The stage is now set reasonably well for Smart Eye. European car sales grew by approximately 5 percent compared to the same quarter last year. As for the rest of the world, Hyundai accounts for a large portion of Smart Eye’s sales, and sales went well in the US, and also reasonably well in Korea thanks to an excellent June. GM was a bit sluggish, but they still reported record-breaking sales of cars with Super Cruise, so there is tailwind from there as well.
In China, Audi and Nissan sales were weaker than expected. However, their weighting in total sales is lower. Currency exchange rates will certainly continue to be a headwind, but the gale has eased slightly from the previous quarter.
A competitor reported strong delivery figures. Seeing Machines has estimated its market share to be 50 percent of the cars currently being delivered. Smart Eye, in turn, has stated its market share to be 40 percent or more. If we multiply Seeing Machines’ deliveries by two and multiply the total market by 40 percent, we would get nearly 1.7 million cars delivered for Smart Eye in the previous quarter. Calculated in a similar way for Q1, Smart’s market share would have been 37.5 percent based on Redeye’s estimate of 950,000 car deliveries. Seeing Machines has estimated a declining market share throughout the current year and in the coming years as well.
Redeye’s estimates for the previous quarters’ sales have been very accurate, and the estimates for the upcoming reported quarter look quite credible to my eyes. I would even leave a small bullish possibility that if the sales of AIS products have already grown in Q2, a positive revenue surprise could be possible.
I’m somehow excited about the Sightic acquisition from the spring, even though the discussion about impaired driver detection in the US has subsided. Regarding sectors other than automotive, operations are at a very early stage, and the Smart Eye case, if anything, shows that bringing new technology to market takes time and all sorts of things can happen along the way. However, the product feels completely superior for official use, automated checkouts, electric scooter rentals, or anywhere else where age and/or impairment monitoring is needed. Sightic may very well be the new Smart Eye, for better or worse.
I have been wondering if the “to the moon” price reaction is limited by the fact that autonomous driving is coming sooner or later anyway. Doesn’t this make Smart Eye’s business idea, which is based on monitoring the driver, completely obsolete in the future? I haven’t really looked into Smart Eye’s operations beyond Lepikkö’s promotional content.
Is there any preliminary information regarding these autonomous cars, as to whether the car still needs to have a so-called driver, even if the cars were to drive themselves?
An autonomous car makes independent decisions in traffic based on its observations and calculations. Cameras, LiDARs, and other sensors accurately monitor what is happening outside the vehicle, but one would think it is also important to know what is happening inside. For this purpose, it is expected that interior sensing sales will replace DMS (Driver Monitoring Systems) in the future. However, it is a separate matter to consider who will manufacture these in-cabin monitoring systems and whether eye tracking is the most important component of them.
Don’t you think that the majority of autonomous cars will still have a steering wheel and the option to drive the car yourself? Snowstorms, dirt roads, some people wanting to drive themselves, etc. In that case, won’t a camera to monitor the eyes also be needed?
This is asked here at regular intervals. I personally strongly feel that this autonomy, which is arriving in small and slow steps, specifically strengthens the need for driver supervision. The responsibility for the vehicle lies with the driver, and this is how it will likely remain for a long time.
Especially since 100% autonomy is still a very distant thing.
Have you bought Smart Eye from Stockholm or Frankfurt? I don’t really have the energy to look into all the tax policy details, so I’d love to hear the forum’s opinion on which one is better.
I generally always buy shares where there is higher trading volume. There doesn’t seem to be a difference in taxation here, but the SEK exchange rate might have a slight impact on the return.
It doesn’t affect it in any way, because otherwise an arbitrage opportunity would arise where it would be profitable to buy on one exchange and short on another. The market is definitely efficient enough to account for changes in currency exchange rates.
It could very well be that way. But I think part of the market might also hold the opposite view, looking further into the future where cars fly (heh) and a passenger’s eye is only monitored by Specsavers. Because of this, I do believe the share price will follow the earnings, but the valuation multiples going to the moon might be limited due to the uncertain, distant future outlook.
That is the reason why, despite my FOMO, I haven’t touched Smart Eye. Or should I jump on the bandwagon after all?
Looks good. One might guess it’s the VAG group. 100m SEK for three car models during production, the ASP (Average Selling Price) is likely higher than standard DMS. Or maybe the volumes are high. Or a bit of both.
Accidents are going to happen regardless of how autonomous driving becomes. Car manufacturers definitely won’t take responsibility for these accidents; instead, the liability will lie with the driver. And the driver must be prepared to take the wheel, which is why the driver needs to be monitored.
In the future, the situation might be different, but I probably won’t be on this planet investing anymore by then.
The Hidden Facts in Smart Eye’s Design Wins Chart - Proposing a Rule of 40 valuation for the future Anders Storm’s insights on Smart Eye’s valuation and the company’s competitive advantages. He has previously served as CEO of the Swedish semiconductor company (Sivers Semiconductors) and is currently the CEO of Dirac, a company that supplies software to OEMs and Tier 1 suppliers in the automotive industry. The author compares Smart Eye to Sivers Semiconductors – both listed on Nasdaq First North before their markets were mature, repeatedly raised capital, and secured design wins that took longer than expected to convert into revenue. Over the year, Sivers has 10x its share value. Core argument: Smart Eye is transitioning into a “Rule of 40+” software company, which would justify a higher valuation multiple than the market is currently pricing in. A more detailed article is behind a paywall; I don’t have access to it.
