode, Infinera, ADVA Optical Networking, Sycamore Networks and Ericsson.

EDUCATION

MSc. Materials Physics from Uppsala University

JOINED SMARTOPTICS

2016

HOLDINGS IN SMARTOPTICS GROUP

1 257 489 shares as of 31 December 2025

BORN

1970

EXPERIENCE

Prior to joining Smartoptics, he held the position as Director of Finance and Accounting at Trustly since November 2020. Previously, he was the Director of Finance at Infinera. His background also includes positions in financial controlling and accounting at Transmode, PacketFront, Powerwave Technologies, Allgon and IconMedialab, as well as a tenure as an auditor at PWC.

EDUCATION

Bachelor degree in Business and Economics from Stockholm University and has studied Business Administration at the University of Macau.

JOINED SMARTOPTICS

2024

HOLDINGS IN SMARTOPTICS GROUP

5 000 shares as of 31 December 2025

25 | Annual Report 2025

MANAGEMENT TEAM

KENT LIDSTRÖM

BJÖRN ANDERSSON

BORN

1969

EXPERIENCE

Has held various positions at Transmode and Infinera including a 4-year assignment in the USA where he worked as the director of sales engineering. Prior to this Kent held several positions at Ericsson.

EDUCATION

BSc. In Engineering from the Royal Institute of Technology

JOINED SMARTOPTICS

2018

HOLDINGS IN SMARTOPTICS GROUP

180 075 shares as of 31 December 2025

BORN

1971

EXPERIENCE

Over 25 years of experience in the optical networking industry. Prior to joining Smartoptics, he has held several product, sales, management and business development positions at Infinera, Transmode, Lumentis, Ericsson and Sycamore Networks. Including multiyear expat assignments in Italy and USA.

EDUCATION

Bachelor of science in Software/Electronic Engineering. Specializing in Data communication and Distributed Systems.

JOINED SMARTOPTICS

2024

HOLDINGS IN SMARTOPTICS GROUP

8 000 shares, as of 31 December 2025

26 | Annual Report 2025

MANAGEMENT TEAM

RONALD HÜBSCH

PER BURMAN

BORN

1973

EXPERIENCE

More than 20 years of experience from the optical telecommunication industry. He has held several positions in procurement, sales and production engineering at Coriant, Infinera, Nokia Siemens Networks, Siemens and Taclink.

EDUCATION

Dipl.-Ing. Electrical Engineering - RF Technology and Photonics from Technical University, Berlin

JOINED SMARTOPTICS

2021

HOLDINGS IN SMARTOPTICS GROUP

5 500 shares as of 31 December 2025

BORN

1976

EXPERIENCE

Per has held several sales and management positions at Tilgin, Transmode and Infinera.

EDUCATION

MSc. In Engineering from the Royal Institute of Technology

JOINED SMARTOPTICS

2017

HOLDINGS IN SMARTOPTICS GROUP

180 075 shares as of 31 December 2025

27 | Annual Report 2025

MANAGEMENT TEAM

ANDREAS PERSSON

BORN

1983

EXPERIENCE

Over 15 years of experience in R&D management, with 10 of those years focused on the telecom and IT infrastructure industry. Prior to joining Smartoptics, he held key roles at Transmode/Infinera between 2009 and 2017, and at PacketFront from 2017 to 2019. He brings deep technical expertise combined with leadership experience in developing and delivering innovative infrastructure solutions.

EDUCATION

Master of Science degree in Engineering Physics from the Royal Institute of Technology and a Master of Business Administration from Blekinge Institute of Technology.

JOINED SMARTOPTICS

2025

HOLDINGS IN SMARTOPTICS GROUP

15 000 shares as of 31 December 2025

28 | Annual Report 2025

‌BOARD OF DIRECTORS REPORT

THE SMARTOPTICS GROUP

Smartoptics Group ASA is the holding company of the Smartoptics group of companies ("the group" or "Smar-toptics"). The group consists of Smartoptics Group ASA and three subsidiaries (Smartoptics AS, Smartoptics Sveri-ge AB and Smartoptics US Corp).

Smartoptics is a Scandinavian company that provides innovative optical networking solutions and devices for the new era of open networking.

The group's focus is on solving network challenges and increasing the customers efficiency by having an open network approach. This allows customers to break unwanted vendor lock ins, remain flexible and reduce costs. Smartoptics products are based on in-house developed hardware and software, enhanced through associated services.

The customer base includes thousands of enterprises, governments, cloud providers, Internet exchanges as well as cable and telecom operators.

Smartoptics partners with leading technology and network solution providers and upholds numerous certifications and approvals from major switching and storage solution providers such as Brocade, Cisco, and Dell. Smartoptics has a global reach through the sales force and almost 200 business partners including distributors, OEMs and VARs.

OPERATIONAL OVERVIEW

PRODUCTS

Smartoptics has three main product categories.

Solutions comprises software and hardware systems which enable transport of data over optical fibers in networks and between data centers. Smartoptics' product offering is designed to target the metro and regional market. Target customers may be enterprises, Internet content providers or communication service providers.

Devices consists of passive optical multiplexers, transceivers (optical interfaces for routers, switches and base-sta-tions for example) and various accessories. Optical transceivers are complete pluggable optical interfaces for any

host system, ranging from simple fiber to the home termination points to high end routers, switches and base stations. Smartoptics offers a complete portfolio that can be used in a wide range of host systems. Smartoptics offers optical transceivers capable of transmitting and receiving from 100 Mbit/s to 400 Gbit/s.

Software & Services consists of technical support, advanced product replacement, extended warranty and software upgrades. Software & Services is usually sold together with the other types of products.

LOCATIONS

The employees of the group are located in Norway, Sweden, United Kingdom, Germany, Poland, the Netherlands and the United States. Smartoptics Group ASA operates from Brynsalléen 2, 0667 Oslo. The Group also has presence in Japan, Mexico and Malaysia.

FINANCIAL REVIEW

FINANCIAL RESULTS OF 2025

Smartoptics revenues amounted to USD 75.3 (55.5) million in 2025, an increase of 35.6% from 2024. The increase is driven by an increasing underlying demand in the market, especially in the Americas.

Revenue in the Americas increased by 70.9% to USD 44.3 (25.9) million. Revenue in EMEA increased by 1.2% to USD

25.0 (24.7) million. In APAC revenue increased by 22.2% to USD 6.0 (4.9) million.

Revenue split by business area for the year was Solutions 59.0% (56.8%), Devices 25.9% (28.0%) and Software

& Services 15.1% (15.2%).

Gross profit amounted to USD 36.0 (26.7) million, corresponding to a gross margin of 47.8%, compared to 48.1% in the previous year. The gross margin remains high and stable.

Operating expenses amounted to USD 65.5 (49.9) million, reflecting an increase driven primarily by higher revenues and continued organizational expansion. At year-end 2025, Smartoptics had 143 employees, compared to 132 at the end of the previous year. The increase in operating expenses was also partly attributable to the strengthening of the USD against SEK and NOK. Net employee bene-

29 | Annual Report 2025

BOARD OF DIRECTORS REPORT

fit expenses increased by 27.6% to USD 18.9 (14.8) million and represented 25.1% of total revenue, compared to 26.7% in the prior year.

Operating profit amounted to USD 6.8 (3.3) million, corresponding to an operating margin of 9.0%, compared to 5.9% in the previous year. The improvement was driven by strong revenue growth that exceeded the increase in operating expenses. This development occurred despite continued strategic investments in product development and market expansion, while the gross margin remained stable.

Amortization amounted to USD 0.6 (0.3) million. It primarily relates to capitalized development, as well as other intangible assets such as software systems. Capitalized development additions for the year amounted to USD 0.9 (0.8) million.

Depreciation amounted to USD 2.4 (2.0) million and is primarily related to production equipment and lab instruments used for development, office equipment and righ-t-of-use assets.

Net financial items amounted to USD -0.8 (2.1) million. Interest expenses were USD -0.2 (-0.3) million and interest income amounted to USD 0.2 (0.3) million. Net foreign exchange differences totaled USD -0.9 (2.1) million, mainly related to the revaluation of cash, trade receivables and trade payables, and were negatively impacted by the strengthening of the USD against SEK and NOK.

Profit/(loss) for the year was USD 4.7 (4.0) million.

The parent company operates as a holding company, and all operational activities are conducted in the subsidiaries. The net income for the parent company was NOK 25.3 (USD 2.5) million.

In the 2024 annual report, the Group communicated an ambition to reach USD 100 million in revenue by 2025/2026. The revenue development in 2025 is considered to be in line with this ambition, reflecting continued growth and underlying market demand.

FINANCIAL POSITION AND CASH FLOW

Total non-current assets amounted to USD 9.1 (7.1) million at the end of 2025. This mainly consists of right-of-use assets of USD 0.6 (1.2) million, property, plant and equipment of USD 3.7 (3.0) million, capitalized development of USD

2.2 (1.6) million as well as deferred tax assets of USD 1.9 (1.0) million.

Total current assets amounted to USD 47.0 (41.8) million at the end of 2025. Current assets consist predominantly of inventory, trade receivables and cash. Cash position was USD 7.3 (8.0) million at year end.

The group had a total equity of USD 30.3 (28.5) million, corresponding to an equity ratio of 54.1% (58.2)% at the end of the year.

Total liabilities amounted to USD 25.9 (20.5) million at the end of the year. Current liabilities were USD 19.9 (14.7) million and non-current liabilities was USD 5.9 (5.8) million. The group had USD 0.3 (0.8) million in interest bearing debt. Current liabilities consist of mainly trade payables of USD 5.6 (5.0) million and deferred revenue of USD 7.2 (4.0) million. Deferred revenue relates to pre-paid service business, where revenue recognition is made as the performance obligation of the service is fulfilled and the deferred revenue is transformed to revenue.

Operating cash flow was positive, USD 8.5 (6.4) million. This was driven by overall profitable business.

RISK FACTORS

COMMERCIAL RISK

Smartoptics operates in a highly competitive market. Key success factors include product performance, network architecture, solution design capabilities, adherence to industry standards, pricing, and the ability to deliver on time. Increased competition in certain segments may affect Smartoptics competitive position and attractiveness to customers.

GEOPOLITICAL RISK

Smartoptics rely on a global supply chain with suppliers located in Europe, North America and Asia. Escalating geopolitical tensions, particularly between major global powers, could pose risks to supply chain stability and operational continuity.

CUSTOMER CREDIT RISK

Customer credit risk is actively managed and continuously monitored. All customers are subject to credit evaluations, or the use of prepayment. Historically, the Group has experienced very low levels of bad debt, and credit risk is expected to remain minimal going forward.

LIQUIDITY RISK

The Group's financial position is strong with USD 7.3 million in cash at the end of the year. In addition, the Group has an undrawn bank credit facility of USD 7.4 million, providing ample liquidity.

30 | Annual Report 2025

BOARD OF DIRECTORS REPORT

INTEREST RATE RISK

As of year-end 2025, total borrowings amounted to USD

0.3 million. The Group has two loans with Innovasjon Nor-ge and one with Nordea Financing, all denominated in NOK and set to be fully repaid by 2026. There are no other interest-bearing liabilities.

EXCHANGE RATE RISK

Smartoptics' customer base is primarily located in Europe, the USA, and Canada. The vast majority of commercial contracts-with both customers and suppliers-are denominated in USD. However, operating expenses, particularly salaries, are paid in local currencies such as SEK, NOK, USD, EUR, and GBP. Consequently, currency fluctuations may impact profitability through changes in operating costs.

FINANCIAL RISK

Financial risks are monitored continuously, and the Group seeks to limit exposure through customer credit evaluations, maintaining liquidity reserves and credit facilities, and ongoing follow-up of currency and interest rate exposure.

DEPENDENCY ON KEY PERSONNEL

Employees are among Smartoptics' most critical assets. Their expertise, experience, and professional networks are not easily replaced. As the Group continues to grow, Smartoptics is increasingly recognized as an attractive employer, enhancing its ability to recruit top talent across various markets. Employee turnover has remained consistently low in recent years.

ESG

The Group also considers sustainability and climate-rela-ted risks as part of its overall risk management framework, including potential impacts from regulatory developments, supply chain disruptions, and changing customer requirements related to environmental and social standards.

WORKING ENVIRONMENT AND EMPLOYEES

At the end of the financial year, the Group had 143 employees, of whom 115 were men and 28 were women. The parent company had 2 employees, both men. The Board of Directors consists of four members, of whom one is female. No injuries or accidents were reported during the financial year, and the level of sick leave remained low.

The Group promotes equality, diversity and inclusion and has implemented policies covering non-discrimina-tion, equal opportunities, and employee well-being. Employment decisions related to recruitment, promotion, and compensation are based on merit, and grievance

mechanisms are in place to ensure that concerns can be raised confidentially and addressed appropriately.

The Group is committed to providing a safe and inclusive working environment. Operations are supported by a certified occupational health and safety management system (ISO 45001), with regular audits and continuous improvement initiatives. No lost-time injuries were recorded during the year. Gender distribution and diversity metrics are monitored across all organizational levels.

ENVIRONMENT, SOCIAL & GOVERNANCE

Smartoptics integrates sustainability into its strategy, governance, and operational practices to support responsible growth and long-term value creation. As a global provider of optical networking solutions, the company recognizes the importance of balancing technological innovation with environmental responsibility, ethical business conduct, and strong stakeholder relationships.

ENVIRONMENTAL RESPONSIBILITY

Smartoptics works continuously to understand and reduce its environmental footprint across its operations and value chain. The company conducts greenhouse gas (GHG) inventories in accordance with the GHG Protocol and ESRS requirements, covering Scope 1, Scope 2, and Scope 3 emissions.

Operational emissions remain limited. Scope 1 emissions remain at zero, and Scope 2 emissions remain low due to the use of renewable electricity at operational locations in Oslo and Stockholm. The majority of emissions originate from the value chain, particularly from transportation, logistics, and supplier-related activities.

During the reporting year, Smartoptics further improved the quality and transparency of Scope 3 emissions data by strengthening collaboration with logistics partners and improving data collection processes. Key climate-related actions include renewable electricity sourcing, improved emissions tracking, the introduction of Sustainable Aviation Fuel in selected freight operations, and ongoing engagement with suppliers to improve value chain transparency and emissions management.

The company also continues to strengthen circular economy practices. Waste sorting and recycling processes have been improved, resulting in increased recycling rates and reduced residual waste. These measures support the company's efforts to improve resource efficiency and environmental performance.

31 | Annual Report 2025

BOARD OF DIRECTORS REPORT

SOCIAL RESPONSIBILITY

Smartoptics is committed to providing a safe, inclusive, and supportive workplace for all employees. The company maintains a certified occupational health and safety management system under ISO 45001, supporting structured risk management, preventive safety measures, and continuous monitoring of workplace conditions.

Employee well-being and engagement remain important priorities. Smartoptics maintained its Great Place to Work certification during the reporting year and was recognized among Sweden's Top 25 workplaces in the IT sector. These recognitions reflect strong employee trust, engagement, and workplace culture.

Responsible supply chain management also remains a key focus area. Smartoptics applies supplier qualification processes, risk-based assessments, and ongoing engagement with suppliers to ensure alignment with expectations related to labor rights, ethical conduct, and environmental responsibility. Responsible sourcing initiatives also address issues such as conflict minerals and human rights across the supply chain.

Customer satisfaction remains central to Smartoptics' operations. The company maintains structured processes for customer engagement, technical support, and operational coordination throughout the product lifecycle. Customer satisfaction continues to be monitored through regular feedback mechanisms, including annual surveys and Net Promoter Score measurements.

GOVERNANCE AND RESPONSIBLE BUSINESS CONDUCT

Strong governance and ethical business conduct form the foundation of Smartoptics' sustainability approach. The Board of Directors oversees the company's strategic direction, risk management framework, and sustainability performance, while the management team is responsible for implementing sustainability initiatives and integrating ESG considerations into operational decision-making.

Smartoptics operates certified management systems under ISO 9001 for quality management, ISO 14001 for environmental management, and ISO 45001 for occupational health and safety. Recertification was successful during 2025. These systems support structured governance, regulatory compliance, and continuous improvement across the organization.

The company also continues to strengthen its information security framework and has initiated its journey toward ISO 27001 certification to further enhance cybersecurity governance and the protection of company and customer data.

Ethical business conduct is supported by a comprehensive governance framework that includes the Code of

Conduct, anti-corruption and anti-bribery policies, sanctions compliance procedures, and a confidential whistle-blowing mechanism. These policies support transparency, accountability, and responsible business behavior across the organization and its value chain.

Smartoptics maintains robust procedures to ensure compliance with international sanctions regulations, export control requirements, and anti-money laundering principles. Where potential risks are identified, escalation procedures and internal review processes are applied to ensure that appropriate actions are taken in line with regulatory requirements and company policies. Through these measures, Smartoptics aims to mitigate compliance risks, maintain adherence to international trade regulations, and ensure that its operations are conducted in accordance with applicable legal and ethical standards.

In accordance with the Norwegian Transparency Act, we conduct due diligence assessments based on OECD guidelines, ensuring responsible business conduct throughout our supply chain. Our assessment is available on our website at https://www.smartoptics.com. Our sustainability report inspired by the CSRD directive and ESRS standard, will be published by 30.06.2026 at https://www.smartoptics.com, where previous years' report also is available, demonstrating our commitment to transparency and responsible corporate practices.

ESG OUTLOOK

Smartoptics continues to strengthen its sustainability governance and reporting in line with the Corporate Sustainability Reporting Directive and the European Sustainability Reporting Standards. The company's sustainability strategy is guided by a double materiality assessment that identifies and prioritizes key environmental, social, and governance topics.

Looking ahead, Smartoptics will continue focusing on improving emissions transparency, strengthening supplier engagement, enhancing governance processes, and supporting a safe and inclusive workplace. These efforts support responsible growth while enabling the delivery of reliable connectivity solutions that contribute to digital infrastructure development worldwide.

GREAT PLACE TO WORK

Our employees are our biggest asset and we want to offer a workplace where they can make an impact. That is why we conduct an employee survey annually. After the third year in a row, we have received the Great Place certificate, which is a great honor

32 | Annual Report 2025

BOARD OF DIRECTORS REPORT

INSURANCE FOR BOARD MEMBERS

The group maintains liability insurance for the members of the board against liabilities that may arise from the performance of normal duties as board members. The limit of liability is NOK 10 million for each claim and per year.

GOING CONCERN

The Board of Directors and the management confirm that the going concern assumption has been applied in preparing the annual accounts and that this assumption is realistic. The group has enjoyed a strong revenue growth over the past five years and has seen a steadily increasing profitability during the same period. The group's equity position and business momentum cater for favorable development over the coming years.

ALLOCATION OF NET INCOME

The Board of Directors has proposed to allocate the net income of NOK 58.8 million to dividend, equal to NOK

0.60 per share.

OUTLOOK

For the period 2026-2030, the Group has a target to increase the market share within relevant markets by two to three times. With the scalable business model and further efficiency improvements, the Group targets an operating margin in the range of 13-16 percent. The Group's outlook is subject to uncertainty related to market conditions, supply chain factors and macroeconomic developments.

33 | Annual Report 2025

BOARD OF DIRECTORS REPORT

THE SMARTOPTICS SHARE

INDEXED DEVELOPMENT

175

155

135

115

95

Smartoptics Group ASA Euronext Growth All-Share Index Oslo Børs All-share Index

75

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

At the end of 2025 Smartoptics Group ASA had 98 045 518 shares issued. Smartoptics Group ASA uplisted from Euronext Growth Oslo to Euronext Oslo Børs main market, having the first day of trading 26 August 2025.

Closing price for the Smartoptics share on 30 December 2024 was 18.00 NOK. Closing price for the Smartoptics share on 30 December 2025 was 29.50 NOK.

The Smartoptics share is a part of Oslo Børs All-share Index. This index increased by 18.03% during 2025. The Smartoptics share price increased by 63.89% during 2025.

9 April 2026 Oslo, Norway

Thomas Ramm Chairman of the Board

Sara Heiner Asplund Board member

Karl Thedéen Board member

Magnus Grenfeldt Chief Executive Officer

34 | Annual Report 2025

CORPORATE GOVERNANCE REPORT

CORPORATE GOVERNANCE REPORT

The company became subject to the Norwegian Code of Practice for Corporate Governance (NUES) upon listing on Oslo Børs on 28 August 2025. the Oslo Stock Exchange Rulebook II - Issuer Rules, and the Norwegian Accounting Act. The company has implemented governance structures to comply with the Code from that time.

IMPLEMENTATION OF CORPORATE GOVERNANCE

Smartoptics is committed to maintaining high standards of corporate governance to support sustainable value creation and stakeholder trust. The Company aligns its practices with the UN Global Compact principles on human rights, labour, environment and anti-corruption.

DEVIATIONS FROM THE CODE OF PRACTICE

The Company's Corporate Governance Policy is, with one exception, in compliance with NUES. The deviation concerns the composition of the nomination committee, where members of the Board of Directors may serve. This differs from NUES recommendations but is considered appropriate given the Company's ownership structure and the need for relevant competence in the nomination process.

BUSINESS

Smartoptics develops and delivers optical networking solutions. The Board defines the Company's objectives, strategy and risk profile to ensure long-term, sustainable value creation, and reviews these at least annually. More details on Smartoptics' objectives, strategies and risk profiles are presented in the Board of Directors' Report and on the Company's website.

EQUITY AND DIVIDENDS

The Board ensures that the Company maintains a capital structure appropriate to its objectives, strategy and risk profile. The Company aims for a stable to growing dividend, subject to financial performance, investment needs and financial position.

At the annual general meeting held on 8 May 2025, the Board was authorised to increase the share capital and to acquire treasury shares. The authorisations are limited to specific purposes, including financing of investments, acquisitions and incentive programmes, and are valid until the annual general meeting in 2026, however no later than 30 June 2026.

EQUAL TREATMENT OF SHAREHOLDERS

The Company has one class of shares, all carrying equal rights. Shareholders are treated equally, and any deviation from pre-emptive rights is justified and disclosed. Transactions in own shares are conducted on market terms.

SHARES AND NEGOTIABILITY

The shares are freely transferable, with no restrictions beyond those imposed by law.

GENERAL MEETINGS

The general meeting is the Company's highest authority. Notices are distributed at least 21 days in advance and include sufficient information to enable shareholders to assess all matters. Shareholders may participate electronically and vote in advance where applicable. Voting is facilitated on each individual agenda item, including by proxy.

NOMINATION COMMITTEE

The Company has a nomination committee in accordance with its articles of association.

The nomination committee is responsible for proposing candidates for election to the Board of Directors and recommending remuneration for Board members. In its work, the committee considers the Company's needs for competence, capacity, diversity and independence, and engages with shareholders, the Board and management as appropriate.

BOARD OF DIRECTORS

The Board is elected by shareholders and composed to ensure appropriate expertise, capacity, diversity and independence. Members are elected for up to two years and may be re-elected. The Board complies with applicable gender representation requirements, including that at least 40% of each gender is represented. The majority of the Board members are independent of the Company's executive management, material business relationships and significant shareholders.

The Board is responsible for the Company's strategy, oversight and governance. It adopts an annual work plan, regularly reviews performance and development, and conducts an annual self-evaluation. Conflicts of interest must be disclosed.

35 | Annual Report 2025

CORPORATE GOVERNANCE REPORT

The Board has established an audit committee and a remuneration committee to support its work.

BOARD MEETINGS AND ATTENDANCE

During 2025, the Board of Directors held 9 meetings, with

a continued focus on strategy, financial performance, risk management and key operational matters.

Board and committee attendance in 2025:

*Einar Caspersen was elected Deputy Board Member at the extraordinary general meeting on the 23 May 2025, with effective date 20 August 2025, prior to this his role was Board Member.

AUDIT COMMITTEE

The audit committee consists of Thomas Ramm and Sara Heiner Asplund.

The audit committee held 1 meeting during 2025 and focused on financial reporting, internal control, risk management and interaction with the external auditor. At least one member has competence in accounting and/or auditing.

REMUNERATION COMMITTEE

The remuneration committee consists of Thomas Ramm and Karl Thedéen. One meeting was held in the remuneration committee during 2025.

RISK MANAGEMENT AND INTERNAL CONTROL

The Board ensures that the Company has effective systems for risk management and internal control appropriate to its operations. The framework includes control environment, risk assessment, control activities, information and communication, and follow-up.

The Board of Directors oversees the risk management process. Further information on key risks is provided in the "Risk factors" section of the Board of Directors' report.

The Company's internal control over financial reporting includes monthly reporting prepared by the finance team and reviewed by the CEO and the Board. Key balance sheet items are reconciled, and financial results are compared with budgets and forecasts to ensure reliable reporting. The quarterly and annual financial reports are subject to review and approval by the Board.

The Board performs an annual review of key risks and internal control systems.

REMUNERATION OF THE BOARD

Board remuneration is determined annually by the general meeting and reflects responsibilities, expertise and workload. It is not performance-based, and share options are not granted.

REMUNERATION OF EXECUTIVE PERSONNEL

The Board establishes a remuneration policy for executive management, approved by the general meeting and reviewed at least every four years. Performance-based remuneration is subject to defined limits.

The Company prepares an annual remuneration report, which is subject to an advisory vote by the general meeting.

INFORMATION AND COMMUNICATION

The Company emphasises transparent, timely and equal communication with the market. Financial reporting is prepared in accordance with IFRS and published quarterly.

Authorised spokespersons include the CEO and CFO. The Company maintains procedures to ensure consistent communication, including contingency planning.

TAKE-OVERS

In the event of a takeover bid, the Board will ensure equal treatment of shareholders and that shareholders are provided with sufficient information to assess the offer. The Board will not obstruct takeover bids unless there are valid reasons for doing so.

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CORPORATE GOVERNANCE REPORT

AUDITOR

PricewaterhouseCoopers AS has served as the Company's external auditor since 2021. The auditor presents to the audit committee an evaluation of risk, internal control, quality of reporting, and the audit plan for the current year, and participates in the Board's review of the annual financial statements.

The auditor is independent of the Company. Non-audit services are limited to those naturally related to the audit, such as technical assistance with tax returns and financial reporting. All other services provided by the auditor are subject to approval by the audit committee.

RELATED PARTY TRANSACTIONS

Transactions with related parties are conducted on arm's length terms and in accordance with applicable regulations. Where relevant, such transactions are subject to Board approval and, as a main principle, supported by independent valuation.

INSIDE INFORMATION

The Company has established procedures for handling inside information in accordance with the Market Abuse Regulation (MAR), including insider lists, disclosure obligations and trading restrictions.

37 | Annual Report 2025

‌FINANCIAL STATEMENTS FOR THE GROUP

Employee benefit expenses 4 -18 874 -14 795

Depreciation 10, 11 -2 372 -1 975

Financial expenses 6 -123 -310

Total comprehensive income is attributable to:

Owners of the parent company 7 469 746

39 | Annual Report 2025

40 | Annual Report 2025