Q3 2025 Electrolux AB Earnings Call

Speaker #4: Sweden .

Ann-Sofi Jönsson: Welcome to the presentation of Electrolux Q3 report. I'm Ann-Sofi Jönsson, Head of Investor Relations and Sustainability Reporting. I'm here with our CEO Yannick Fierling and our CFO. We will run through the presentation and after that we will open up to.

Speaker #6: Welcome to the presentation of Electrolux Q3 report . I'm Ann-Sofi Jnsson , head of investor relations and sustainability reporting . I'm here with our CEO , Yannick Fallan and our CFO , Therese Filbey .

Speaker #6: We will run through the presentation, and after that, we will open up to the Q&A session. If you are viewing on the web, do feel free to put your questions in the chat throughout the presentation.

Therese Friberg: The Q&A session.

Ann-Sofi Jönsson: If you are viewing on the web, do feel free to put your questions in the chat throughout the presentation. With that, I hand over to Yannick.

Speaker #6: And with that , I hand over to Yannick .

Yannick Fierling: Thank you very much, Ann-Sofi. Good morning and good day to all of you. Very happy to be with you for this third quarter report. I will start with very general comments. I mean, growth is one of our strategic pillars and I'm very glad to say that we have been growing once again in the third quarter. We have been increasing our net sales by 4.6%, mainly driven by North America. I'm also very glad to share that we have been growing our market share in the three regions here with our main brands, Electrolux, AEG, and Frigidaire. We have been taking our operating margin to 2.8% with good progress on cost reduction. We have been adding to the SEK 2 billion we achieved in the first half of the year an additional SEK 800 million.

Speaker #7: Thank you very much . Anne-Sophie . Good morning and good day to all of you . Very happy to be with you for this third quarter report .

Speaker #7: I will start with a very general comment. I mean, growth is one of our strategic pillars, and I'm very glad to say that we have been growing once again in the third quarter.

Speaker #7: We have been increasing our net sales by 4.6% , mainly driven by North America , I'm also very glad to share that we have been growing our market share in the three regions here , with our main brands Electrolux AG and Frigidaire .

Speaker #7: We have been taking our operating margin to 2.8% with a good progress on cost reduction . We have been adding to the 2 billion we achieved in the first half of the year .

Speaker #7: An additional 800 million SEK and afterwards , I've been sharing with you in the last quarters the aim we have to get faster and more agile , moving forward , and I'm very glad to announce some organizational changes which will be putting us closer to the end consumer .

Yannick Fierling: I have been sharing with you in the last quarters the aim we have to get faster and more agile moving forward. I'm very glad to announce some organizational changes which will be putting us closer to the end consumer. Moving to the results, as I said, we have been growing our net sales by 4.6%, mainly driven by North America where we have been gaining in terms of shop floor spaces and we have been expanding in key channels like the contract channels in Europe, Asia-Pacific, Middle East, and Africa. We have been growing slightly in subdued market with quite a lot of price pressure in Latin America, strong results once again here, stable net sales on the back of a very strong and hot 2024.

Speaker #7: Moving to the results , as I said , I mean , we have been growing our net sales by 4.6% , mainly driven by North America , where we have been gaining in terms of shop floor spaces .

Speaker #7: And we have been expanding in key channels like the contract channels in Europe , Asia Pacific , Middle East and Africa . We have been growing slightly in subdued markets with quite a lot of price pressure in Latin America , strong results once again here .

Speaker #7: Stable net sales on the back of a very strong and hot 2024 . In terms of operating margin in the Ebit bridge , we had two positives , which were volume and mix , and these two positive were slightly offset by a price negative price development in terms of external factors .

Yannick Fierling: In terms of operating margin in the EBIT bridge, we had two positives which were volume and mix, and these two positives were slightly offset by a negative price development. In terms of external factors, as you can expect, we were hit mainly by tariff and currency. We are very glad to say that we made progress once again in terms of cost reduction by adding SEK 800 million on the SEK 2 billion we achieved in the first half of the year. Moving now to Europe, Asia-Pacific, Middle East, and Africa, again we had a slight organic growth in this quarter. We have been gaining market share with our two main brands, Electrolux and AEG, more than offsetting the ramp down we have on the Zanussi brand. Zanussi was an entry price point brand and we are focusing today on core and premium brands.

Speaker #7: As you can expect, we were hit mainly by tariffs and currency. We are very glad to say that we made progress once again in terms of cost reduction by adding 800 million SEK to the 2 billion SEK we achieved in the first half of the year.

Speaker #7: Moving now to Europe , Asia Pacific , Middle East and Africa again , we had a slight organic growth in this quarter . We have been gaining market share with our two main brands , select trucks and AEG .

Speaker #7: More than offsetting the ramp-down we have on the brand, Zanussi was an entry price point brand, and we are focusing today on core and premium brands.

Yannick Fierling: Quite a lot of pressure again in prices and we saw a negative price development on the operating income side of the equation, positive in terms of volume and mix. These positives were slightly offset by a negative price development. The region has been benefiting by a good effect on the cost reduction side of the equation, and we kept on investing in the marketing side of the equation, and that's pretty important because we launched major innovations especially in the kitchen area under AEG and Electrolux, and we are glad to be able to fuel these major innovations through marketing money. In terms of external factors, we had a negative impact of currency mainly driven by a weak Australian dollar. Again, in terms of market development, this picture is very similar to the one I have been showing in the last quarters.

Speaker #7: Quite a lot of pressure . Again in prices , and we saw a negative price development on the operating income side of the equation , positive in terms of volume and mix .

Speaker #7: But this positives were slightly offset by a negative price development . The region has been benefiting by a good effect on the cost reduction side of the equation , and we kept on investing in the marketing side of the equation .

Speaker #7: And that's pretty important because we launched major innovations , especially in the kitchen area . Under AEG and electronics , and we are glad to be able to fuel these major innovations through marketing money .

Speaker #7: In terms of external factors , we had a negative impact of currency , mainly driven by a weak Australian dollar . Again , in terms of market development , this picture is very similar to the one I have been showing in the last quarters .

Yannick Fierling: We had a positive development in Western Europe of 1%. Western Europe represents 80% of the total volume for the region and a minus 1% for East Europe flat. Here once again we are at minus 11% versus the third quarter 2019, back to levels we had in 2014. The construction market remains very subdued. I mean, we're hoping it to rebound in the coming months due to the lower interest rate, but we have not seen any sign of that in the third quarter. On the positive side of the question, I just want to underline that we saw some sign of recovery in the region in the month of September.

Speaker #7: We had a positive development in Western Europe of 1%. Western Europe represents 80% of the total volume for the region, and a minus 1% for Eastern Europe.

Speaker #7: Flat . And here once again we had -11% versus the third quarter 2019 . Back to levels we had in 2014 . The construction market remains very subdued .

Speaker #7: I mean , we're hoping it to rebound in the coming months due to the lower interest rate , but we don't say we have not seen any sign of that in the third quarter .

Speaker #7: On the positive side of the equation , I just want to underline that we saw some signs of recovery in the region in the month of September .

Yannick Fierling: We have been working very hard in the last month to really improve the brand image we have, defining more precisely the consumer targets we have, and clearly define an identity card for our three brands, Electrolux, AEG, and Frigidaire. I'm very glad to share with you one of the latest campaigns you have seen some just before we have been live. This campaign is called the Wash Life Balance, and it's featuring the product leadership we do have in care and garment care. We have been also very proud to announce the launch of our new dishwasher, the AEG Favorit dishwasher here, which has been focusing on fit, feel, and finishing. It has leadership in terms of perceived quality, and we're also leading in terms of energy consumption, noise level, and water consumption here. Let me share with you a short video. Moving now to North America.

Speaker #7: We have been working very hard in the last months to really improve the brand image. We have been defining more precisely our consumer targets.

Speaker #7: We have and clearly defined an identity card for our three brands Electrolux , AEG and Frigidaire . And I'm very glad to share with you one of the latest campaign you have seen some just before .

Speaker #7: We have been alive . This campaign is called The Wash Life Balance and it's featuring the product leadership . We do have in care and garment care .

Speaker #7: We have been also very proud to announce the launch of our new dishwasher , the AEG Favorit dishwasher . Here , which has been focusing on fill and finishing .

Speaker #7: It has leadership in terms of perceived quality , and we also leading in terms of energy consumption , noise level and water consumption .

Speaker #7: Here. Let me share with you a short video. Moving now to North America, we are glad to say that we have been growing significantly in North America.

Yannick Fierling: We're glad to say that we have been growing significantly in North America. We are announcing a double-digit growth in the third quarter here, thanks to again a higher penetration in terms of shop floor space and an announced presence in some of the channels we do have, like the contract channel here. We're not buying market share, we're increasing the presence we do have in the different channels. We had a positive price impact. We were actually positive on the three dimensions, volume, mix, and price in North America as you all know. I mean we are building our appliances in North America. We're one of the North American constructors here. The last tariff structure should certainly benefit the North American producers. Unfortunately, we have to say that we have not seen the expected price increase for imported goods coming from basically Asia in this third quarter.

Speaker #7: We are announcing a double digit growth in the third quarter here , thanks to , again , a higher penetration in terms of shop floor space and an enhanced presence in some of the channels we do have , like the contract channel here .

Speaker #7: We're not buying market share . We're increasing the presence . We do have in the different channels . We had a positive price impact .

Speaker #7: We were actually positive on the three dimensions volume , mix and price in North America . As you all know . I mean , we are building our appliances in North America , where one of the North American constructor and the last tariff structure should certainly benefit the North American producers .

Speaker #7: Unfortunately , we have to say that we have not seen the expected price increase for imported goods coming from Asia in this third quarter .

Yannick Fierling: We have been leading price increase and that's very important. I'm very proud to say that we have been covering the vast majority of the tariff impact through a price increase. It's a competitive situation. We have in front of us, we've in front of as well a pretty promotional time which will be a Black November in North America. However, I want to repeat that the last tariff structure should be benefiting for North American producers. Negative impact as well from a currency side of the equation with a weak dollar in this quarter. The picture about the market is very much unchanged versus last year. The market has been pretty resilient to the inflation we have seen in the market.

Speaker #7: We have been leading price increases, and that's very important. I am very proud to say that we have been covering the vast majority of the tariff impact through the price increase.

Speaker #7: So it's a competitive situation . We have in front of us . We've in front of as well , a pretty promotional time , which will be a Black November in North America .

Speaker #7: However, I want to repeat that. I mean, the last tariff structure should be benefiting from North American producers' negative impact as well.

Speaker #7: From a currency side of the equation, with a weak dollar in this quarter, the pressure about the picture, about the market, is very much unchanged versus last year.

Speaker #7: The market has been pretty resilient to the inflation we have seen in the market. Moving to Latin America here, almost flat organic growth in the region on the back of a very strong 2024.

Yannick Fierling: Moving to Latin America here, almost flat organic growth in the region on the back of a very strong 2024 where we had a heat wave and we're setting a significant level of air conditioning and refrigerator. Unfortunately, the summer is not very hot in 2025 here, which has been increasing slightly the stock level we have in products like air conditioning. The competitive pressure in the regions remains pretty high. However, we're delivering once again 5.7% in terms of EBIT. We had a bad impact in terms of currency because of the Argentinian peso and the Brazilian real. The Argentinian market is opening up, which means that we have a high level of import products, our imported products out of Asia.

Speaker #7: We had where we had a heat wave and we were selling a significant level of air conditioning and refrigerator . Unfortunately , the summer is not very hot in 2025 .

Speaker #7: Here, which has been increasing slightly. The stock level we have in products like air conditioning, the competitive pressure in the regions remains pretty high.

Speaker #7: However, we are delivering once again 5.7% in terms of EBIT. We had a bad impact in terms of currency because of the Argentinian peso and the resilient real.

Speaker #7: The Argentinian market is opening up , which means that we have a high level of import products . Our imported products , out of Asia .

Yannick Fierling: Cost reduction, we're glad to say that we're delivering once again SEK 800 million in the third quarter, which is taking the total amount to SEK 2.8 billion for year to date here. We're still confident to reach between SEK 3.5 and 4 billion cost reduction for the full year. This cost reduction is mainly driven by product redesign, better sourcing in terms of components and suppliers, higher level of efficiency in our factories, and a full leverage of our global scale as Electrolux. Next slide is a slide we're very proud about. In 2016, Electrolux has been funding the Food foundation here. The aim of this Food foundation is twice. The first one is to educate children and adults to eat in a more sustainable manner. We are also helping adults in need here by giving them cooking lessons given by chefs in the different regions.

Speaker #7: Cost reduction , we're glad to say that . I mean , we're delivering once again , 800 million in the third quarter , which is taking the total amount of 2.8 billion for year to date here .

Speaker #7: And we're still confident to reach between 3.5 and 4 billion cost reduction for the full year . These cost reduction is mainly driven by product redesign , a better sourcing in terms of components and suppliers , higher level of efficiency in our factories , and a full leverage of our global scale .

Speaker #7: As Electrolux . Next slide is a slide . We're very proud about in 2016 , Electrolux has been funding the food Foundation here , and the aim of this Food Foundation is is twice .

Speaker #7: The first one is to educate children and adults to eat in a more sustainable manner . But we're also helping adults in needs here by giving them a cooking lessons given by a chef in the different regions year to date , we have been educating more than 300,000 children and adults through the food Foundation , and we aim the target we do have by 2030 is to have more than 1 million people benefiting from this foundation .

Yannick Fierling: Year to date we have been educating more than 300,000 children and adults through the Food Foundation. The aim, the target we do have by 2030 is to have more than 1 million people benefiting from these foundations. With that, I'm passing it to Therese.

Speaker #7: With that, I'm passing it to Therese.

Therese Friberg: Thank you, Yannick. The organic sales growth that we had in the quarter of 4.6% generated a positive impact to earnings of SEK 384 million. This was mainly derived from volume, but we also had a positive mix contribution in the quarter. This was of course offsetting the slight reduction that we did see in price. We are continuing to invest in innovation and marketing, as mentioned by Yannick, to really support the strong product portfolio we have in the market. Cost efficiency was a saving of SEK 760 million in the quarter. I would also like to mention here that in the quarter we had the group common cost of SEK 50 million, which was SEK 84 million below last year. This is a result of cost containment, but also a result of some timing between the quarters. We have very significant negative external factors.

Speaker #6: Thank you Yannick .

Speaker #8: The organic sales growth that we had in the quarter of 4.6% generated a positive impact to earnings of $384 million. This was mainly derived from volume, but we also had a positive mix contribution in the quarter.

Speaker #8: And this was of course , offsetting the slight reduction that we did see in in price . We are continuing to invest in innovation and marketing .

Speaker #8: As mentioned by Yannick , to really support the strong product portfolio we have in the market , cost efficiency was a saving of 760 million in the quarter , and I would also like to mention here that in the quarter , we had the group common cost of 50 million SEK , which was 84 million below last year .

Speaker #8: And this is a result of cost containment, but also a result of some timing between the quarters. We have very significant negative external factors.

Therese Friberg: Of course, as you all know, the negative impact from tariffs, but also quite significant negative impact from currency in the quarter, mainly related to the weakening of the Argentinian peso, but also the strengthening of the Thai baht versus the U.S. dollar and the Australian dollar. The negative effect we have in acquisitions and divestments is related to the divestment of the water heater business in South Africa that we did last year. The operating cash flow was positive, SEK 600 million in the quarter, which was somewhat below last year. This is mainly a result of a negative impact, a larger negative impact in working capital compared to last year.

Speaker #8: Of course , as you all know , the negative impact from from tariffs . But also quite significant negative impact from currency in the quarter , mainly related to the weakening of the Argentinian peso .

Speaker #8: But also the strengthening of the Thai baht versus the US dollar and the Australian dollar . And the negative effect we have in acquisitions and divestments is related to the divestment of the water heater business in South Africa that we did last year .

Speaker #8: The operating cash flow was positive $600 million in the quarter, which was somewhat below last year. This is mainly a result of a negative impact.

Speaker #8: A larger negative impact in working capital compared to last year . This and this is attributed to one seasonal effect related to receivables that are usually increasing in the third quarter .

Therese Friberg: This is attributed to one seasonal effect related to receivables that are usually increasing in the third quarter, but this year increased even more substantially than a normal seasonality related to higher sales growth but also quite a strong September month, as Yannick also touched upon earlier. As you also know, we came into the third quarter with quite high inventory levels from the second quarter from a volatile market during the first half and also from that the Brazilian retailers were destocking during the first half or specifically in the second quarter. This in combination with weak or cooler weather in Latin America means that we're still sitting on some of that stock. As you know, we usually have a strong reduction of inventory in the fourth quarter according to our normal seasonality and this is what we are looking for as well this year.

Speaker #8: But this year increased even more substantially than a normal seasonality related to higher sales growth , but also quite a strong September month .

Speaker #8: As Yannick also touched upon earlier, as you also know, we came into the third quarter with quite high inventory levels from the second quarter due to a volatile market.

Speaker #8: During the first half , and also from that , the Brazilian retailers were destocking during the the first half , or specifically in the second quarter .

Speaker #8: And this in combination with the weak or cooler weather in Latin America , means that we're still sitting on some of that stock .

Speaker #8: As you know , we usually have a strong reduction of inventory in the fourth quarter , according to our normal seasonality . And this is what we are looking for as well .

Speaker #8: This year . CapEx , we are having slightly lower than last year . And then looking at our balance sheet and liquidity , we have a solid liquidity and a well balanced maturity profile in the quarter .

Therese Friberg: CapEx we are having slightly lower than last year, and then looking at our balance sheet and liquidity, we have a solid liquidity and a well-balanced maturity profile. In the quarter, we amortized long-term debt of around SEK 1 billion, and we issued three new bonds of a total of SEK 2.6 billion under our EMTN program, and this will mature in 2029. For the remainder of 2025, we have borrowings maturing of approximately SEK 1.9 billion, which we will finance from our existing liquidity. We increased the financial net debt slightly in the quarter, but we still have a solid liquidity of SEK 29.4 billion by the end of September, including revolving credit facilities. Of course, we don't have any financial covenants, and our target to maintain a solid investment-grade rating remains. With that, I hand back over to Yannick.

Speaker #8: We amortized long term debt of around 1 billion SEK and we the issued three new bonds of a total of 2.6 billion SEK under our Emtn program .

Speaker #8: And this will mature in 2029 . And for the remainder of 2025 , we have borrowings maturing of approximately 1.9 billion Swedish krona , which we will finance from our existing liquidity .

Speaker #8: We increased the financial net debt slightly in the quarter , but we still have a solid liquidity of 29.4 billion Swedish krona by the end of September , including revolving credit facilities .

Speaker #8: And of course , we don't have any financial covenants and our target to maintain a solid investment grade rating remains . And with that , I hand back over to Yannick .

Yannick Fierling: Thank you very much, Therese. I will now move to the outlook and the summary. During the quarter, the market demand in Europe increased slightly. Consumer demand continued to be predominantly replacement driven. In Asia-Pacific, consumer demand is estimated to have decreased slightly year over year. Promotional activity and competitive pressure increased across market. Geopolitical uncertainty negatively impacted consumer sentiment in Europe. This contributed to consumers continuing to shift to lower price points and postponing discretionary purchases. Demand for built-in kitchen products in Europe remains subdued. In a longer perspective, it is important to remember that the European market is on a 10-year low for full year 2025. We reiterate our neutral market outlook for core appliances in Europe and Asia-Pacific. During the quarter, consumer demand in North America remained resilient. Market price adjustments did not reflect the implemented U.S. tariff structure, and competitive pressure and promotional activity remained high.

Speaker #7: Thank you very much , Therese . I will now move to the outlook and the summary . During the quarter , the market demand in Europe increased slightly .

Speaker #7: Consumer demand continued to be predominantly replacement driven in Asia Pacific . Consumer demand is estimated to have decreased slightly year over year . Promotional activity and competitive pressure increased across markets .

Speaker #7: Geopolitical uncertainty negatively impacted consumer sentiment in Europe . This contributed to consumers continuing to shift to lower price points and postponing discretionary purchases .

Speaker #7: Demand for built in kitchen products in Europe remains subdued in a longer perspective , it is important to remember that the European market is on a ten year low for full year 2025 , we reiterate our neutral market outlook for core appliances in Europe and Asia Pacific during the quarter , consumer demand in North America remained resilient .

Speaker #7: Industry market price adjustments did not reflect the implemented US tariff structure and competitive pressure and promotional activity remained high . Demand continued to be mainly replacement driven and consumers continue to prefer lower price points for the full year .

Yannick Fierling: Demand continued to be mainly replacement driven, and consumers continue to prefer lower price points for the full year. Demand outlook, economic uncertainties, and inflation concerns risk having a dampened effect on consumer demand. Consequently, we maintain our outlook of neutral to negative market demand. Consumer demand is estimated to have increased in Latin America in the third quarter. Competitive pressure increased in the region, most notably in Argentina, where the strong growth was driven mainly by imported goods. Consumer demand grew in Brazil, although at a slower pace than in the first quarter 2024, mainly due to inflationary pressure and higher interest rates affecting consumer spending. These factors contributed to retail continuing to reduce inventories for a full year. We reiterate our outlook of neutral market demand for core appliances in the region.

Speaker #7: Demand outlook . Economic uncertainties and inflation concerns risk having a dampening effect on consumer demand . Consequently , we maintain our outlook of neutral to negative market demand .

Speaker #7: Consumer demand is estimated to have increased in Latin America , in the third quarter . Competitive pressure increased in the region . Most notably in Argentina , where the strong growth was driven mainly by imported goods .

Speaker #7: Consumer demand grew in Brazil , although at a slower pace than in the first quarter of 2024 , mainly due to inflationary pressure and higher interest rates affecting consumer spending .

Speaker #7: These factors contributed to retail continuing to reduce inventories for a full year. We reiterate our outlook of neutral market demand for core appliances in the region.

Yannick Fierling: Moving now to the outlook, we still expect the impact from volume, price, and mix to be positive for the year. Previously, price was estimated to be a main positive driver. Now the main driver is estimated to be growth in focus category. Because of the market dynamics in the third quarter, and especially the challenging price environment in North America, we reiterate that we expect investments, innovation, and marketing for a full year 2025 to increase. New product launches provide us with a great platform to continue driving growth in our focus categories. Our focus on reducing costs remains high, and we stick to the outlook of SEK 3.5 to 4 billion in earnings contribution from cost efficiency in the full year 2025, with product cost out being the main driver for the cost reduction.

Speaker #7: Moving now to the outlook . We still expect the impact from volume , price and mix to be positive for the year . Previously , price was estimated to be a main positive driver .

Speaker #7: Now the main drivers is estimated to be growth in focus category because of the market dynamics . In the third quarter and especially the challenging prices environment in North America , we reiterate that we expect investments , innovation and marketing for a full year 2025 to increase new product launches , provide us with a great platform to continue driving growth in our focus categories .

Speaker #7: Our focus on reducing costs remains high, and we stick to the outlook of $3.5 to $4 billion in earnings contribution from cost efficiency for the full year 2025, with product cost reduction being the main driver for the cost reduction.

Yannick Fierling: External factors are expected to be significantly negative for the full year because inflation related to increased tariff is included in external factors in our EBIT bridge. Currency remains a headwind, and the impact from raw material cost is expected to be slightly positive for the year. For the full year, we are lowering our outlook for capital expenditure from SEK 4 to 5 billion to approximately SEK 3.5 to 4 billion. Investments to strengthen our competitiveness through innovation and manufacturing efficiency are essential to support growth and improving efficiency. We are also looking at being as efficient as possible and scrutinizing our priorities. These resulted in a lower CapEx outlook. Moving now to the strategy, and I think we have been hammering that’s our five strategic pillars, and we are improving on all of them here.

Speaker #7: External factors are expected to be significantly negative for full year . The cost inflation related to increased tariff is included in external factor in our Ebit bridge .

Speaker #7: Currency remains a headwind, and the impact from raw material costs is expected to be slightly positive for the year. For the full year, we are lowering our outlook for capital expenditure from $4 to $5 billion to approximately $3.5 to $4 billion. Investments to strengthen our competitiveness through innovation and manufacturing efficiency are essential to support growth and improve efficiency.

Speaker #7: But also we are looking at being as efficient as possible . We can and as criticizing our priorities . These resulted in a lower CapEx outlook .

Speaker #7: Moving now to the strategy, and I think we have been hammering that; our five strategic pillars, and we are improving on all of them here.

Yannick Fierling: In terms of North America, we have been increasing our market share, we have been increasing the penetration level we have in key channels, and we have been increasing the number of shop floor spaces we have thanks to innovation like the stone bake pizza feature we presented last month. In terms of growth, we are growing in a challenging market. We are growing in core and premium segments with our brands like Electrolux and in AEG. We keep a very strong position in Latin America. The organic growth has been at the same level as last year, but again it was on the back of a very strong 2024. We have been launching very strong innovations in kitchen in Europe, in North America with a big kitchen bake oven, and we have product leadership in Latin America.

Speaker #7: In terms of North America, we have been increasing our market share. We have been increasing the penetration level we have in key channels.

Speaker #7: We've been increasing the number of shop floor spaces. We have, thanks to innovations like the stone-baked pizza feature we presented last month.

Speaker #7: In terms of growth, we are growing in a challenging market. We're growing in core and premium segments with our brands like Electrolux and AEG.

Speaker #7: We keep a very strong position in Latin America . The organic growth has been at the same level as last year , but again , it was on the back of a very strong 2024 .

Speaker #7: We have been launching very strong innovations in kitchen in Europe , in North America with a big kitchen bake oven , and we have product leadership in Latin America .

Yannick Fierling: We made progress in terms of cost reduction, adding again SEK 800 million on the SEK 2 billion we have been achieving in the first half of the year. Last but not least, the environment is changing. We are in a very unstable market right now where we need to react very fast. We need to be better in terms of speed and agility, and that’s why we’re driving organizational changes, increasing customer centricity. The first announcements we’re making today is we will be splitting Europe, Middle East and Africa and APAC in two different regions, two commercial regions. One will be focusing on Europe, Middle East and Africa, and the other one will be focusing on APAC. As a result, Anna Olsson will be leaving the company. Leonardo Djashioca, who is currently leading the Latin America region, will be moving to Europe and he will be heading the region.

Speaker #7: We made progress in terms of cost reduction , adding again 800 million on the 2 billion . We have been giving in the first half of the year .

Speaker #7: And last but not least , the environment is changing . We are in a very unstable market right now . Where we need to react very fast .

Speaker #7: We need to be better in terms of speed and agility , and that's why we're driving organizational changes , increasing customer centricity . The first announcements we're making today is we will be splitting Europe , Middle East and Africa .

Speaker #7: And APAC in two different regions . Two commercial regions . Once we'll be focusing on Europe , Middle East and Africa . And the other one will be focusing on APAC as a result .

Speaker #7: Anna Olson will be leaving the company . Leandro Jasrotia , who is currently leading the Latam region , will be moving to Europe and he will be heading the region .

Yannick Fierling: Patrick Minogue will be replacing Ricardo Kunst, who decided to retire from the company pursuing a family journey he has been starting, and Eduardo Melo will be replacing Leandro Socia at the head of Latin America. We're sure that with these organizational changes we will be increasing speed, agility, and be more consumer centric moving forward. That's concluding this presentation and we'll be happy to take any questions.

Speaker #7: Patrick Minogue will be replacing Riccardo , who decided to retire from a company pursuing a family journey . He has been starting . And Eduardo Melo will be replacing Leandro at the head of Latin America .

Speaker #7: We are sure that with these organizational changes we will be increasing speed , agility and being more consumer centric . Moving forward . That's concluding this presentation and we'd be happy to take any questions .

Ann-Sofi Jönsson: Great, thank you Yannick and Therese. With that, we will move over to the participants on the telephone conference.

Speaker #6: Great . Thank you Yannick , and Therese . With that , we will move over to the participants on the telephone conference . So , Sarah , you could please go ahead and open up for questions .

Therese Friberg: Sarah, you could please go ahead.

Ann-Sofi Jönsson: will open up for questions.

Therese Friberg: Thank you.

Speaker #9: Thank you . If you would like to ask a question over the phone lines , you will need to press star one and one on your telephone and wait for your name to be announced .

Ann-Sofi Jönsson: If you would like to ask a question over the phone lines, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, you can press star one one again. Alternatively, if you wish to ask questions via the webcast, please type it into the box and click submit. We will now take our first question from the phone lines, and this is from Gustav Aguias from SEB. Please go ahead.

Speaker #9: And to withdraw your question . You can press star one one again . Alternatively , if you wish to ask questions via the webcast , please type it into the box and click Submit .

Speaker #9: We will now take our first question from the phone lines, and this is from Gustavo Aguilar from CIB. Please go ahead.

[Analyst 1]: Thank you. Good morning. Congrats on a good result. If I may start on the comment on the U.S. market share gains and as you mentioned you take shelf space in the quarter. It appears as if you've had now four quarters in a row with some market share gains in the U.S., obviously superseding a period where you've lost some market shares. Interesting to hear now that you're starting to meet a little bit tougher comps in terms of market shares in the U.S. If you see this trend potentially continuing into Q4 and into next year and if you could shed some light on who you're taking shelf space from, maybe not the name, but if it's domestic or non-domestic players, or if it's private label or how you view that dynamic in the trade, that would be interesting to hear. Thanks.

Speaker #10: Thank you . Good morning . Congrats on a good result for me . Start on the comment on the on the US market share gains .

Speaker #10: And as you mentioned , you take shelf space in the quarter . It appears as if you've had now four quarters in a row with some market share gains in the US .

Speaker #10: Obviously superseding a period where you've lost some market share . So interesting to hear now that you're starting to to meet a little bit tougher comps in terms of market shares in euros .

Speaker #10: If you see this trend potentially continuing into Q4 and into next year , and if you could shed some light on who you're taking shelf space from , maybe not the name , but if it's domestic or non-domestic players or if it's private label or how you view that dynamic in the trade , that would be interesting to hear .

Speaker #10: Thanks .

Yannick Fierling: Thanks for the question, Gustav. I think we're taking share, I would say across and I think it's mainly due to, and thanks to the innovation we have been launching mainly in kitchen. Let's not forget as well that we have been ramping up Springfield in the last month here. We have been launching Fuji's Ramp Up, a new series of cooking products, for instance, which are feeding brands like Frigidaire, Gallery and Pro. We have been launching the great innovation which is the Pizza Stone Beethoven in North America here, which has been getting an excellent reception in the market. We have some new products as well in the food preservation side of the equation. It is really across market share here.

Speaker #7: Thanks for the question , Gustav . I think we're taking a share . I would say across and I think it's mainly due to and thanks to the innovation we have been launching , mainly in kitchen .

Speaker #7: Let's not forget as well that we have been ramping up Springfield in the last months here . We have been launching for this ramp up a new series of cooking products .

Speaker #7: For instance , which are feeding brands like Frigidaire Gallery and Pro . We have been launching the great innovation , which is the pizza Stone bake in North America here , which has been getting an excellent reception in the market .

Speaker #7: We have some new products as well in the food preservation side of the equation. So it is really a market share here.

Yannick Fierling: We have been entering, and I want to make sure everybody understands we are not buying market share, but we have been entering into new channels like the contract channels here and we have been really gaining shop floor spaces with our main customers, I mean Lowe's, Home Depot and Best Buy and others here in the last months. It's not one specific competitor we're taking share from, but it's a wide range of competitors.

Speaker #7: We have been entering , and I want to make sure everybody understands we are not buying market share , but we have been entering into new channels like the contract channels here .

Speaker #7: And we have been really gaining shop floor spaces in with our main customers . I mean , those Home Depot and Best Buy and others are here in the last months .

Speaker #7: So it's not one specific competitor we’re taking share from, but it's a wide range of competitors.

[Analyst 1]: The second part of that question, as you look into it, appears as if comps on the market share gains in the U.S. are a little bit tougher to meet. Now, as you enter Q4 into 2026, should we expect this trend to continue with some recovery of the market shares also at the end of 2026?

Speaker #10: And the second part of that question , as you look into it , appears as if comps on the market share gains in US is a little bit tougher to meet .

Speaker #10: Now , as you entered Q4 into 2026 , should we expect this trend to continue with some recovery of the market share is also , as you enter 2026 ?

Yannick Fierling: Yeah, I think I would like to make two points going into the volume side of the equation. First, I want to insist on that. I mean that was our commitment. We have been leading price increase in North America in the last month, and that has certainly not been easy. I think we were very fortunate to have all these innovations in order to compensate basically for this price increase because we are producing, as you know, in North America. We're among the three producers in North America, and the last tariff structure introduced at the beginning of the summer was certainly privileging or benefiting North American producers. We were expecting a high level of pricing freeze for imported goods, especially coming out of Asia. Unfortunately, I have to say today that we did not see that happening.

Speaker #7: Yeah , I think I would like to make two points going into the volume side of the equation . First , I want to insist on that .

Speaker #7: I mean , that was our commitment . We have been leading price increase in North America in the last months , and that has certainly not been easy .

Speaker #7: And I think we were very fortunate to have all these innovations in order to compensate basically for this price increase , because we are producing , as you know , in North America , we're among the three producers in North America .

Speaker #7: And the last tariff structure introduced at the beginning of the summer was certainly privileging or benefiting , benefiting North American producers . So we were expecting a high level of price increase for imported goods , especially coming out of Asia .

Speaker #7: Unfortunately , I have to say today that we did not see that happening , and I think we're entering into a promotional season in North America now with a Black November .

Yannick Fierling: I think we're entering into a promotional season in North America now with Black November. However, what I want to underline as well is that, I mean, midterm, there is absolutely no doubt that North American producers will be benefiting from the current tariff structure here and that import products will be handicapped significantly and will have to increase prices. We did not see that in the third quarter. We're entering into, of course, a promotional period which is Black November here. There is also no doubt in our mind that, I mean, the current tariff structure should be benefiting basically North American producers amongst who we are. We're not giving up on prices, not at all here. We're just expecting the market to be rational in North America as well.

Speaker #7: However , what I want to underline as well is that , I mean , mid-term , there is absolutely no doubt that I mean , North American producers will be benefiting from a current tariff structure here .

Speaker #7: And that import of new products will be handicapped significantly, and we'll have to increase prices. So we did not see that in the first quarter.

Speaker #7: We entering into , of course , a promotional period , which is Black November here . But there is also no doubt in our mind that the current tariff structure should be benefiting .

Speaker #7: Basically , North American producers amongst who we are . We're not giving up on prices , not at all . Here . We're just expecting the market to be rational .

Speaker #7: In North America as well .

Therese Friberg: I guess a little bit more overall, of course, some of the effects that Yannick talked about with gaining additional shop floor and gaining traction within the contract channels, of course, this is not something that is just happening on and off. We believe that those types of changes are structural changes that have come gradually during this year, which of course also should continue to be a positive going forward.

Speaker #8: And I guess a little bit more overall . Of course , some of the effects that Jannick talked about with gaining additional shop floor and gaining traction within the contract channel , of course , this is not something that is just happening on and off , but we believe that those types of changes are structural changes that has come gradually during this year , which of course also should continue to be a positive going , going forward .

[Analyst]: Thanks, Teres.

Speaker #11: Thanks , Tess .

[Analyst 1]: Thanks, Therese. If I may ask one question on Europe too, interesting to hear that you see some improvement in September in terms of market volumes. If I understood you correctly, companies tend not to raise these types of monthly data towards the end of the quarter if they haven't seen a similar pattern going into the month that we're in now. Is there any reason to assume that logic would not apply to you, that October would not follow the September trend? Appreciated.

Speaker #10: Thanks . Cheers . And Yannick . And if I may ask one question on Europe to it's interesting to hear that you see some improvement in September in terms of market volumes .

Speaker #10: If I understood you correctly , companies tend not to to raise these type of monthly data . Towards the end of the quarter .

Speaker #10: If they haven't seen a similar pattern going into to the to the month that we're in now , is there any reason to assume that that logic would not apply to you , that that October would not follow the September trends ?

Speaker #10: Appreciate . It's just one month ?

Yannick Fierling: Yeah, I think that's a great question. Unfortunately, in all fairness, if you look at full 2025, we have not been going through normal type of patterns in most of the regions, especially in Europe. Indeed, I think we're happy to say that September, and we have been mentioning, has been a positive month here for us. I think what we wish is that it would be continuing in the fourth quarter. The level of unpredictability and uncertainty we do have in the market today in Europe is pretty high. I would say it's difficult to say, certainly. We're entering as well into a Black November type of market in Europe. We are confident that we have a product. We have been introducing the innovation we have been introducing with the plan we have in place.

Speaker #7: Yeah , I think that's a great question . Unfortunately , in all fairness , I mean , if you look at through 2025 , I mean , we have not been going through normal type of patterns in most of the regions , but especially in Europe .

Speaker #7: Indeed , I mean , and I think we're happy to say that , I mean , September and we have been mentioning has been a positive month here for us .

Speaker #7: And I think all we wish is that it will be continuing in the fourth quarter . But , I mean , the level of unpredictability and uncertainty we do have in the market today in Europe is pretty high .

Speaker #7: So it's I would say it's difficult to say certainly . I mean , we're entering as well into a black November type of market in Europe , but we are confident that with a product we have been introducing the information we have introducing with the plan we have in place .

Yannick Fierling: I think the quality of the people we have facing the end consumer, we will be doing the right thing for what we can control. Unfortunately, the level of uncertainty is pretty high in the market.

Speaker #7: And I think the quality of the people we have facing the end consumer . I mean , we will be doing the right thing for what we can control , but unfortunately , I mean , level of uncertainty is pretty high in the market .

[Analyst 1]: I appreciate that, but the question was specific in October. Is there any reason to assume that the trend reversed again in October?

Speaker #10: I appreciate that , but the question was specifically in October , is there any reason to assume that the trend reversed again in October ?

Yannick Fierling: I think I cannot give you any trend, of course, for October right now, but certainly, the fact that September was a positive month is certainly a good indication for us.

Speaker #7: I think I cannot give you any trend , of course , for October right now , but certainly I mean , the fact that in September was was a positive month is certainly a good indication for us .

Speaker #8: And this is also an .

Speaker #10: Important .

Therese Friberg: This is also an important point when thinking about cash flow because as you've seen, we had a weaker cash flow this quarter compared to last year, where a large part of this is really related to that. We are tying up quite a lot more in receivables this year compared to last year. This is really driven by that. The September month was the very strong month in sales and hence we are tying up larger amount in receivables. We don't see any changes in terms either in receivables or in payables. It's important to understand that effect from a cash flow perspective.

Speaker #8: And this is also an important point when thinking about cash flow , because as you've seen , we had a weaker cash flow .

Speaker #8: This quarter compared to last year , where a large part of this is really related to that . We are tying up quite a lot more in receivables this year compared to to last year .

Speaker #8: And this is really driven by that . The September month was the very strong month in in sales , and hence we're tying up larger amount in receivables .

Speaker #8: So we don't see any changes in terms either in receivables or in , in payables . So it's important to understand . Yeah .

Speaker #8: That effect from a cash flow perspective .

[Analyst 1]: That's a good clarification. Thank you.

Speaker #10: That's a good clarification . Thank you guys .

Ann-Sofi Jönsson: Thank you. We'll now take the next question from the phone lines. This is from John Kim from Deutsche Bank. Please go ahead.

Speaker #9: Thank you . Well I'll take the next question from the phone lines . And this is from John Kim from Deutsche Bank . Please go ahead .

[Analyst]: Hi, good morning. Thanks for the opportunity. Two questions, if I may. Can you comment on what you're seeing in North America in terms of any potential inventory overhangs? My understanding is that some of your foreign competitors put extra inventory into the market ahead of anticipated tariff-driven price increases. I'm just wondering how that's absorbing.

Speaker #12: Hi . Good morning . Thanks for the opportunity . Two questions , if I may . Can you comment on what you're seeing in North America in terms of any potential inventory overhangs ?

Speaker #12: My understanding is that some of your foreign competitors put extra inventory into the market and ahead of anticipated tariff tariff increases . I'm just wondering how that's absorbing .

Yannick Fierling: John, thanks for your question here. I will just be repeating the answer I gave last quarter, which is again a very transparent answer. The fact that we may have some of our competitors preloading in order to avoid tariff seems to be logical. However, we did not observe this phenomenon ourselves here. I think this phenomenon was not reported to us by our team basically in North America. Unfortunately, again, logical, but it is something we cannot confirm.

Speaker #7: John , thanks for your question . Here , and I will just be repeating the answer I gave last quarter , which is I again , a very transparent answer .

Speaker #7: I mean , the fact that , I mean , we may have some of our competitors pre-loading in order to avoid tariff seems to be logical .

Speaker #7: However , we did not observe this phenomenon ourselves here , and I think these phenomenon was not reported to us by our team .

Speaker #7: Basically , in North America . So unfortunately , I mean , again , logical , but I mean it is something we cannot confirm .

[Analyst]: Okay. I was wondering if you could give us a little bit more color on the reorganization, particularly on the split on your what looks like EMEA Asia-Pacific into different regions. Thanks.

Speaker #12: Okay . And I was wondering if you could give us a little bit more color on the reorganization , particularly the split on on what looks like a major pack into different regions .

Speaker #12: Thanks .

Yannick Fierling: Yeah, absolutely. I think again, the aim we have in terms of organizational setup is really to get closer to the end consumer from the top to about to reverse basically the organizational pyramid here and have the entire organization supporting what we'll be delivering to the market. Having the Asian organization below the European region has been adding one layer. What we want to do here is to be able to respond in a faster manner, in a more agile manner to the needs our customers do have as well in the Asia-Pacific region. That's why we have been carving out this commercial region. We will have the head of this commercial region, which will be reporting directly to myself, the CEO here. I think with this setup we're convinced that we would be able to support again the region in a better manner.

Speaker #7: Yeah , absolutely . I think again , we we aim we have in terms of organizational setup is really to get closer to the end consumer from the top to the reverse .

Speaker #7: Basically the organization pyramid here . And I have the entire organization supporting what would be delivering to the market , having the Asian organization below the European region .

Speaker #7: I mean , has been adding one layer . What we want to do here is to be able to respond in a faster manner and a more agile manner to the needs of our customers .

Speaker #7: Do have as well in the Asia Pacific region . And that's why we have been carving out this commercial region . We will have ahead of this commercial region , which will be reporting directly to myself , the CEO here , and I think with this setup , we're convinced that we will be able to support again the region in a better manner .

Therese Friberg: Maybe one clarification from an external reporting perspective, we will still hold it together from a back end perspective across Europe, Middle East, Africa, and Asia-Pacific. It will really be a commercial region. Externally, we will continue to have the same segment reporting as today.

Speaker #8: And maybe .

Speaker #12: From .

Speaker #8: Maybe one clarification from an external reporting , we will still hold it together from a back end perspective across Europe , Middle East , Africa and Asia Pacific .

Speaker #8: So it will really be a commercial region . So externally we will continue to have the same segment reporting as today .

Yannick Fierling: Thanks, Taz.

Speaker #11: Thanks , Tess .

[Analyst]: Okay, thanks for the clarification.

Speaker #12: Okay . Thanks for the clarification .

Ann-Sofi Jönsson: Thank you. Next question today is from Akash Gupta, J.P. Morgan. Please go ahead.

Speaker #9: Thank you . Next question today is from Akash Gupta JP Morgan . Please go ahead .

Yannick Fierling: Yes.

[Analyst 2]: Hi, good morning. Thanks for your time. I have a few as well. The first one is on again going back on North America. One of your North American competitors mentioned earlier this week that they produce about 80% of their appliances in the region. If I may ask, what's the share of your local production in North America and how does that compare with industry average if we have that figure?

Speaker #13: Yes . Hi . Good morning . Thanks for your time . I have a few as well . And the first one is on again .

Speaker #13: Going back on North America, one of your North American competitors mentioned earlier this week that they produced about 80% of their appliances in the region.

Speaker #13: And if I may ask if what's the share of your local production in North America ? And how does that compares with industry average ?

Speaker #13: If we have that figure .

Yannick Fierling: Okay, thanks for the question. Without giving any precise number here, what I can tell you however is that we have five factories in North America, three in the U.S. and two in Mexico who are USMCA here. The vast majority of our products are produced in North America today and again are USMCA compliant. We are among the three major North American producers for appliances here. Certainly, as I said previously, long term, if the industry is behaving rationally, we should be benefiting from the latest tariff structure here. Unfortunately, that's not what we saw in the third quarter here because we did not see a price increase from import finished goods. In all fairness, the full tariff structure would be implemented beginning of October.

Speaker #11: Okay . Thanks .

Speaker #7: For the question . Without giving any precise number here , what I can tell you , however , is that we have five factories in North America , three in the US and two in Mexico who are Usmca here .

Speaker #7: So the vast majority of our products are produced in North America today . And again , Aosmc compliant . So we are among the three major North American producers for appliances here .

Speaker #7: And certainly , as I said previously , long term . And if the industry is behaving rationally , we should be benefiting from the latest tariff structure here .

Speaker #7: Unfortunately, that's not what we saw in the third quarter. Here, we did not see a price increase from imported finished goods.

Speaker #7: Now , in all fairness , I mean , the full tariff structure would be implemented beginning of October . So it would be interesting to witness what would be the movements in in the coming quarter , knowing again that we have Black November in front of us .

Yannick Fierling: It would be interesting to witness what will be the movements in the coming quarter, knowing again that we have Black November in front of us.

Therese Friberg: I think what we have said is that with the competitor you are referring to, we have a relatively similar footprint. That we have been clear.

Speaker #8: And I think what we have said is that with the competitor , you are referring to , we have a relatively similar footprint .

Speaker #8: So that we have been clear with .

[Analyst 2]: Thank you. My second one is on the cost savings. You had SEK 2.8 billion in the first nine months, SEK 800 million in the third quarter. Your target is SEK 3.5 to 4 billion. That would imply SEK 700 million to 1.5 billion in Q4. I think in Q4 you have a very tough comp because last year half of the savings came in Q4 alone. Any indication where are we trending towards in this SEK 3.5 to 4 billion range for cost savings this year?

Speaker #13: Thank you . And my second one is on the cost savings . You had 2.8 billion in the first nine months . And 800 million in third quarter .

Speaker #13: And your target is 3.5 to 4 billion . That would imply 700 to 1.2 billion in Q4 . But I think in Q4 you have a very tough comp because last year , half of the savings came in Q4 alone .

Speaker #13: So any indication like where are we trending towards this in this 3.5 to 4 billion range for cost savings this year ?

Yannick Fierling: Yeah, a couple of stuff, Kashi. The first one, I mean we explained that. I mean it's very difficult to compare the SEK 4 billion we delivered last year with SEK 3.5 to 4 billion we're delivering this year. Because last year, I mean the saving was for a big part coming from restructuring we have been doing in the past. The SEK 3.5 to 4 billion we're delivering in 2025 are much more coming from product redesign, better component sourcing, higher efficiency in terms of factory, and better leverage of our global scale here. All what I can tell you today is that we are confident to deliver between SEK 3.5 and 4 billion for 2025.

Speaker #11: Yeah , a couple of stuff .

Speaker #7: Actually . The first one , I mean , we explained that , I mean , it's very difficult to compare the 4 billion we delivered last year with a 3.45 to 4 billion were delivering this year because last year , I mean , the saving was for a big part coming from restructuring .

Speaker #7: We have been doing this in the past. The $3.5 to $4 billion will be delivered in 2025. I'm much more focused on product redesign, better component sourcing, higher efficiency in terms of factories, and better leverage of our global scale.

Speaker #7: Here . All what I can tell you today is that we are confident to deliver between 3.5 and 4 billion for 2025 .

[Analyst 2]: My last one is on free cash flow. You don't provide bridge like some of your competitors, but when we look at this change in CapEx outlook which you have cut today, would that change your internal assumptions for full year free cash flow? Are there any other elements like working capital or something else that might offset? Any commentary on your own expectations for free cash flow? Does that change after the CapEx outlook?

Speaker #13: And my last one is on free cash flow . And so again , I mean , you don't provide bridge like your some of your competitors , but when we look at this change in CapEx outlook , which you have cut today , would that change your internal assumptions for full year free cash flow or are there any other element like working capital or something else that might .

Speaker #13: Offset ? So any commentary on your own expectations for free cash flow ? Does that change after the CapEx outlook update ?

Therese Friberg: No, I would say that those are disconnected. With the CapEx refocus that we've done, of course we continuously do prioritization and reprioritization, and with the focus that we have on cost reduction, actually that is also spilling over on the CapEx reduction. When we're looking at cost, we're also looking at how we buy equipment and so forth. We're not doing the CapEx reduction really to offset other negatives in our cash flow. Those are disconnected.

Speaker #8: No , I would say that those are disconnected . So with CapEx refocus that that we've done , of course , we continuously do prioritization and reprioritization .

Speaker #8: And with the focus that we have on cost reduction , actually , that is also spilling over on the CapEx reduction . So of course , when we're looking at cost , we're also looking at how we buy equipment and , and and so forth .

Speaker #8: So we're not doing the CapEx reduction really to offset under other negatives in our our cash flow . Those are disconnected .

Yannick Fierling: That's very important to underline until I said it. I mean we're not delaying any launches, we're not delaying any programs, we're not delaying any footprint or whatever here. What we have been doing is, I mean we're using, we have been using our CapEx in a better manner in 2025 here and as you know we have been hiring about a year ago now a new CPU and I think we have been really focusing on buying better, cheaper from best cost countries in 2025 and that's reflected in the cost saving we're having but also on how we are purchasing equipment and tooling.

Speaker #11: That's very .

Speaker #7: Important to underline . And I said it , I mean , we are not delaying any launches . We're not delaying any programs .

Speaker #7: We're not delaying any footprint or whatever here . What we have been doing is I mean , we're using we have been using our CapEx in a better manner in 2025 here .

Speaker #7: And as you know , we have been hiring about a year ago now , a new CPO . And I think we have been really focusing on on buying better , cheaper from best cost countries in 2025 .

Speaker #7: And that's reflected in the cost savings we're having . But also on how we are purchasing equipment and tooling .

[Analyst 2]: That's fair. I mean in theory, if your free, if your CapEx is going down and keeping everything else equal, your free cash flow should be better than before. My question was that is this the case that now we should expect, keeping everything as equal, a better free cash flow or is there anything that might offset this benefit that you may get from lower CapEx?

Speaker #13: I mean , that's fair , but I mean , in theory , like if you're if your CapEx is going down and keeping everything else equal , your free cash flow should be better than before .

Speaker #13: So my question was that , is this the case that now we should expect keeping everything as equally better free cash flow ? Or is there anything that might be offset this benefit that you may get from lower CapEx ?

Therese Friberg: I guess it depends on the time frame you are looking at. Of course, as we have been transparent about, we are not having a strong cash flow this quarter as we did last year, and of course also year to date we have a weaker cash flow than last year. The reductions we're doing in CapEx are not to compensate for the negative effects that we have been seeing in working capital. As we also said earlier, one part of that is really temporary or seasonal. We had a strong September with the receivables being negative in the quarter, more negative than last year and more negative than usual seasonality, of course inventory.

Speaker #8: I guess it depends on the time frame . You you are looking at . Of course , as we have been transparent about , we are not having a strong cash flow this quarter as we did last year .

Speaker #8: And of course , also year to date . We have a weaker cash flow than than last year . But the reductions we're doing in CapEx are not to compensate for for the negative effects that we have been seeing in in working capital .

Speaker #8: Of course , as we also said , the earlier one part of that is really temporary or seasonal that we had a strong September with receivables being negative than in the quarter , more negative than than last year and more negative than the usual seasonality .

Speaker #8: Of course , inventory . We have also been clear with that . It is on a higher level already . When we came in to to the second quarter and we are usually having a seasonality where we have large inventory reductions towards the end of the year .

Therese Friberg: We have also been clear that it is on a higher level already when we came into the second quarter, and we are usually having a seasonality where we have large inventory reductions towards the end of the year, and this is what we are expecting as well this year. Maybe one additional point that we didn't touch upon. This is not related to the CapEx, but if you look at the full free cash flow for the year, we have talked about earlier in the second quarter that the impact of tariffs is also impacting the working capital level. Since the terms of when you are having to pay for tariffs compared to when you're able to then reclaim them from price increases from the retailers, there is a time gap. We have been clear with that.

Speaker #8: And this is what we are expecting as well . This year , maybe one additional point that we didn't touch upon . Again , this is not related to the CapEx .

Speaker #8: But if you look at the full free cash flow for the year , we have talked about earlier in the second quarter that the impact of tariffs is also impacting the working capital level since the terms of when you are having to pay for for tariffs compared to when you're able to , then reclaim them from price increases from the retailers , there is a time gap .

Speaker #8: So, of course, we've been clear with that. Structurally, we have had a negative impact from that in our cash flow in the year.

Therese Friberg: Structurally, we have had a negative impact from that in our cash flow in the year.

[Analyst 2]: Thank you Therese and Yannick.

Speaker #13: Thank you , Theresa and Yannick .

Yannick Fierling: Thank you.

Ann-Sofi Jönsson: Thank you. Just before we take our next question, we will please ask participants to limit themselves to two questions. Thank you. We will now move to the next question and this is from Johan Eliasson from SB1 Markets. Please go ahead.

Speaker #11: Thank you .

Speaker #9: Thank you . I just before we take our next question , we will please ask participants to limit themselves to two questions . Thank you .

Speaker #9: We will now move to the next question, and this is from Johan Eliasson from SB One Markets. Please go ahead.

[Analyst 3]: Bonjour Yannick, Therese and Ann-Sofi, thanks for taking my question. I was wondering once again, North America, you say you are taking market share there. The brand you have in North America, Frigidaire, is typically a mass market brand which historically has sort of gained share when the consumers become more price conscious. Is that part of what we've seen over there? Could you also update me on how the progress is developing, you know, moving your price points on the brand towards the higher price points like the Frigidaire Gallery issue that you have been focused on over the past few years? Would you say that you have been able in general to move up the brand a bit on the pricing level? Thank you.

Speaker #6: Theresa and Sophie , thanks for taking my question . I was wondering once again , North America , you say you are taking market share there .

Speaker #6: The brand you have in North America . There is typically a mass market brand which historically has sort of gained share when when consumers become more price conscious .

Speaker #6: Is that part of what we've seen over there ? And could you also update me on on how the progress is developing ? You know , moving your .

Speaker #6: Price points on the brand towards the higher price points like the Frigidaire Gallery issue that you have been focused on over the past few years , would you say that that you have been able in general to to move up the brand a bit on the on the pricing ladder ?

Speaker #6: Thank you .

Yannick Fierling: Thank you very much for your question and absolutely, I mean for the first questions, we are not targeting opening price point with Frigidaire and that's exactly how we have been mixing up with Gallery and Paul. In all fairness, the entire strategy developed for the last years as well with factories like Springfield or Anderson has been to mix up and have a higher offer in terms of products for Gallery and Paul. I just want to give you very concrete examples. Back command on oven ranges are usually low end. Most of the products we do have now, a big part of it out of Springfield, has front commands here which is more mid to high end segments here. I could give you similar example on the Anderson side of the equation.

Speaker #7: Thank you very much for for your question . And yeah , absolutely . I mean , for the first questions , we are not targeting opening price point with Frigidaire .

Speaker #7: And that's exactly how we have been mixing up with Gallery and Pro . And in all fairness , the entire strategy developed for the last years as well , with factories , Springfield or Anderson , have been to mix up and have a higher offer in terms of .

Speaker #7: products for gallery . And I just want to give you very concrete examples . I mean , back command on on oven ranges are usually low end .

Speaker #7: I mean, most of the products we do have now are a big part of it. Out of Springfield, we have front commands here, which is more in the mid to high-end segments here.

Speaker #7: I could give you a similar example on the other side of equation , the pizza stone bake oven is again a feature which is a big innovation .

Yannick Fierling: The Pizza Stone Bake Corbin is again a feature which is a big innovation and we're pricing for this innovation as well in North America. No, we're not fighting really for opening price points on strategy there. We're not buying market share. What we're really doing is, we're occupying new shop floor spaces by entering new retailers, by expanding in channels like the contract channels here and we are mixing up actually our products here. We should not forget about the Electrolux brand as well in North America which is a strong brand for front loader for instance here. It is a premium brand. Not at all. We certainly have a philosophy in North America which is to mix up our product by offering better product and innovations moving forward.

Speaker #7: And we're pricing for this innovation as well . In North America . So no , I mean we're not fighting really for opening price points on Frigidaire .

Speaker #7: We're not buying market share . What we're really doing is I mean , we're occupying new shop floor spaces by entering new retailers , by expanding in channels like the contract channels here .

Speaker #7: And we are mixing up actually our products here , we should not forget about the brand as well . In North America , which is a strong brand for front loader .

Speaker #7: For instance , here and it is a premium brand . So not at all . I mean , we certainly have a philosophy in North America , which is to mix up our product by offering better product and innovations , moving forward .

Therese Friberg: I guess important to mention, as Yannick also said earlier, we are improving volume, price, and mix in this quarter. With the combination we're seeing of where we are taking share with what retailers and with what products, we don't really see that it's a risk that we are gaining share. It's not really a result of, as you're saying, what we've seen before. Historically, you want that when the market is kind of trading down, that we are absorbing that type of volume. That's not what we see in the quarter.

Speaker #6: And I guess on that.

Speaker #8: Important to mention , as Nick also said earlier , we are improving volume , price and mix in in this quarter and with the combination we're seeing of where we are taking share with what retailers and with what products , we don't really see that it's a that that we are gaining share is not really a result of as you're saying , what we've seen before historically , you want that when the market is kind of trading down , that we are absorbing that that type of volume .

Speaker #8: That's not what we see in in the quarter .

Yannick Fierling: Clearly, I mean I won't repeat it, we have been leading price increase in a price pressure market in North America in Q3.

Speaker #7: And clearly, I mean, I want to repeat it. We have been leading price increases in a price pressure market in North America in Q3.

[Analyst 3]: Excellent. Can you say anything about the product category where you are sort of gaining more or less? I think historically the hot products were your most profitable product in North America, but you've lost out on that segment because of the sales issue. Can you say is the hot product gaining more share or is it sort of broader range over your different categories?

Speaker #6: Excellent . And on the can you say anything about the the product category where you are sort of gaining more or less ? I think historically , the hot products were your most profitable products in North America .

Speaker #6: But but you've lost out on on that segment because of of the issue . But can you say that is the hot product gaining more share or is it sort of broader range over your different categories ?

Yannick Fierling: I think we're gaining market share almost in every single product category. We're not going into detail. I mean there are a couple, of course, where we're losing market share and where we need to act and we have plans in place in order to increase it. I mean on the vast majority of the product ranges we are gaining market share. I don't think we should be pointing out one specific range or whatever it is. Nova Boy market share gain.

Speaker #7: I think we're gaining market share almost in every single product category . We're not going into detail . There is . I mean , there are a couple , of course , where we're losing market share here and where we need to act here .

Speaker #7: And we have plans in place in order to increase it. But, I mean, on the vast majority of the product ranges, we are gaining market share here.

Speaker #7: So I don't think we should be pointing out one specific range or whatever it is an broad market share gain .

[Analyst 3]: Excellent. Just one final minor in the cash flow to Therese, other non-cash items had a negative delta of around SEK 500 million. What's that related to? It was positive SEK 399 million last year, Q3, and now it's negative SEK 104 million. I was just wondering what that was.

Speaker #6: Excellent . And then just one final minor in the cash flow to Terry's other non-cash items had a negative delta of around 500 million .

Speaker #6: What's what's that related to ? It was positive 399 last year Q3 . And now it's -104 . I was just wondering what what that was .

Therese Friberg: With the LTI program that is included in the EBIT, we usually have a small negative every quarter as long as we continue to, of course, increase the provision of the long term incentive program. Last year, it's related to the divestment of South Africa. That is where the change of the goodwill was booked in last year's cash flow.

Speaker #8: Yeah yeah yeah yeah . We I mean we the LTI program that is included in the , in the Ebit , we usually have a negative small negative every , every quarter as long as we continue to of course increase the provision of the of the long term incentive program last year , it's related to the divestment of of South Africa , where technically that's where where the change of the goodwill was , was booked in last year's cash flow .

Yannick Fierling: Okay, thank you very much, Johan.

Speaker #6: Okay. Thank you very much, John. Back.

Ann-Sofi Jönsson: Thank you. I'll take the next question, and this is from Martin Wilkie at Citi. Please go ahead.

Speaker #9: Thank you . I'll now take the next question . And this is from Martin Wilkie at Citi . Please go ahead .

[Analyst]: Good morning. Thank you, Martin. Thank you for taking the question. I wanted to come back to North America. It sounds like you are making good progress there relative to the market, but obviously the absolute level of profit is still quite subdued. When we think going forward about the levers to get that higher, is it a market volume question or is this all around price cost? I mean, is it effectively that the sort of price increases linked to the tariffs and so forth have not yet come through? I guess related to that, is there any sort of self help story? I mean, a lot of what you've done, Anderson and other facilities, I guess, are already completed, but there is a self help element also to getting that margin higher. Thank you.

Speaker #14: Yeah . Good morning . Thank you Martin , thank you for taking the question . I wanted to come back to to North America .

Speaker #14: So it sounds like you are making good progress there relative to the market . But obviously the absolute level of profit is still quite subdued when we think going forward about the levers to get that higher is a market volume question , or is this all around price ?

Speaker #14: Cost? I mean, is it effectively the price increases linked to the tariffs and so forth that have not yet come through? And I guess related to that is any sort of self-help story.

Speaker #14: I mean , a lot of what you've done , Anderson and other facilities , I guess , are already completed , but is there a self-help element also to getting that margin higher ?

Speaker #14: Thank you .

Yannick Fierling: Yeah, thanks Martin, for a question. The first thing I would like to underline if you allow me is that we are plotting in black for the second quarter in a row in North America in a market again which has been pretty price pressured. North America is the first priority. The turnaround of North America is our first priority and I think we have been making progress throughout the last quarter certainly. We have short term actions, midterm actions, and longer term actions to take the regions where we believe it should be belonging, 6% EBIT longer term. I think the big challenge, the main challenge we had in the third quarter is the one I've been mentioning. We have been making progress in terms of volume mix and price.

Speaker #7: Yeah . Thanks , Martin , for a question . I mean , the first thing I would like to underline , if I , if you allow me is that , I mean , we are plotting in black for the second quarter in a row in North America in a market again , which has been pretty priced , pressured .

Speaker #7: I mean , North America is the first priority . The turnaround of North America is our first priority . And I think we have been making progress throughout the last quarter .

Speaker #7: Certainly . I mean , we have short term actions mid term actions and longer term actions to take the regions where we believe it should be belonging .

Speaker #7: 6% EBIT longer term. I think the big challenge, the main challenge we had in the third quarter is the one I've been mentioning.

Speaker #7: We have been making progress in terms of volume mix and price . However , we were not able to price to the extent we wished simply because , I mean , the tariff structure did not impact the imported goods at the logical or rational level .

Yannick Fierling: However, we were not able to price to the extent we wished simply because the tariff structure did not impact the imported goods at the logical or rational level. Moving forward, certainly we are entering into a black November where price pressure will certainly not go down. The tariff structure would be entirely implemented starting 1st of October. If there is some rationale in North America in terms of pricing, we should be benefiting, we should be benefiting mid to long term out of the current tariff structure here as being a North American producer. Again, we did not see unfortunately the level of rational we would have expected in terms of price increase for importing goods in Q3. Challenging month of November with the promotional pressure we'll have. Logically, moving forward we should be benefiting from the current tariff structures in North America producing in North America.

Speaker #7: Now , for I mean , moving forward , certainly . I mean , we are entering into a black November where price pressure will certainly not go down .

Speaker #7: So the tariff structure would be entirely implemented , started 1st of October . So if there is some rationale in North America in terms of of pricing , we should be benefiting , we should be benefiting mid to long term out of the current tariff structure here has being a North American producer .

Speaker #7: So I think again , I mean , we did not see unfortunately , the level of rational we would have expected in terms of price increase for imported goods in Q3 .

Speaker #7: I mean , challenging month of November with the promotional pressure will have , but logically , logically , I mean , moving forward , we should be benefiting from the current tariff structures in North America , producing in North America .

Ann-Sofi Jönsson: Thank you. Your next question is from Uma Samlin, Bank of America. Please go ahead.

Speaker #9: Thank you . And your next question is from Umar Salmon , Bank of America . Please go ahead .

[Analyst 4]: Hi, good morning everyone. Thank you very much for taking my question. I have a follow up on North America if I may. If we look at the AHAM data on the units for North America, it seems to be flat for the quarter. You are gaining some share and it seems like your domestic competitor have said similar things. Who is losing share there? Is there anything you can comment on that? Given the, you know, you sound like the imports have sort of similar price point, they have not been increasing prices. What is the reason that it seems like you and the domestic peers are getting share? Is there any comment you can get there? Thank you.

Speaker #15: Hi . Good morning everyone . Thank you very much for taking my question . I have a follow up on North America . If I may .

Speaker #15: So if we look at the ATM data on the unit for North America , it seems to be flat for the quarter and you are gaining some share .

Speaker #15: And it seems like your domestic competitor have said similar things . And so . So who is losing share there ? So is there anything you can comment on that ?

Speaker #15: Because given the you know , you said like the imports have sort of similar pricing points that have not been increasing prices . So what is the reason that it seems like the domestic you and the domestic peers are gaining share .

Speaker #15: So , is there any comment you can give there ? Thank you .

Yannick Fierling: Thanks. Tough question you're asking. First of all, we're very proud to have gained, to have increased our net sales by a double digit amount in the third quarter. I want to repeat, we have not been buying market share, we have been gaining market share here and indeed, one of the local producers has been saying the same thing. Unfortunately, we don't buy competitive data in North America. I wish I could answer to what you're asking, but we have the same level of information you do have. We have data and we have our data relative to, so it's very difficult for us to comment beyond what you just have been mentioning with competitors reporting out as well their Q3 reports in North America. I'm unfortunately not able to give you more details about who is losing in which product category.

Speaker #7: Thank thanks . Tough question . You're asking . I mean , first of all , we're very proud to have gained or to have increased our net sales by a double digit amount in the third quarter .

Speaker #7: And again , I won't repeat it is not we have not been buying market share . We have been gaining market share here .

Speaker #7: And indeed , I mean , one of the local producers has been saying the same thing . Unfortunately , we don't buy competitive data in North America .

Speaker #7: I wish I could answer to what you're asking , but we have the same level of information you do have . So we have data and we have our data relative to , ahem .

Speaker #7: So it's very difficult for us to comment beyond what you just have been mentioning with competitors reporting out as well . There . Q3 reporting in North America .

Speaker #7: So I'm unfortunately not able to give you more details about who is losing in which product category .

[Analyst 4]: Thank you very much, that's very helpful. My second question is on Europe. It seems like the comparison, the competitive pressure in Europe is still fairly strong, and you know, you are seeing some improvement in sentiment. Do you see any increased competition from your Asian peers here in Europe? Do you expect the pricing to bottom out potentially towards the end of the year or into next year?

Speaker #15: Thank you very much . That's very helpful . So my second question is on Europe , that it seems like competitive . The competitive pressure in Europe is still fairly strong .

Speaker #15: And you know , but you are seeing some improvement in sentiment . Do you see any increased competition from your Asian peers here in Europe ?

Speaker #15: Do you expect the pricing to bottom out potentially , you know , towards the end of the year or into next year ?

Yannick Fierling: No. Thanks for the question. Great question here. In all fairness, Asian penetration in Europe is not something new. Asian had been entering into Europe now several years ago certainly. What I said previously is that the cost difference to manufacture a product in Asia or to manufacture products in North America and Europe has never been as big because of commodity prices, because of energy cost here. The cost difference is really, really big. We opted very courageously in Europe a few years ago to step out of entry price points as Electrolux. We have been ramping down the Zanussi brand and we have been focusing on Electrolux and AEG. We're proud to say today that we're winning more market share on Electrolux and AEG core and premium than we're losing on the Zanussi side of the equation here.

Speaker #7: Thanks for your question . Great question here . In all fairness , I mean , Asian penetration in Europe is not something new .

Speaker #7: I mean , Asians have been entering into Europe now several years ago . Certainly . I mean , what I said previously is that I mean , the cost difference to manufacture a product in Asia or to manufacture product in North America and Europe has never been as big because of commodity prices , because of energy costs here .

Speaker #7: So, the cost difference is really, really big. We opted very courageously in Europe a few years ago to step out of entry price points.

Speaker #7: As electrics . So we have been ramping down the brand and we have been focusing on electrics and ag , and we're proud to say today that we're winning more market share on electrics and ag core and premium than we're losing on the side of the equation here .

Yannick Fierling: We are not exposed to the entrance on entry price point. However, what I need to underline is that you're partly right. We see the market moving down into lower price points in Europe. We see cost pressure being more and more intense here. I think we feel slightly protected from that because of the consumer segments we are targeting in Europe. There is no doubt about that. The market has been moving to lower price points recently and we see a significant level of price pressure.

Speaker #7: So we are not exposed to the entrance on entry price point . However , what I need to underline is that , I mean , you're probably right .

Speaker #7: We see the market moving down into lower price points in Europe . We see cost pressure being more and more intense here . I think we feel slightly protected from that because of the consumer segments .

Speaker #7: We are targeting in Europe . But I mean , there is no doubt about that . The market has been moving to lower price points recently , and we see a significant level of price pressure .

[Analyst 4]: That's super helpful. Thank you very much.

Speaker #7: .

Speaker #15: That's super helpful . Thank you very much .

Speaker #16: Yes .

Ann-Sofi Jönsson: Thank you. The next question is from Bjorn Ennarson from Danske Bank. Please go ahead.

Speaker #9: Thank you . And the next question is from Bjorn Enarson from Danske Bank . Please go ahead .

Yannick Fierling: Thank you. First question on the U.S. again and if you can give us some color on the factory load in the plants and what kind of absorption you have of fixed cost now when you gain some volumes but still volumes are, I assume, quite low. Second question is a little bit on Europe. If you can give some regional comments within Europe where you're seeing these slightly positive trends. Thank you. Thank you very much for your question. As I mentioned previously, the most subdued market versus the past years, I mentioned 2019, is certainly Europe. We are back at the level of 2014. As I said previously, usually this industry in Europe had an organic growth of 2 to 3% a year. If you put 2014, 2025, we're really missing 20 to 30%.

Speaker #17: Thank you . First question on the US again . And if you can give us a call on the factory load in the plants and what kind of absorption you have of fixed cost .

Speaker #17: Now when you gain some volumes , but still volumes are assume quite low . And second question is a little bit on on Europe .

Speaker #17: If you can give some regional comments within Europe where you are seeing this slightly positive trends . Thank you .

Speaker #7: Yeah , thank you very much for your question . I mean , the as I mentioned previously , I mean , the most subdued market versus in the past years , I mean , I mentioned 2019 is certainly Europe .

Speaker #7: I mean , we are back at the level of 2014 . And as I said in the previous calls , I mean , usually these industry in Europe had an organic growth of 2 to 3% a year .

Speaker #7: So if you put 2014 , 2025 , we're really missing 20 to 30% . The market is missing 20 to 30% of the volume .

Yannick Fierling: The market is missing 20 to 30% of the volume we should have expected logically out of the region here. As a consequence, the factories overall which are suffering the most from underutilization are the European factories. That's where everybody is suffering today. In terms of factory loading, I would say in North America, a few good news first. The Springfield factory we were suffering end of last year in terms of ramp up and additional cost. Ramp up was basically inducing. Springfield has been reaching what I would be calling a cruising altitude. The factory is there and I think we don't have the same factory capacity or utilization issues we do see in Europe. Certainly we still have space because we just built this factory. I think we have space in front of us here.

Speaker #7: We should have expected . Logically , out of of a region here . And as a consequence , here , the factories overall , which are suffering the most from underutilization are the European factories .

Speaker #7: That's where everybody is suffering today in terms of factory loading , I would say North America . I mean , a few good news .

Speaker #7: First, I mean, the Springfield factory, we were suffering at the end of last year in terms of ramp-up and additional costs.

Speaker #7: Ramp up was basically inducing . I mean , Springfield has been reaching what I would be calling a cruising altitude . So the factory is , is is is there .

Speaker #7: And I think we don't have the same factory capacity or utilization issues . We do see in Europe . I think certainly we still have space because we just built this factory .

Speaker #7: So I think we we have space in front of us here . But I mean , factory utilization rate is not the major is not the main handicap we may have in North America or the major challenge we do have in North America .

Yannick Fierling: Factory utilization rate is not the main handicap we may have in North America or the major challenge we do have in North America. All the actions to deal with plant load in Europe or how are you dealing with that support Portugal you have done by some divestments, etc. Absolutely. First, we're gaining market share in the core and premium segments. We're fighting for volume. In the EBIT bridge, as I said during the presentation, we have been positive in volume and mix and unfortunately this advantage was slightly offset by the price pressure we see on the market. We are really fighting. We're fighting on the daily days, our team is fighting, is doing a great job on the market basically to win versus our competitors in Europe. What would be helping us the most is simply to get back to a normal type of growth in Europe.

Speaker #17: And are the actions to to deal with plant load in in Europe or how are you dealing with that ? I think you have done by some divestments etc.

Speaker #17: . .

Speaker #7: I mean , first , I mean we're gaining market share in the core and premium segment . So we are fighting for volume .

Speaker #7: And I think NVA bridge , as I said during the presentation , I mean , we have been positive in volume and mix and unfortunately , I mean , these advantage was slightly offset by by the price pressure we see on the market .

Speaker #7: So we are really fighting. We're fighting on a daily basis. Our team is fighting and doing a great job in the market.

Speaker #7: You know , basically to win versus our competitors in Europe . I mean , what would be helping us the most is simply to get back to a normal type of growth in Europe .

Yannick Fierling: I think when I say a normal type of growth, I'm not speaking about the 20 to 30% we were expecting a few years ago, but I mean getting back to 2 to 3% growth in this region here. What will be helping Electrolux the most because of the strength we do have in kitchen channels is basically that the construction market will bounce back, and we believe it has been reaching bottom. Here we are observing that interest rates are lower. We're really hoping that these markets will be bouncing back in the coming months. Right now we don't have a clear sign of it.

Speaker #7: And I think when I say a normal type of growth, I'm not speaking about the 20% to 30% we were expecting a few years ago.

Speaker #7: But I mean , getting back to 2 to 3% growth in this region here . And what would be helping Electrolux the most because of the strength we do have in kitchen channels , is basically that the construction market will bounce back and we believe it has been reaching bottom here .

Speaker #7: We're observing that interest rates are lower , so we're really hoping that this market will be bouncing back . I mean , in the coming months .

Speaker #7: But I mean , right now we don't have a clear sign of it .

Therese Friberg: As you know, with the cost efficiency that we're having this year, it's mainly related to product cost efficiency. We have two years behind us where, of course, we have taken down our staff and our workers in the factories drastically over the last two years prior to this one to cope with the factory, if you like.

Speaker #8: And as you know , with the cost efficiency that we're having this year , it's mainly related to product cost efficiency . But we have two years behind us where of course , we have taken down our our staff and and our workers in the factories drastically over the last two years prior to to this one , to cope with the factory utilization .

Yannick Fierling: Thank you. Very helpful.

Speaker #17: Thank you . Very helpful .

Speaker #18: Great .

Ann-Sofi Jönsson: Thank you. We will now take the next question. This is from Timothy Lee from Barclays. Please go ahead.

Speaker #9: Thank you . We will now take the next question . This is from Timothy Lee from Barclays . Please go ahead .

[Analyst]: Hi, thanks for taking my questions. Can you hear me clearly?

Speaker #19: Hi . Thanks for taking my questions . Can you hear me clearly ?

Yannick Fierling: Yes, yes, absolutely. Good morning.

Speaker #16: Yes . Yes , absolutely .

Speaker #7: Good morning .

[Analyst]: Thank you very much for taking the questions. I have two questions on Europe. The first one is regarding the trend that you have seen in September, which is, you know, some improvement. Can I ask about the historical pattern within the first quarter, whether September is usually a strong month in the quarter or not, and the pickup in September this time is more like a seasonal pattern or is really some improvement in terms of your overall business? That's the first question. The second question is about the margin improvement in Europe on a quarter-on-quarter basis. What's the key driver for that? Is this just mainly from the cost efficiency program or are there any factors that drive the quantum improvement and how sustainable the improvement will be? These are the two questions. Thank you.

Speaker #19: Cool . Yeah . Thank you very much for taking the questions . So I have two questions on Europe . So the first one is regarding the trend that you have seen in September , which is , you know , some improvement .

Speaker #19: Can I ask about the historical pattern within the first quarter , where does September is usually a strong month in the quarter or not .

Speaker #19: And so to pick up in September this time is is more like a seasonal pattern or is really some , you know , improvement in terms of , you know , your overall business .

Speaker #19: That's the first question . And the second question is about the margin improvement in Europe on the quarter . Quarter basis . What's the key driver for that ?

Speaker #19: Is this mainly from the cost efficiency program? Or are there other factors that drive the so-called improvement and how sustainable is it?

Speaker #19: The improvement will be . These two questions , thank you .

Yannick Fierling: Thanks for your question. The communication was not very good. I hope I would be answering your questions correctly about the month of September. First of all, we cannot speak about a pattern because that was basically a month and we have seen really quite a lot of instability in Europe in the past month and I think in all, fair, unexpected moves as well. I think I've been in this business for 25 years, in all fairness. It has been in the last years and months a pretty unstable situation and a situation which is very difficult to predict. However, again, as Therese and myself stated, we had some positive signals in the month of September and I think the only wish we have is to get back to a certain level of normality moving forward in these regions. In terms of.

Speaker #7: Thanks . Thanks for your question . The communication was not very good . So I hope I will be answering your your questions correctly about the month of September .

Speaker #7: First of all , I mean , we cannot speak about a pattern because I mean , that was basically a month and we have seen really quite a lot of instability in Europe in , in the past month .

Speaker #7: And I think, in all fairness, unexpected moves as well. So I think I've been in this business for 25 years.

Speaker #7: In all fairness, I mean, it has been in the last years and months a pretty unstable situation, and a situation which is very difficult to predict.

Speaker #7: However , again , as Therese and myself stated , I mean , we had some positive signals in the month of September , think the only wish we have is to get back to a certain level of normality moving forward in these region , in terms .

Therese Friberg: If the question was more the historical pattern, I think what we can say historically, of course we had September, October, November are really the high season months in our industry. Of course, as you know, the last few years or quite many years now have been very volatile and not really following a normal seasonal pattern. Also, with a very, very subdued kitchen retail channel in Europe, which is usually the boost as well in these three months, that's not really what we have been seeing being strong in the market in the last few years. That's why we have not really had the normal seasonality. Of course, is September strong because we're coming back to that more positive momentum? I guess it's too early to say because it has been going up and down. Historically, of course, September, October, November are the high season months.

Speaker #16: Of, and I guess if.

Speaker #8: The question was more the historical pattern , I think what we can say historically , of course , we had September , October , November are really the high season month in , in , in our industry .

Speaker #8: Then , of course , as you know , the last few years are quite many years now has been very volatile and not

Speaker #8: really following a normal seasonal pattern . And also , of course , with a very , very subdued kitchen retail channel in in Europe , which is usually the boost as well in the , in these three months .

Speaker #8: That's not really what we have been seeing . Being strong in the market in the last few years . So that's why we have not and I really had the normal seasonality .

Speaker #8: So, of course, it's September strong because we're coming back to, you know, that more positive momentum. I guess it's too early to say because it has been going up and up and down.

Speaker #8: But historically , of course , September , October , November are the high season month .

Speaker #16: In terms of .

Yannick Fierling: In terms of margin, if I can just take your question on margin here. As I mentioned previously, I mean we are not targeting entry price points. Our war, our objective is not cost. I mean we want to introduce consumer relevant innovations here, and we're extremely proud to have a high consumer star rating across the three regions here, to win awards like seven Stiva awards in Germany in Laundry, which never anybody has been reaching before. We're really trying to get and extract margin out of innovation and the quality of the products we do have over there, trying to escape the price pressure and cost pressure you may find in the entry price point. However, I mean price pressure is big.

Speaker #7: Sales and in terms of margin . If you can just take your question on margin here , as I mentioned previously , I mean , we are not targeting entry price points .

Speaker #7: Our our war , our objective is not cost . I mean , we want to introduce consumer relevant innovations here . And we're extremely proud to have high consumer Seastar rating across the three regions here to win awards like seven awards in Germany in laundry , which never anybody has been reaching before .

Speaker #7: So we're really trying to get and extract margin out of innovation and the quality of the products . We do have over there , trying to escape the price pressure and cost pressure .

Speaker #7: You may find in the entry price point , however . I mean , price pressure is big , price pressure is big in every single quartile here .

Yannick Fierling: Price pressure is big in every single quartile here, and certainly, I mean reducing cost is one of our strategical pillars, and it is of prime importance to be cost conscious in every single line of our P&L. That's what we're driving with a lot of intensity.

Speaker #7: And certainly I mean , reducing cost is in is one of our strategic pillars , and it is of prime importance to be cost conscious in every single line of our PNL .

Speaker #7: And that's what we're driving with a lot of intensity .

Ann-Sofi Jönsson: Okay, great. We will take one question from the webinar, which is from Swedbank, from Timothy Becker, and that is if we can elaborate on the goal of maintaining a solid investment-grade credit rating and if we are.

Speaker #8: Okay , great . We will .

Speaker #6: Take one question from the webinar , which is from Swedbank , from Timothy Becker . And that is if we can elaborate on the goal of maintaining a solid investment rating and if we are okay with the rating or if how if we have a goal to improve that , and if you could elaborate on that , yes .

Therese Friberg: Okay, with the rating or if we.

Ann-Sofi Jönsson: Have a goal to improve that, and if you could elaborate on that.

Therese Friberg: Yes, of course. I mean as we stated in the call, our aim is really to maintain a solid investment-grade rating quarter over quarter. I mean compared to last year we are improving on our net debt EBITDA ratio, and quarter over quarter compared to the second quarter we are stable. Of course we're doing everything we can to remain solid in the investment grade.

Speaker #8: Yes , of course . I mean , as we stated in the call , our aim is really to maintain a solid investment grade rating quarter over quarter .

Speaker #8: I mean , compared to last year , we are improving on our net debt to EBITDA ratio and the quarter over quarter compared to the second quarter , we are stable .

Speaker #8: And of course , we're doing everything we can to remain solid investment grade rated .

Yannick Fierling: Our focus remains delivering the year-end result on the profit side of the equation.

Speaker #7: Our focus remains on delivering the year-end results on the profit side of the equation.

Ann-Sofi Jönsson: Great. We have one more question on the.

Speaker #6: Great .

Speaker #8: We have .

Speaker #6: One more question on the call that I think we will try to take after we or before we close off .

Therese Friberg: Call that I think we will try to take after we or before we close off.

Ann-Sofi Jönsson: Thank you. Final question is from John Kim from Deutsche Bank. Please go ahead.

Speaker #9: Thank you . Final question is from John Kim from Deutsche Bank . Please go ahead .

[Analyst]: Hi, thanks for the opportunity to follow up. I'm just wondering if you'd comment a bit on wage inflation. What sort of % are you experiencing? What's the cadence to it? Are there large upcoming negotiations with any union organizations?

Speaker #12: Hi. Thanks for the opportunity to follow up. I'm just wondering if you could comment a bit on wage inflation, sort of percentages.

Speaker #12: Are you experiencing any issues? What's the cadence to it? Are there large upcoming negotiations with any unionized organizations?

Therese Friberg: No, I would say nothing extraordinary that we can mention.

Speaker #8: No , I would say nothing . Nothing extraordinary that we can that we can mention .

[Analyst]: Okay, while I have the floor, is there anything you'd call out in the August developments around U.S. tariffs that we should be mindful of, whether it's the metal content or the reciprocal calls?

Speaker #12: Okay. And while I have the floor, is there anything you'd call out in the August developments around the U.S.? Tariffs that we should be particularly mindful of, whether it's the metal content or the reciprocals.

Yannick Fierling: You want to answer this one? You want me to take it? Nothing special on the, of course, I mean as I mentioned previously, John, I mean tariff-related tariff structure certainly should certainly be benefiting the local producers here. The full tariff structure is implemented, I mean starting beginning of October, and again, all what we're hoping as a North American producer is to see a rational price increase for imported goods starting as soon as possible. That's what I would say.

Speaker #7: You want to answer these one . You want me to take it . Nothing special on the of course . I mean , as I mentioned previously John , I mean tariff , the latest tariff structure is certainly should certainly be benefiting the the local producers here .

Speaker #7: The full tariff structure is implemented. I mean, starting at the beginning of October, and again, all we're hoping for as North American producers is to see a rational price increase for imported goods starting as soon as possible.

Speaker #7: That's what I would say. Yeah.

[Analyst]: Excellent. Thank you.

Speaker #12: So excellent. Thank you.

Ann-Sofi Jönsson: Thank you, John, and thank you, everyone who has listened. With that, we will end this call, and I would like to remind you that we will have a capital market update on the 4th of December that will also be live webcasted. Thank you for viewing and listening in today.

Speaker #6: Thank you John . And with thank you everyone who has listened with that . We will end this call . And I would like to remind you that we will have a capital market update on the 4th of December .

Speaker #6: That will also be live Webcasted . So thank you for viewing and listening in today .

Yannick Fierling: Thank you very much.

Speaker #7: Thank you very much .

[Analyst 4]: It.

[Analyst]: Sam SA.