Sleep Cycle — Call Transcript 2025

Okay. Hi, everyone. Unfortunately, we had some technical challenges here on the call, but we are live now and we're ready to go. Apologies for the wait. Good morning as well, and thank you for joining us at Sleep Cycle's Quarter Three 2025 interim report presentation. I'm Erik Jivmark. I'm the CEO of Sleep Cycle. I'm here together with our CFO and Head of Investor Relations, Elisabeth Hedman. In this call, we will walk you through the key highlights from the quarter and our progress on the strategic initiatives and also an update on our financials. Together, we will also address any questions you might have in the Q&A at the end. We're Sleep Cycle. We're the world's leading sleep technology company. We have a mission to improve global health by helping people to take control of their sleep. Everything we do aims to turn high-quality sleep into an accessible daily habit at scale. We're used and loved by millions, and we're available in more than 180 markets, in app stores, and as part of many wearables. Today, we're proud to be the world's number one sleep app. We're helping people to build healthy sleep habits, something that is more needed than ever. What sets us apart goes far beyond that. At the core of everything we do is our proprietary AI sound model. This technology not only powers the app millions of users rely on each night, it also creates one of the world's richest health data streams. With the help of this, we're entering a new phase. It's not a new strategy. It's a new execution model for that strategy. We call it Powered by Sleep Cycle. During Quarter Three, we presented our Sleep SDK, opening up access to this technology. Partners across wellness, healthcare, wearables, and beyond can now integrate our capabilities directly into their own platforms. To me, this is an extension of our successful partnership strategy. We're creating new high-margin revenue opportunities, reaching an audience outside our own app. Our strategy is clear: continue growing our consumer business while expanding the value of our platform. On one hand, that means strengthening user acquisition, engagement, and retention. On the other, we're building new monetization paths, especially around data, technology, and medtech with sleep apnea screening. This dual focus allows us to scale both our reach and our impact. Throughout the year, we've been very transparent about the fact that the sleep tracking segments have headwinds in the App Store. However, as you can see at the chart with data from SensorTower, we're performing relatively better than the entire health and fitness app segment. We're taking market shares in both downloads and revenue. Sleep apps are part of health and fitness. However, when we group together and compare with our direct competitors, our performance looks even better. We show resilience, and we do that leading with product innovation and a stronger business acumen across the organization. Speaking of product development, in Quarter Three, we shipped the liquid glass design alongside iOS 26, making navigation clearer and highlighting premium value. We prepared the first AI sleep coach, planned to be released in Quarter Four, to make the app more proactive, personalized, and habit-forming. Smart alarm refinements continue to improve perceived wake-up quality and also help our engagement. We also increased new sales price with around 10% in key markets. Because revenue is recognized over 12 months, we reported ARPU lags, but the pricing supports ARPU in the long run. If we look at new sales for September isolated, ARPU was CHF 296. But adjusted for FX, it was CHF 318. We have continued to raise prices in October. Currently, in the U.S., which is our largest market, new sales ARPU is close to CHF 500 now in October. It's up 25% since July. This means that we are improving top-line performance over time, and it's also helping us in pricing the product right with future partners. When it comes to partners, things are going very well. They continue to grow, up 55% year-over-year and 13% quarter over quarter. Partnerships now stand for 11% of total revenue. To me, partnerships is about reaching new customers without any additional acquisition cost. It's also about taking control of our own destiny, relying less on storefronts, creating a more diversified and resilient revenue base, and a deeper presence in the wider health ecosystem. I am expecting the app partnerships to continue to grow also in Quarter Four. That's not all. During Quarter Three, we also took another major leap. With our Powered by Sleep SDK, partners can integrate our world-leading AI sleep analysis into their products. It's contactless, it's real-time, and it's built on years of machine learning. Commercially, this opens up a new recurring licensing model, and it also accelerates how we scale our mission beyond our own app. During Quarter Three, the focus was to release the SDK for us to move from theoretic discussions with partners into more tangible dialogues, where we are now in Quarter Four looking for partners that want to pilot this and enhance their core experience. We are in the beginning of our journey, but I'm very excited about the possibilities ahead. We don't stop with the SDK for other companies to license. We are also looking to use our own technology in new ways. As part of this, we have sleep apnea, which affects over 950 million people worldwide. Yet, 80% remain undiagnosed. It's exposing them to significantly higher risks of heart disease, stroke, and diabetes. Traditional diagnostics are costly and quite inaccessible. That's where Sleep Cycle comes in. We're using our proprietary audio-based AI, already trusted by millions nightly, to enable non-invasive smartphone-based apnea screening. No wearables, no cables, no clinic visits. AI-powered screening using only the iPhone microphone. Medical-grade precision with consumer-grade simplicity. It's such a natural extension of our platform, and it's aligned with our mission to improve global health. Importantly, it reflects the shift toward proactive, personalized healthcare. Our sleep apnea initiative represents one of the most significant growth opportunities for Sleep Cycle. The clinical study we launched in June is now about 20% complete, which marks an important step toward medical certification. As the study progresses, we're also working in parallel on documentation audits and commercial optimization. The goal is to be ready for submission to both FDA and then a European notified body toward the end of next year, 2026. Longer term, this initiative opens two strategic revenue paths: new consumer offerings within the app and future health tech licensing opportunities with partners in the healthcare ecosystem. With that, I will hand over to Elisabeth Hedman that will walk us through the financial performance for the quarter. Thank you, Erik. Let's move on to the financials. The number of paying subscribers ended at 832,000, down 9% from last year, reflecting the softer development of the segment. ARPU was CHF 271 or CHF 276 when adjusted for FX effects. It's slightly lower than last year. We have raised the prices, and the price adjustments we implemented during the quarter will gradually support ARPU over time, though the reported metric lags due to recognition of revenue, and most of our subscriptions are 12 months. We continue with testing new price points on different markets to improve the long-term value per customer. Net sales for the quarter amounted to CHF 62 million, which is a decrease of 6.6% year-over-year or 4.7% FX adjusted. EBIT for the quarter was CHF 17 million, a margin of 27.3%. Let's take a look at the subscriber and revenue development. The number of paying subscribers, as I said, 832,000, mainly due to a lower intake of new customers and our focus on improving ARPU and long-term value per user rather than pure volume growth. The retention among existing users remains stable, which shows the strength of the core product and user engagement. Net sales decreased by 6.6% or 4.7% FX adjusted. The main drivers were lower new customer sales and continued FX pressure, while reported ARPU lags the impact of the recent price increases. Importantly, partnership revenue continues to grow strongly. It's up 55% year-over-year and now accounts for 11% of our total revenue. This confirms that our diversification efforts are working and that partner demand for our brand and technology remains strong. If we move to profitability, you'll see that margins remain solid despite the softer top line. EBIT for the quarter came in at CHF 7 million, which corresponds to 27.3% to be compared with 31.3% a year ago. There have been no non-recurring items during this year. Despite the lower revenue top line, we do maintain the high margin for this quarter. The decrease in EBIT compared to last year is mainly explained by lower revenue and FX impact, while costs are well controlled. Distribution costs were lower due to reduced App Store commission as a result of less new sales. External costs were somewhat higher, linked to continued growth-related initiatives. Staff costs were stable with a slight increase in headcount compared to last year. The cash flow from operations was CHF 5.5 million. Liquidity remained strong at CHF 114 million at the end of the quarter. We did capitalize CHF 2.6 million related to sleep apnea screening and Sleep Cycle SDK during the quarter. For the nine-month period, net sales was CHF 190 million, down 2.4% year-over-year or 1.3% FX adjusted. EBIT reached CHF 52 million. The number for last year was impacted by non-recurring items related to reorganization, mainly within staff costs. The EBIT margin for the period should be compared to 31.4% last year. As I said, for the quarter, external costs are slightly higher, reflecting growth-related activities, while depreciation decreased as the lease for the former Stockholm office is no longer in the base. Our cash generation continues to be strong. We had an operating cash flow for the full period of CHF 42 million. We did distribute CHF 61 million in dividends during Q2. We have capitalized CHF 9.3 million for the period, mainly related to the sleep apnea screening. Overall, this demonstrates a resilient business model with stable profitability and healthy balance sheets. Now over to you, Erik, to summarize the quarter. Thank you, Elisabeth. Q3 has been a very intense quarter. We are continuing our transformation. We are taking control of our own destiny with diversifying revenue streams and also expanding our core product into new areas, such as AI coaching. We do that while actively taking steps to protect our top line with price increases in key markets. Also, the Powered by Sleep SDK is launched, meaning that we can now move discussions from PowerPoint to reality. We're looking for pilot customers in the fourth quarter for our tech licensing initiative. Secondly, the sleep apnea screening solution study is progressing toward certification. We're now at a 20% completion rate in our clinical trials. Compared to other studies, we're moving fast, and the team is doing a great job with this. Earlier bets, such as our focus on partnerships, are paying off. We're up 55% year-over-year, and partnerships are now 11% of our revenue. That's why we will continue and double down on it going forward. Together, these steps prepare the company for growth beyond the App Store. We have a clear strategy in place. We have a motivated and talented team. Together, we're building a more resilient Sleep Cycle for the future. With that, we're opening up for any questions you might have. We have a question from Johan Boström, who asks if we will start reporting partnership revenue going forward quarterly. Yes, we do report this since Q2, and we plan to continue doing this. We have a question here from Gustav. You say that you're still number one. Which competitors do you compare with? In the U.S., if the U.S. is your largest market, you are ranked 102, but you have several sleep tracking apps yielding higher ARR in the top 20 lists. What is the basis for your number one claim? We are, over time, the largest sleep app. I think the number you're looking at or referring to is probably a category ranking in the App Store. As I shared, the data from SensorTower, which is the official data that we refer to, we can see that we take both market share and also revenue in the segment. That is what's supporting the claim. Another question regarding the SDK program. That is an exciting one, but I'm hesitant on user adoption due to the partner app requiring the user to have the app open while sleeping since you analyze sleep through sound. How do you tackle that? How many partners have onboarded into the SDK program? The SDK was just launched, 20 days ago or so. What I see in the discussions that we have is that we actually have quite a lot of partners that either today is a wearable where sound is something that would complement their offering and allow them to do things that they cannot do today. It could also be things that are non-wearable. It could be IoT-related stuff where sound is a natural part of how the consumer interacts with the product. We also saw interest from companies today where they would like to have the SDK as part of their app experience, where they would then need to have the customer have the app active during the night. They see that there is an interest in doing so, given what they can give back to the customer in terms of data and experience. As I said previously, this quarter, I hope that we can sign some pilot customers and get going and moving from the discussions that we have into reality. I hope we can talk more about that next time. We have a couple of questions regarding the dynamics between price increases and subs development, what we can expect going forward, and if the price increases could have affected the growth in subs in Q3. The segment is what the segment is when it comes to growth. That’s why we want to be transparent about that. What we do now with price is that we're doing these changes in a very precise manner. We're basically dividing the markets in different cohorts with different prices. We monitor that for a while, and then we pick the one that optimizes revenue the most or sales. Of course, we're also keeping an eye on how it impacts subscribers. I think that answers that question. The other one was if the price increase could put you back to growth already in Quarter Four. I would say, given how the segment is developing so far in the quarter and also the delay we have with the 12-month subs that we're selling, I think it's too early to say and not something I want to speculate into. We have a question regarding the sleep apnea study. If it proves successful and we move into commercialization, what would be considered a realistic scenario for its revenue contribution, both in terms of timing and how big a part of the business it could realistically become for Sleep Cycle? It's a very interesting question. What we're doing right now in parallel, we're doing all the documentation and the clinical trials, is that we're doing tests with the customers. We have to remember, we have a very big advantage in that we have millions of monthly active users. I think those users that today, for some reason, don't want to pay a premium subscription for Sleep Cycle, they will come in very handy when we have an offer for sleep apnea screening. Once we're ready, we will not go out and try to find customers in B2C. We already have millions of customers using our product. We will be instantly in a position where we can offer that to them, and that makes it very attractive to me. Likewise, what we will start doing during the next coming quarters is to also advance our partnership focus into looking for partners that would like to utilize the SDK for sleep apnea once that is ready and approved. We will have a dual focus here. It's hard to say what it would mean for Sleep Cycle in terms of exact money, etc. I'm, of course, very excited about the opportunity. As I said on the call, this is a huge opportunity. It's close to a billion people that have this. Today, it's really hard for them to get diagnosed and to get the help they need. I believe that this could absolutely be the biggest area in the future of Sleep Cycle with us being medtech certified for sleep apnea screening. We have some questions from Jessica Grunewald at Redeye. Partnerships continue to perform strongly. Can you share insights on which partnerships are driving the most growth? We have some partners that we are growing that are existing partners, but we are also adding new partners on top of it. I can just say that when I look at the pipeline going forward and when I look at the partners that we have, that's why I say I feel very confident in that I expect them to continue to grow also in this quarter. Next question. What traction are you seeing with the Powered by Sleep SDK so far, and what types of partners are most engaged? Okay. Right now we are discussing with partners with wearables. We see a lot of traction with them because it's a very obvious fit where they today cannot offer sound and all the benefits that come with sound. That's a good discussion that we have. We have other IoT companies and also some apps that we're actively discussing with. Okay, that's it. Good. Thank you very much for your questions. Sorry for the delayed start due to technical problems, but I'm happy that you guys listened in and also for the good questions here towards the end. Thank you very much. Thank you so much.

Speaker 1: Okay. Hi, everyone. Unfortunately, we had some technical challenges here on the call, but we are live now and we're ready to go. Apologies for the wait. Good morning as well, and thank you for joining us at Sleep Cycle's Quarter Three 2025 interim report presentation. I'm Erik Jivmark. I'm the CEO of Sleep Cycle. I'm here together with our CFO and Head of Investor Relations, Elisabeth Hedman. In this call, we will walk you through the key highlights from the quarter and our progress on the strategic initiatives and also an update on our financials. Together, we will also address any questions you might have in the Q&A at the end. We're Sleep Cycle. We're the world's leading sleep technology company. We have a mission to improve global health by helping people to take control of their sleep. Okay. okay Hi, everyone. hi everyone Unfortunately, we had some technical challenges here on the call, but we are live now and we're ready to go. unfortunately we had some technical challenges here on the call but we are live now and we're ready to go Apologies for the wait. apologies for the wait Good morning as well, and thank you for joining us at Sleep Cycle's Quarter Three 2025 interim report presentation. good morning as well and thank you for joining us at sleep cycle's quarter three 2025 interim report presentation I'm Erik Jivmark. i'm erik jivmark I'm the CEO of Sleep Cycle. i'm the ceo of sleep cycle I'm here together with our CFO and Head of Investor Relations, Elisabeth Hedman. i'm here together with our cfo and head of investor relations elisabeth hedman In this call, we will walk you through the key highlights from the quarter and our progress on the strategic initiatives and also an update on our financials. in this call we will walk you through the key highlights from the quarter and our progress on the strategic initiatives and also an update on our financials Together, we will also address any questions you might have in the Q&A at the end. together we will also address any questions you might have in the q&a at the end We're Sleep Cycle. we're sleep cycle We're the world's leading sleep technology company. we're the world's leading sleep technology company We have a mission to improve global health by helping people to take control of their sleep. we have a mission to improve global health by helping people to take control of their sleep Everything we do aims to turn high-quality sleep into an accessible daily habit at scale. We're used and loved by millions, and we're available in more than 180 markets, in app stores, and as part of many wearables. Today, we're proud to be the world's number one sleep app. We're helping people to build healthy sleep habits, something that is more needed than ever. What sets us apart goes far beyond that. At the core of everything we do is our proprietary AI sound model. This technology not only powers the app millions of users rely on each night, it also creates one of the world's richest health data streams. With the help of this, we're entering a new phase. It's not a new strategy. It's a new execution model for that strategy. We call it Powered by Sleep Cycle. Everything we do aims to turn high-quality sleep into an accessible daily habit at scale. everything we do aims to turn high-quality sleep into an accessible daily habit at scale We're used and loved by millions, and we're available in more than 180 markets, in app stores, and as part of many wearables. we're used and loved by millions and we're available in more than 180 markets in app stores and as part of many wearables Today, we're proud to be the world's number one sleep app. today we're proud to be the world's number one sleep app We're helping people to build healthy sleep habits, something that is more needed than ever. we're helping people to build healthy sleep habits something that is more needed than ever What sets us apart goes far beyond that. what sets us apart goes far beyond that At the core of everything we do is our proprietary AI sound model. at the core of everything we do is our proprietary ai sound model This technology not only powers the app millions of users rely on each night, it also creates one of the world's richest health data streams. this technology not only powers the app millions of users rely on each night it also creates one of the world's richest health data streams With the help of this, we're entering a new phase. with the help of this we're entering a new phase It's not a new strategy. it's not a new strategy It's a new execution model for that strategy. it's a new execution model for that strategy We call it Powered by Sleep Cycle. we call it powered by sleep cycle During Quarter Three, we presented our Sleep SDK, opening up access to this technology. Partners across wellness, healthcare, wearables, and beyond can now integrate our capabilities directly into their own platforms. To me, this is an extension of our successful partnership strategy. We're creating new high-margin revenue opportunities, reaching an audience outside our own app. Our strategy is clear: continue growing our consumer business while expanding the value of our platform. On one hand, that means strengthening user acquisition, engagement, and retention. On the other, we're building new monetization paths, especially around data, technology, and medtech with sleep apnea screening. This dual focus allows us to scale both our reach and our impact. Throughout the year, we've been very transparent about the fact that the sleep tracking segments have headwinds in the App Store. During Quarter Three, we presented our Sleep SDK, opening up access to this technology. during quarter three we presented our sleep sdk opening up access to this technology Partners across wellness, healthcare, wearables, and beyond can now integrate our capabilities directly into their own platforms. partners across wellness healthcare wearables and beyond can now integrate our capabilities directly into their own platforms To me, this is an extension of our successful partnership strategy. to me this is an extension of our successful partnership strategy We're creating new high-margin revenue opportunities, reaching an audience outside our own app. we're creating new high-margin revenue opportunities reaching an audience outside our own app Our strategy is clear: continue growing our consumer business while expanding the value of our platform. our strategy is clear continue growing our consumer business while expanding the value of our platform On one hand, that means strengthening user acquisition, engagement, and retention. on one hand that means strengthening user acquisition engagement and retention On the other, we're building new monetization paths, especially around data, technology, and medtech with sleep apnea screening. on the other we're building new monetization paths especially around data technology and medtech with sleep apnea screening This dual focus allows us to scale both our reach and our impact. this dual focus allows us to scale both our reach and our impact Throughout the year, we've been very transparent about the fact that the sleep tracking segments have headwinds in the App Store. throughout the year we've been very transparent about the fact that the sleep tracking segments have headwinds in the app store However, as you can see at the chart with data from SensorTower, we're performing relatively better than the entire health and fitness app segment. We're taking market shares in both downloads and revenue. Sleep apps are part of health and fitness. However, when we group together and compare with our direct competitors, our performance looks even better. We show resilience, and we do that leading with product innovation and a stronger business acumen across the organization. Speaking of product development, in Quarter Three, we shipped the liquid glass design alongside iOS 26, making navigation clearer and highlighting premium value. We prepared the first AI sleep coach, planned to be released in Quarter Four, to make the app more proactive, personalized, and habit-forming. Smart alarm refinements continue to improve perceived wake-up quality and also help our engagement. We also increased new sales price with around 10% in key markets. However, as you can see at the chart with data from SensorTower, we're performing relatively better than the entire health and fitness app segment. however as you can see at the chart with data from sensortower we're performing relatively better than the entire health and fitness app segment We're taking market shares in both downloads and revenue. we're taking market shares in both downloads and revenue Sleep apps are part of health and fitness. sleep apps are part of health and fitness However, when we group together and compare with our direct competitors, our performance looks even better. however when we group together and compare with our direct competitors our performance looks even better We show resilience, and we do that leading with product innovation and a stronger business acumen across the organization. we show resilience and we do that leading with product innovation and a stronger business acumen across the organization Speaking of product development, in Quarter Three, we shipped the liquid glass design alongside iOS 26, making navigation clearer and highlighting premium value. speaking of product development in quarter three we shipped the liquid glass design alongside ios 26 making navigation clearer and highlighting premium value We prepared the first AI sleep coach, planned to be released in Quarter Four, to make the app more proactive, personalized, and habit-forming. we prepared the first ai sleep coach planned to be released in quarter four to make the app more proactive personalized and habit-forming Smart alarm refinements continue to improve perceived wake-up quality and also help our engagement. smart alarm refinements continue to improve perceived wake-up quality and also help our engagement We also increased new sales price with around 10% in key markets. we also increased new sales price with around 10% in key markets Because revenue is recognized over 12 months, we reported ARPU lags, but the pricing supports ARPU in the long run. If we look at new sales for September isolated, ARPU was CHF 296. But adjusted for FX, it was CHF 318. We have continued to raise prices in October. Currently, in the U.S., which is our largest market, new sales ARPU is close to CHF 500 now in October. It's up 25% since July. This means that we are improving top-line performance over time, and it's also helping us in pricing the product right with future partners. When it comes to partners, things are going very well. They continue to grow, up 55% year-over-year and 13% quarter over quarter. Partnerships now stand for 11% of total revenue. To me, partnerships is about reaching new customers without any additional acquisition cost. Because revenue is recognized over 12 months, we reported ARPU lags, but the pricing supports ARPU in the long run. because revenue is recognized over 12 months we reported arpu lags but the pricing supports arpu in the long run If we look at new sales for September isolated, ARPU was CHF 296. if we look at new sales for september isolated arpu was chf 296 But adjusted for FX, it was CHF 318. but adjusted for fx it was chf 318 We have continued to raise prices in October. we have continued to raise prices in october Currently, in the U.S., which is our largest market, new sales ARPU is close to CHF 500 now in October. currently in the u.s which is our largest market new sales arpu is close to chf 500 now in october It's up 25% since July. it's up 25% since july This means that we are improving top-line performance over time, and it's also helping us in pricing the product right with future partners. this means that we are improving top-line performance over time and it's also helping us in pricing the product right with future partners When it comes to partners, things are going very well. when it comes to partners things are going very well They continue to grow, up 55% year-over-year and 13% quarter over quarter. they continue to grow up 55% year-over-year and 13% quarter over quarter Partnerships now stand for 11% of total revenue. partnerships now stand for 11% of total revenue To me, partnerships is about reaching new customers without any additional acquisition cost. to me partnerships is about reaching new customers without any additional acquisition cost It's also about taking control of our own destiny, relying less on storefronts, creating a more diversified and resilient revenue base, and a deeper presence in the wider health ecosystem. I am expecting the app partnerships to continue to grow also in Quarter Four. That's not all. During Quarter Three, we also took another major leap. With our Powered by Sleep SDK, partners can integrate our world-leading AI sleep analysis into their products. It's contactless, it's real-time, and it's built on years of machine learning. Commercially, this opens up a new recurring licensing model, and it also accelerates how we scale our mission beyond our own app. It's also about taking control of our own destiny, relying less on storefronts, creating a more diversified and resilient revenue base, and a deeper presence in the wider health ecosystem. it's also about taking control of our own destiny relying less on storefronts creating a more diversified and resilient revenue base and a deeper presence in the wider health ecosystem I am expecting the app partnerships to continue to grow also in Quarter Four. i am expecting the app partnerships to continue to grow also in quarter four That's not all. that's not all During Quarter Three, we also took another major leap. during quarter three we also took another major leap With our Powered by Sleep SDK, partners can integrate our world-leading AI sleep analysis into their products. with our powered by sleep sdk partners can integrate our world-leading ai sleep analysis into their products It's contactless, it's real-time, and it's built on years of machine learning. it's contactless it's real-time and it's built on years of machine learning Commercially, this opens up a new recurring licensing model, and it also accelerates how we scale our mission beyond our own app. commercially this opens up a new recurring licensing model and it also accelerates how we scale our mission beyond our own app During Quarter Three, the focus was to release the SDK for us to move from theoretic discussions with partners into more tangible dialogues, where we are now in Quarter Four looking for partners that want to pilot this and enhance their core experience. We are in the beginning of our journey, but I'm very excited about the possibilities ahead. We don't stop with the SDK for other companies to license. We are also looking to use our own technology in new ways. As part of this, we have sleep apnea, which affects over 950 million people worldwide. Yet, 80% remain undiagnosed. It's exposing them to significantly higher risks of heart disease, stroke, and diabetes. Traditional diagnostics are costly and quite inaccessible. That's where Sleep Cycle comes in. We're using our proprietary audio-based AI, already trusted by millions nightly, to enable non-invasive smartphone-based apnea screening. During Quarter Three, the focus was to release the SDK for us to move from theoretic discussions with partners into more tangible dialogues, where we are now in Quarter Four looking for partners that want to pilot this and enhance their core experience. during quarter three the focus was to release the sdk for us to move from theoretic discussions with partners into more tangible dialogues where we are now in quarter four looking for partners that want to pilot this and enhance their core experience We are in the beginning of our journey, but I'm very excited about the possibilities ahead. we are in the beginning of our journey but i'm very excited about the possibilities ahead We don't stop with the SDK for other companies to license. we don't stop with the sdk for other companies to license We are also looking to use our own technology in new ways. we are also looking to use our own technology in new ways As part of this, we have sleep apnea, which affects over 950 million people worldwide. as part of this we have sleep apnea which affects over 950 million people worldwide Yet, 80% remain undiagnosed. yet 80% remain undiagnosed It's exposing them to significantly higher risks of heart disease, stroke, and diabetes. it's exposing them to significantly higher risks of heart disease stroke and diabetes Traditional diagnostics are costly and quite inaccessible. traditional diagnostics are costly and quite inaccessible That's where Sleep Cycle comes in. that's where sleep cycle comes in We're using our proprietary audio-based AI, already trusted by millions nightly, to enable non-invasive smartphone-based apnea screening. we're using our proprietary audio-based ai already trusted by millions nightly to enable non-invasive smartphone-based apnea screening No wearables, no cables, no clinic visits. AI-powered screening using only the iPhone microphone. Medical-grade precision with consumer-grade simplicity. It's such a natural extension of our platform, and it's aligned with our mission to improve global health. Importantly, it reflects the shift toward proactive, personalized healthcare. Our sleep apnea initiative represents one of the most significant growth opportunities for Sleep Cycle. The clinical study we launched in June is now about 20% complete, which marks an important step toward medical certification. As the study progresses, we're also working in parallel on documentation audits and commercial optimization. The goal is to be ready for submission to both FDA and then a European notified body toward the end of next year, 2026. Longer term, this initiative opens two strategic revenue paths: new consumer offerings within the app and future health tech licensing opportunities with partners in the healthcare ecosystem. No wearables, no cables, no clinic visits. no wearables no cables no clinic visits AI-powered screening using only the iPhone microphone. ai-powered screening using only the iphone microphone Medical-grade precision with consumer-grade simplicity. medical-grade precision with consumer-grade simplicity It's such a natural extension of our platform, and it's aligned with our mission to improve global health. it's such a natural extension of our platform and it's aligned with our mission to improve global health Importantly, it reflects the shift toward proactive, personalized healthcare. importantly it reflects the shift toward proactive personalized healthcare Our sleep apnea initiative represents one of the most significant growth opportunities for Sleep Cycle. our sleep apnea initiative represents one of the most significant growth opportunities for sleep cycle The clinical study we launched in June is now about 20% complete, which marks an important step toward medical certification. the clinical study we launched in june is now about 20% complete which marks an important step toward medical certification As the study progresses, we're also working in parallel on documentation audits and commercial optimization. as the study progresses we're also working in parallel on documentation audits and commercial optimization The goal is to be ready for submission to both FDA and then a European notified body toward the end of next year, 2026. the goal is to be ready for submission to both fda and then a european notified body toward the end of next year 2026 Longer term, this initiative opens two strategic revenue paths: new consumer offerings within the app and future health tech licensing opportunities with partners in the healthcare ecosystem. longer term this initiative opens two strategic revenue paths new consumer offerings within the app and future health tech licensing opportunities with partners in the healthcare ecosystem With that, I will hand over to Elisabeth Hedman that will walk us through the financial performance for the quarter. With that, I will hand over to Elisabeth Hedman that will walk us through the financial performance for the quarter. with that i will hand over to elisabeth hedman that will walk us through the financial performance for the quarter

Speaker 2: Thank you, Erik. Let's move on to the financials. The number of paying subscribers ended at 832,000, down 9% from last year, reflecting the softer development of the segment. ARPU was CHF 271 or CHF 276 when adjusted for FX effects. It's slightly lower than last year. We have raised the prices, and the price adjustments we implemented during the quarter will gradually support ARPU over time, though the reported metric lags due to recognition of revenue, and most of our subscriptions are 12 months. We continue with testing new price points on different markets to improve the long-term value per customer. Net sales for the quarter amounted to CHF 62 million, which is a decrease of 6.6% year-over-year or 4.7% FX adjusted. EBIT for the quarter was CHF 17 million, a margin of 27.3%. Let's take a look at the subscriber and revenue development. Thank you, Erik. thank you erik Let's move on to the financials. let's move on to the financials The number of paying subscribers ended at 832,000, down 9% from last year, reflecting the softer development of the segment. the number of paying subscribers ended at 832,000 down 9% from last year reflecting the softer development of the segment ARPU was CHF 271 or CHF 276 when adjusted for FX effects. arpu was chf 271 or chf 276 when adjusted for fx effects It's slightly lower than last year. it's slightly lower than last year We have raised the prices, and the price adjustments we implemented during the quarter will gradually support ARPU over time, though the reported metric lags due to recognition of revenue, and most of our subscriptions are 12 months. we have raised the prices and the price adjustments we implemented during the quarter will gradually support arpu over time though the reported metric lags due to recognition of revenue and most of our subscriptions are 12 months We continue with testing new price points on different markets to improve the long-term value per customer. we continue with testing new price points on different markets to improve the long-term value per customer Net sales for the quarter amounted to CHF 62 million, which is a decrease of 6.6% year-over-year or 4.7% FX adjusted. net sales for the quarter amounted to chf 62 million which is a decrease of 6.6% year-over-year or 4.7% fx adjusted EBIT for the quarter was CHF 17 million, a margin of 27.3%. ebit for the quarter was chf 17 million a margin of 27.3% Let's take a look at the subscriber and revenue development. let's take a look at the subscriber and revenue development The number of paying subscribers, as I said, 832,000, mainly due to a lower intake of new customers and our focus on improving ARPU and long-term value per user rather than pure volume growth. The retention among existing users remains stable, which shows the strength of the core product and user engagement. Net sales decreased by 6.6% or 4.7% FX adjusted. The main drivers were lower new customer sales and continued FX pressure, while reported ARPU lags the impact of the recent price increases. Importantly, partnership revenue continues to grow strongly. It's up 55% year-over-year and now accounts for 11% of our total revenue. This confirms that our diversification efforts are working and that partner demand for our brand and technology remains strong. If we move to profitability, you'll see that margins remain solid despite the softer top line. The number of paying subscribers, as I said, 832,000, mainly due to a lower intake of new customers and our focus on improving ARPU and long-term value per user rather than pure volume growth. the number of paying subscribers as i said 832,000 mainly due to a lower intake of new customers and our focus on improving arpu and long-term value per user rather than pure volume growth The retention among existing users remains stable, which shows the strength of the core product and user engagement. the retention among existing users remains stable which shows the strength of the core product and user engagement Net sales decreased by 6.6% or 4.7% FX adjusted. net sales decreased by 6.6% or 4.7% fx adjusted The main drivers were lower new customer sales and continued FX pressure, while reported ARPU lags the impact of the recent price increases. the main drivers were lower new customer sales and continued fx pressure while reported arpu lags the impact of the recent price increases Importantly, partnership revenue continues to grow strongly. importantly partnership revenue continues to grow strongly It's up 55% year-over-year and now accounts for 11% of our total revenue. it's up 55% year-over-year and now accounts for 11% of our total revenue This confirms that our diversification efforts are working and that partner demand for our brand and technology remains strong. this confirms that our diversification efforts are working and that partner demand for our brand and technology remains strong If we move to profitability, you'll see that margins remain solid despite the softer top line. if we move to profitability you'll see that margins remain solid despite the softer top line EBIT for the quarter came in at CHF 7 million, which corresponds to 27.3% to be compared with 31.3% a year ago. There have been no non-recurring items during this year. Despite the lower revenue top line, we do maintain the high margin for this quarter. The decrease in EBIT compared to last year is mainly explained by lower revenue and FX impact, while costs are well controlled. Distribution costs were lower due to reduced App Store commission as a result of less new sales. External costs were somewhat higher, linked to continued growth-related initiatives. Staff costs were stable with a slight increase in headcount compared to last year. The cash flow from operations was CHF 5.5 million. Liquidity remained strong at CHF 114 million at the end of the quarter. We did capitalize CHF 2.6 million related to sleep apnea screening and Sleep Cycle SDK during the quarter. EBIT for the quarter came in at CHF 7 million, which corresponds to 27.3% to be compared with 31.3% a year ago. ebit for the quarter came in at chf 7 million which corresponds to 27.3% to be compared with 31.3% a year ago There have been no non-recurring items during this year. there have been no non-recurring items during this year Despite the lower revenue top line, we do maintain the high margin for this quarter. despite the lower revenue top line we do maintain the high margin for this quarter The decrease in EBIT compared to last year is mainly explained by lower revenue and FX impact, while costs are well controlled. the decrease in ebit compared to last year is mainly explained by lower revenue and fx impact while costs are well controlled Distribution costs were lower due to reduced App Store commission as a result of less new sales. distribution costs were lower due to reduced app store commission as a result of less new sales External costs were somewhat higher, linked to continued growth-related initiatives. external costs were somewhat higher linked to continued growth-related initiatives Staff costs were stable with a slight increase in headcount compared to last year. staff costs were stable with a slight increase in headcount compared to last year The cash flow from operations was CHF 5.5 million. the cash flow from operations was chf 5.5 million Liquidity remained strong at CHF 114 million at the end of the quarter. liquidity remained strong at chf 114 million at the end of the quarter We did capitalize CHF 2.6 million related to sleep apnea screening and Sleep Cycle SDK during the quarter. we did capitalize chf 2.6 million related to sleep apnea screening and sleep cycle sdk during the quarter For the nine-month period, net sales was CHF 190 million, down 2.4% year-over-year or 1.3% FX adjusted. EBIT reached CHF 52 million. The number for last year was impacted by non-recurring items related to reorganization, mainly within staff costs. The EBIT margin for the period should be compared to 31.4% last year. As I said, for the quarter, external costs are slightly higher, reflecting growth-related activities, while depreciation decreased as the lease for the former Stockholm office is no longer in the base. Our cash generation continues to be strong. We had an operating cash flow for the full period of CHF 42 million. We did distribute CHF 61 million in dividends during Q2. We have capitalized CHF 9.3 million for the period, mainly related to the sleep apnea screening. Overall, this demonstrates a resilient business model with stable profitability and healthy balance sheets. For the nine-month period, net sales was CHF 190 million, down 2.4% year-over-year or 1.3% FX adjusted. for the nine-month period net sales was chf 190 million down 2.4% year-over-year or 1.3% fx adjusted EBIT reached CHF 52 million. ebit reached chf 52 million The number for last year was impacted by non-recurring items related to reorganization, mainly within staff costs. the number for last year was impacted by non-recurring items related to reorganization mainly within staff costs The EBIT margin for the period should be compared to 31.4% last year. the ebit margin for the period should be compared to 31.4% last year As I said, for the quarter, external costs are slightly higher, reflecting growth-related activities, while depreciation decreased as the lease for the former Stockholm office is no longer in the base. as i said for the quarter external costs are slightly higher reflecting growth-related activities while depreciation decreased as the lease for the former stockholm office is no longer in the base Our cash generation continues to be strong. our cash generation continues to be strong We had an operating cash flow for the full period of CHF 42 million. we had an operating cash flow for the full period of chf 42 million We did distribute CHF 61 million in dividends during Q2. we did distribute chf 61 million in dividends during q2 We have capitalized CHF 9.3 million for the period, mainly related to the sleep apnea screening. we have capitalized chf 9.3 million for the period mainly related to the sleep apnea screening Overall, this demonstrates a resilient business model with stable profitability and healthy balance sheets. overall this demonstrates a resilient business model with stable profitability and healthy balance sheets Now over to you, Erik, to summarize the quarter. Now over to you, Erik, to summarize the quarter. now over to you erik to summarize the quarter

Speaker 1: Thank you, Elisabeth. Q3 has been a very intense quarter. We are continuing our transformation. We are taking control of our own destiny with diversifying revenue streams and also expanding our core product into new areas, such as AI coaching. We do that while actively taking steps to protect our top line with price increases in key markets. Also, the Powered by Sleep SDK is launched, meaning that we can now move discussions from PowerPoint to reality. We're looking for pilot customers in the fourth quarter for our tech licensing initiative. Secondly, the sleep apnea screening solution study is progressing toward certification. We're now at a 20% completion rate in our clinical trials. Compared to other studies, we're moving fast, and the team is doing a great job with this. Earlier bets, such as our focus on partnerships, are paying off. Thank you, Elisabeth. thank you elisabeth Q3 has been a very intense quarter. q3 has been a very intense quarter We are continuing our transformation. we are continuing our transformation We are taking control of our own destiny with diversifying revenue streams and also expanding our core product into new areas, such as AI coaching. we are taking control of our own destiny with diversifying revenue streams and also expanding our core product into new areas such as ai coaching We do that while actively taking steps to protect our top line with price increases in key markets. we do that while actively taking steps to protect our top line with price increases in key markets Also, the Powered by Sleep SDK is launched, meaning that we can now move discussions from PowerPoint to reality. also, the powered by sleep sdk is launched meaning that we can now move discussions from powerpoint to reality We're looking for pilot customers in the fourth quarter for our tech licensing initiative. we're looking for pilot customers in the fourth quarter for our tech licensing initiative Secondly, the sleep apnea screening solution study is progressing toward certification. secondly the sleep apnea screening solution study is progressing toward certification We're now at a 20% completion rate in our clinical trials. we're now at a 20% completion rate in our clinical trials Compared to other studies, we're moving fast, and the team is doing a great job with this. compared to other studies we're moving fast and the team is doing a great job with this Earlier bets, such as our focus on partnerships, are paying off. earlier bets such as our focus on partnerships are paying off We're up 55% year-over-year, and partnerships are now 11% of our revenue. That's why we will continue and double down on it going forward. Together, these steps prepare the company for growth beyond the App Store. We have a clear strategy in place. We have a motivated and talented team. Together, we're building a more resilient Sleep Cycle for the future. With that, we're opening up for any questions you might have. We're up 55% year-over-year, and partnerships are now 11% of our revenue. we're up 55% year-over-year and partnerships are now 11% of our revenue That's why we will continue and double down on it going forward. that's why we will continue and double down on it going forward Together, these steps prepare the company for growth beyond the App Store. together these steps prepare the company for growth beyond the app store We have a clear strategy in place. we have a clear strategy in place We have a motivated and talented team. we have a motivated and talented team Together, we're building a more resilient Sleep Cycle for the future. together we're building a more resilient sleep cycle for the future With that, we're opening up for any questions you might have. with that we're opening up for any questions you might have

Speaker 2: We have a question from Johan Boström, who asks if we will start reporting partnership revenue going forward quarterly. Yes, we do report this since Q2, and we plan to continue doing this. We have a question here from Gustav. You say that you're still number one. Which competitors do you compare with? In the U.S., if the U.S. is your largest market, you are ranked 102, but you have several sleep tracking apps yielding higher ARR in the top 20 lists. What is the basis for your number one claim? We have a question from Johan Boström, who asks if we will start reporting partnership revenue going forward quarterly. we have a question from johan boström who asks if we will start reporting partnership revenue going forward quarterly Yes, we do report this since Q2, and we plan to continue doing this. yes we do report this since q2 and we plan to continue doing this We have a question here from Gustav. we have a question here from gustav You say that you're still number one. you say that you're still number one Which competitors do you compare with? which competitors do you compare with In the U.S., if the U.S. is your largest market, you are ranked 102, but you have several sleep tracking apps yielding higher ARR in the top 20 lists. in the u.s if the u.s is your largest market you are ranked 102 but you have several sleep tracking apps yielding higher arr in the top 20 lists What is the basis for your number one claim? what is the basis for your number one claim

Speaker 1: We are, over time, the largest sleep app. I think the number you're looking at or referring to is probably a category ranking in the App Store. As I shared, the data from SensorTower, which is the official data that we refer to, we can see that we take both market share and also revenue in the segment. That is what's supporting the claim. We are, over time, the largest sleep app. we are over time the largest sleep app I think the number you're looking at or referring to is probably a category ranking in the App Store. i think the number you're looking at or referring to is probably a category ranking in the app store As I shared, the data from SensorTower, which is the official data that we refer to, we can see that we take both market share and also revenue in the segment. as i shared the data from sensortower which is the official data that we refer to we can see that we take both market share and also revenue in the segment That is what's supporting the claim. that is what's supporting the claim

Speaker 2: Another question regarding the SDK program. That is an exciting one, but I'm hesitant on user adoption due to the partner app requiring the user to have the app open while sleeping since you analyze sleep through sound. How do you tackle that? How many partners have onboarded into the SDK program? Another question regarding the SDK program. another question regarding the sdk program That is an exciting one, but I'm hesitant on user adoption due to the partner app requiring the user to have the app open while sleeping since you analyze sleep through sound. that is an exciting one but i'm hesitant on user adoption due to the partner app requiring the user to have the app open while sleeping since you analyze sleep through sound How do you tackle that? how do you tackle that How many partners have onboarded into the SDK program? how many partners have onboarded into the sdk program

Speaker 1: The SDK was just launched, 20 days ago or so. What I see in the discussions that we have is that we actually have quite a lot of partners that either today is a wearable where sound is something that would complement their offering and allow them to do things that they cannot do today. It could also be things that are non-wearable. It could be IoT-related stuff where sound is a natural part of how the consumer interacts with the product. We also saw interest from companies today where they would like to have the SDK as part of their app experience, where they would then need to have the customer have the app active during the night. They see that there is an interest in doing so, given what they can give back to the customer in terms of data and experience. The SDK was just launched, 20 days ago or so. the sdk was just launched 20 days ago or so What I see in the discussions that we have is that we actually have quite a lot of partners that either today is a wearable where sound is something that would complement their offering and allow them to do things that they cannot do today. what i see in the discussions that we have is that we actually have quite a lot of partners that either today is a wearable where sound is something that would complement their offering and allow them to do things that they cannot do today It could also be things that are non-wearable. it could also be things that are non-wearable It could be IoT-related stuff where sound is a natural part of how the consumer interacts with the product. it could be iot-related stuff where sound is a natural part of how the consumer interacts with the product We also saw interest from companies today where they would like to have the SDK as part of their app experience, where they would then need to have the customer have the app active during the night. we also saw interest from companies today where they would like to have the sdk as part of their app experience where they would then need to have the customer have the app active during the night They see that there is an interest in doing so, given what they can give back to the customer in terms of data and experience. they see that there is an interest in doing so given what they can give back to the customer in terms of data and experience As I said previously, this quarter, I hope that we can sign some pilot customers and get going and moving from the discussions that we have into reality. I hope we can talk more about that next time. As I said previously, this quarter, I hope that we can sign some pilot customers and get going and moving from the discussions that we have into reality. as i said previously this quarter i hope that we can sign some pilot customers and get going and moving from the discussions that we have into reality I hope we can talk more about that next time. i hope we can talk more about that next time

Speaker 2: We have a couple of questions regarding the dynamics between price increases and subs development, what we can expect going forward, and if the price increases could have affected the growth in subs in Q3. We have a couple of questions regarding the dynamics between price increases and subs development, what we can expect going forward, and if the price increases could have affected the growth in subs in Q3. we have a couple of questions regarding the dynamics between price increases and subs development what we can expect going forward and if the price increases could have affected the growth in subs in q3

Speaker 1: The segment is what the segment is when it comes to growth. That’s why we want to be transparent about that. What we do now with price is that we're doing these changes in a very precise manner. We're basically dividing the markets in different cohorts with different prices. We monitor that for a while, and then we pick the one that optimizes revenue the most or sales. Of course, we're also keeping an eye on how it impacts subscribers. I think that answers that question. The other one was if the price increase could put you back to growth already in Quarter Four. I would say, given how the segment is developing so far in the quarter and also the delay we have with the 12-month subs that we're selling, I think it's too early to say and not something I want to speculate into. The segment is what the segment is when it comes to growth. the segment is what the segment is when it comes to growth That’s why we want to be transparent about that. that’s why we want to be transparent about that What we do now with price is that we're doing these changes in a very precise manner. what we do now with price is that we're doing these changes in a very precise manner We're basically dividing the markets in different cohorts with different prices. we're basically dividing the markets in different cohorts with different prices We monitor that for a while, and then we pick the one that optimizes revenue the most or sales. we monitor that for a while and then we pick the one that optimizes revenue the most or sales Of course, we're also keeping an eye on how it impacts subscribers. of course we're also keeping an eye on how it impacts subscribers I think that answers that question. i think that answers that question The other one was if the price increase could put you back to growth already in Quarter Four. the other one was if the price increase could put you back to growth already in quarter four I would say, given how the segment is developing so far in the quarter and also the delay we have with the 12-month subs that we're selling, I think it's too early to say and not something I want to speculate into. i would say given how the segment is developing so far in the quarter and also the delay we have with the 12-month subs that we're selling i think it's too early to say and not something i want to speculate into

Speaker 2: We have a question regarding the sleep apnea study. If it proves successful and we move into commercialization, what would be considered a realistic scenario for its revenue contribution, both in terms of timing and how big a part of the business it could realistically become for Sleep Cycle? We have a question regarding the sleep apnea study. we have a question regarding the sleep apnea study If it proves successful and we move into commercialization, what would be considered a realistic scenario for its revenue contribution, both in terms of timing and how big a part of the business it could realistically become for Sleep Cycle? if it proves successful and we move into commercialization what would be considered a realistic scenario for its revenue contribution both in terms of timing and how big a part of the business it could realistically become for sleep cycle

Speaker 1: It's a very interesting question. What we're doing right now in parallel, we're doing all the documentation and the clinical trials, is that we're doing tests with the customers. We have to remember, we have a very big advantage in that we have millions of monthly active users. I think those users that today, for some reason, don't want to pay a premium subscription for Sleep Cycle, they will come in very handy when we have an offer for sleep apnea screening. Once we're ready, we will not go out and try to find customers in B2C. We already have millions of customers using our product. We will be instantly in a position where we can offer that to them, and that makes it very attractive to me. It's a very interesting question. it's a very interesting question What we're doing right now in parallel, we're doing all the documentation and the clinical trials, is that we're doing tests with the customers. what we're doing right now in parallel we're doing all the documentation and the clinical trials is that we're doing tests with the customers We have to remember, we have a very big advantage in that we have millions of monthly active users. we have to remember we have a very big advantage in that we have millions of monthly active users I think those users that today, for some reason, don't want to pay a premium subscription for Sleep Cycle, they will come in very handy when we have an offer for sleep apnea screening. i think those users that today for some reason don't want to pay a premium subscription for sleep cycle they will come in very handy when we have an offer for sleep apnea screening Once we're ready, we will not go out and try to find customers in B2C. once we're ready we will not go out and try to find customers in b2c We already have millions of customers using our product. we already have millions of customers using our product We will be instantly in a position where we can offer that to them, and that makes it very attractive to me. we will be instantly in a position where we can offer that to them and that makes it very attractive to me Likewise, what we will start doing during the next coming quarters is to also advance our partnership focus into looking for partners that would like to utilize the SDK for sleep apnea once that is ready and approved. We will have a dual focus here. It's hard to say what it would mean for Sleep Cycle in terms of exact money, etc. I'm, of course, very excited about the opportunity. As I said on the call, this is a huge opportunity. It's close to a billion people that have this. Today, it's really hard for them to get diagnosed and to get the help they need. I believe that this could absolutely be the biggest area in the future of Sleep Cycle with us being medtech certified for sleep apnea screening. Likewise, what we will start doing during the next coming quarters is to also advance our partnership focus into looking for partners that would like to utilize the SDK for sleep apnea once that is ready and approved. likewise what we will start doing during the next coming quarters is to also advance our partnership focus into looking for partners that would like to utilize the sdk for sleep apnea once that is ready and approved We will have a dual focus here. we will have a dual focus here It's hard to say what it would mean for Sleep Cycle in terms of exact money, etc. I'm, of course, very excited about the opportunity. it's hard to say what it would mean for sleep cycle in terms of exact money etc i'm of course very excited about the opportunity As I said on the call, this is a huge opportunity. as i said on the call this is a huge opportunity It's close to a billion people that have this. it's close to a billion people that have this Today, it's really hard for them to get diagnosed and to get the help they need. today it's really hard for them to get diagnosed and to get the help they need I believe that this could absolutely be the biggest area in the future of Sleep Cycle with us being medtech certified for sleep apnea screening. i believe that this could absolutely be the biggest area in the future of sleep cycle with us being medtech certified for sleep apnea screening

Speaker 2: We have some questions from Jessica Grunewald at Redeye. Partnerships continue to perform strongly. Can you share insights on which partnerships are driving the most growth? We have some questions from Jessica Grunewald at Redeye. we have some questions from jessica grunewald at redeye Partnerships continue to perform strongly. partnerships continue to perform strongly Can you share insights on which partnerships are driving the most growth? can you share insights on which partnerships are driving the most growth

Speaker 1: We have some partners that we are growing that are existing partners, but we are also adding new partners on top of it. I can just say that when I look at the pipeline going forward and when I look at the partners that we have, that's why I say I feel very confident in that I expect them to continue to grow also in this quarter. We have some partners that we are growing that are existing partners, but we are also adding new partners on top of it. we have some partners that we are growing that are existing partners but we are also adding new partners on top of it I can just say that when I look at the pipeline going forward and when I look at the partners that we have, that's why I say I feel very confident in that I expect them to continue to grow also in this quarter. i can just say that when i look at the pipeline going forward and when i look at the partners that we have that's why i say i feel very confident in that i expect them to continue to grow also in this quarter

Speaker 2: Next question. What traction are you seeing with the Powered by Sleep SDK so far, and what types of partners are most engaged? Next question. next question What traction are you seeing with the Powered by Sleep SDK so far, and what types of partners are most engaged? what traction are you seeing with the powered by sleep sdk so far and what types of partners are most engaged

Speaker 1: Okay. Right now we are discussing with partners with wearables. We see a lot of traction with them because it's a very obvious fit where they today cannot offer sound and all the benefits that come with sound. That's a good discussion that we have. We have other IoT companies and also some apps that we're actively discussing with. Okay. okay Right now we are discussing with partners with wearables. right now we are discussing with partners with wearables We see a lot of traction with them because it's a very obvious fit where they today cannot offer sound and all the benefits that come with sound. we see a lot of traction with them because it's a very obvious fit where they today cannot offer sound and all the benefits that come with sound That's a good discussion that we have. that's a good discussion that we have We have other IoT companies and also some apps that we're actively discussing with. we have other iot companies and also some apps that we're actively discussing with

Speaker 2: Okay, that's it. Okay, that's it. okay that's it

Speaker 1: Good. Thank you very much for your questions. Sorry for the delayed start due to technical problems, but I'm happy that you guys listened in and also for the good questions here towards the end. Thank you very much. Good. good Thank you very much for your questions. thank you very much for your questions Sorry for the delayed start due to technical problems, but I'm happy that you guys listened in and also for the good questions here towards the end. sorry for the delayed start due to technical problems but i'm happy that you guys listened in and also for the good questions here towards the end Thank you very much. thank you very much

Speaker 2: Thank you so much. Thank you so much. thank you so much