Seeing Machines Limited

Management did not give full statutory FY25 revenue or EPS in the call, but it said FY25 revenue declined versus FY24 mainly because of Guardian Gen2-to-Gen3 transition and lower aviation revenue, which together reduced revenue by around $16 million. Auto royalty revenue was up about 30% in FY25, while aftermarket revenue fell by about $17 million due to lower CAT-related revenue, the end of a one-off licensing item, discontinued royalties, and hardware changes. Adjusted revenue included only $600,000 to $700,000 of a $10.2 million upfront statutory recognition tied to a minimum-guarantee royalty program that entered production in Q4 FY25. For FY26, management said there are 3 additional minimum-guarantee programs totaling $42 million, with about $1 million of adjusted revenue expected in the first half and $5.5 million in the second half. Paul McGlone said the company expects high double-digit revenue growth this year and margins north of 60%, while Martin Ive said the company is targeting cash flow breakeven run rate by the end of calendar 2025, positive cash generation in the second half of FY26, and about $10 million of cash per quarter toward the end of 2026.

Paul McGlone’s tone was confident and strategic, emphasizing that the investment phase is largely complete and that scale benefits should now show through in R&D and operating costs. He framed Europe’s GSR regulation as the main growth catalyst for automotive royalties and described Guardian, aftermarket, and aviation as each having meaningful pipeline opportunity. He also highlighted Mitsubishi as more than a funding source, calling the relationship a gateway to adjacent markets such as insurance and smart factory.

Martin Ive focused on the bridge from FY25 to FY26: about 30% auto royalty growth in FY25, a decline in total revenue driven by roughly $16 million of lost Guardian and aviation revenue, and a roughly $17 million aftermarket decline from CAT-related and product-transition effects. He explained the accounting treatment for minimum-guarantee royalty deals, including $10.2 million recognized upfront in FY25 for one program and $42 million of additional minimum guarantees expected to enter production in FY26. On costs and liquidity, he said operating costs are down about $8.6 million from the December 2023 peak, cash ended June at just over $22 million, and the business is moving toward breakeven run rate by end-2025 with positive cash generation in the second half of FY26. He also said the company has started the process to secure additional debt facilities ahead of the Magna convertible note maturing in October 2026.

Analysts pressed management on whether Seeing Machines had lost BMW, whether Magna’s relationship changed after exclusivity ended, and whether the company can still win large aftermarket fleet contracts. Paul McGlone said losing one program is normal because OEMs often dual-source by generation, that the BMW-related win by a competitor was already in the forecast, and that the Magna relationship remains good with continued bidding for new business. He also said some new aftermarket deals are for fleets producing several thousand units per year on rolling 3- to 5-year contracts, which should be larger and more committed than the traditional aftermarket model. On China, he said current figures exclude China entirely and that a separate partner-led China strategy is being developed.