NEXT Biometrics Group ASA

Q3 revenue was NOK 3 million versus restated NOK 3.7 million in Q3 2024. Adjusted gross margin was 51%, compared with a restated negative gross margin in Q3 2024. Adjusted operating expense was NOK 18.7 million versus NOK 17.3 million a year ago, and adjusted EBITDA was negative NOK 17.8 million versus negative NOK 20.3 million. Cash ended at NOK 7.4 million, down from NOK 22.1 million at the end of Q2 2025, and operating cash flow was negative NOK 13.5 million. Management said Q3 revenue was hurt by low India sales and slowness in China. On guidance, the company said it continues to guide around a 50% gross margin, expects first units from the FAP 30 large production order in Q4, and expects high-volume purchase orders from Evolute in Q4. Management also said operational momentum is expected to kick off in early 2026 and that inventory valued at NOK 34 million corresponds to approximately NOK 70 million in revenue when sold to end customers.

Ulf Ritsvall framed the quarter as the result of a “perfect storm” from India’s temporary Aadhaar pause, channel inventory stuffing, and weak spillover sentiment into other biometric markets. He said those issues are now largely behind the company, with channels normalizing in Q3 and market momentum improving in India, Africa, and other regions. His tone was cautious but optimistic, emphasizing the company’s product breadth, the 81 design wins, and new growth avenues such as the smartphone display technology effort.

Eirik Underthun focused on the reported financials: NOK 3 million revenue, 51% adjusted gross margin, NOK 18.7 million adjusted operating expense, and negative NOK 17.8 million adjusted EBITDA. He highlighted that cash fell to NOK 7.4 million and operating cash flow was negative NOK 13.5 million, driven by lower-than-expected revenues and operating losses. He also noted the NOK 20 million private placement completed in October at NOK 4.25 per share, which will be reflected in Q4 2025 financial statements.

Management was pressed on how 2024 statements ended up materially incorrect. Ulf said the issue stemmed from a combination of the China irregularities and weaker cooperation between operational finance functions, while Roy said the company restated 2024 revenues and net profits by NOK 52 million and NOK 30 million after reviewing historical sales and revenue recognition. On the Chinese partner dispute, Roy said the partner is claiming around NOK 15.6 million, but NEXT believes it has no obligation to compensate and is pursuing arbitration in Oslo. They also said the full-screen fingerprint technology remains under NDA, with patents and IP protection in progress and interest from display manufacturers and smartphone OEMs.