Half Year 2026 Jenoptik AG Earnings Call

August 12, 2026

Speaker #2: Oh, how are you doing? What's been...

Operator 2: How you doing? What's going?

Speaker #3: Conference call regarding the results of the first half-year 2026. The conference will be recorded. At this time, all participants have been placed on listen-only mode.

Operator 3: Conference call regarding the results of the H1 2026. The conference will be recorded. At this time all participants have been placed on a listen only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Dr. Prisca Havranek-Kosicek.

Operator: Conference call regarding the results of the H1 year 2026. The conference will be recorded. At this time all participants have been placed on a listen only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Dr. Prisca Havranek.

Speaker #3: The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Dr. Priska Havranec.

Speaker #4: Good morning, everyone, and welcome to our call on the results for the first half-year 2026. As in the past, I will lead you through the presentation, and then Andreas, our Head of Investor Relations, and I will be open to your questions.

Prisca Havranek-Kosicek: Good morning everyone and welcome to our call on the results for the H1 2026. As in the past, I will lead you through the presentation and then Andreas, our Head of Investor Relations, and I will be open to your questions. Before we go into detail here, I would like to hand over to our new CEO, Dominik Dorfner.

Prisca Havranek: Good morning everyone and welcome to our call on the results for the H1 year 2026. As in the past, I will lead you through the presentation and then Andreas, our Head of Investor Relations, and I will be open to your questions. Before we go into detail here, I would like to hand over to our new CEO, Dominik Dorfner.

Speaker #4: But before we go into detail here, I would like to hand over to our new CEO, Dominic Dorfner.

Speaker #5: Thank you, Priska, and good morning to everyone. I am very pleased to introduce myself to our investors and analysts on the occasion of our half-year results release, now that I have officially been on board since August 1.

Dominic Dorfner: Thank you, Priska, and good morning to everyone. I am very pleased to introduce myself to our investors and analysts on the occasion of our first year results release, now that I have been officially on board since 1 August. I have already had the chance to meet many Jenoptik colleagues at several different sites and even different continents over the past weeks, and I have gained some first good impressions of Jenoptik. What I saw during the first interactions impressed me. Firstly, I saw great people, highly dedicated to their business, as well as highly motivated. For me, that represents a strong basis. Secondly, I saw strong technologies. Jenoptik's competencies, for example in optics, are just impressive. So is its ability to turn science or physics into solutions that truly add value to our customers.

Dominic Dorfner: Thank you, Priska, and good morning to everyone. I am very pleased to introduce myself to our investors and analysts on the occasion of our first year results release, now that I have been officially on board since 1 August 2026. I have already had the chance to meet many Jenoptik colleagues at several different sites and even different continents over the past weeks, and I have gained some first good impressions of Jenoptik. What I saw during the first interactions impressed me. Firstly, I saw great people, highly dedicated to their business, as well as highly motivated. For me, that represents a strong basis. Secondly, I saw strong technologies. Jenoptik's competencies, for example in optics, are just impressive. So is its ability to turn science or physics into solutions that truly add value to our customers.

Speaker #5: I've already had the chance to meet many Jenoptik colleagues at several different sites, and even on different continents. Over the past weeks, I have gained some good first impressions of Jenoptik.

Speaker #5: What I saw during the first interactions impressed me. Firstly, I saw great people, highly dedicated to their business, as well as highly motivated. So, for me, that represents a strong basis.

Speaker #5: Secondly, I saw strong technologies. JENOPTIK's competencies, for example in optics, are just impressive. And so is its ability to turn science or physics into solutions that truly add value for our customers.

Speaker #5: And finally, I'm personally convinced that there is great relevance of photonics for many industries we serve, and its importance may even accelerate in the future.

Dominic Dorfner: I am personally convinced that there is a great relevance of photonics for many industries we serve, and its importance may even accelerate in the future. Or maybe in more simple terms, I am convinced that photonics is an attractive industry with a lot of growth potential. For me, as a physicist, joining JENOPTIK is a dream. For me as a manager, it means potential and ambition. What ultimately drives me is finding out what is possible, shaping and building with courage, and this is what we are striving towards together as the JENOPTIK team. As I said earlier, I already had the chance meeting and talking to many people in the company, and for the next few weeks, my focus will be on listening, getting to know even more people, customers, and to understand all of our business in full.

Dominic Dorfner: I am personally convinced that there is a great relevance of photonics for many industries we serve, and its importance may even accelerate in the future. Or maybe in more simple terms, I am convinced that photonics is an attractive industry with a lot of growth potential. For me, as a physicist, joining Jenoptik is a dream. For me as a manager, it means potential and ambition. What ultimately drives me is finding out what is possible, shaping and building with courage, and this is what we are striving towards together as the Jenoptik team. As I said earlier, I already had the chance meeting and talking to many people in the company, and for the next few weeks, my focus will be on listening, getting to know even more people, customers, and to understand all of our business in full.

Speaker #5: Or, maybe in more simple terms, I'm convinced that photonics is an attractive industry with a lot of growth potential. So, for me as a physicist, joining JENOPTIK is a dream.

Speaker #5: For me, as a manager, it means potential and ambition. So, what ultimately drives me is finding out what is possible, shaping and building with courage. This is what we are striving towards together as the JENOPTIK team.

Speaker #5: As I said earlier, I already had the chance to meet and talk to many people in the company, and for the next few weeks, my focus will be on listening, getting to know even more people and customers, and understanding all of our business in full.

Speaker #5: Finally, I'd like to comment on a matter that has been mentioned in the news in recent weeks or even months. You might know that we are currently undergoing some sort of strategy process update, which is already in full swing, and we expect the JENOPTIK Executive Board to be in a position to communicate key findings and outcomes toward the end of the year, at the earliest.

Dominic Dorfner: Finally, I would like to comment on a matter that has been mentioned in the news in the recent weeks or even months. You might know that we are currently undergoing some sort of a strategy process update, which is in full swing already, and we expect the JENOPTIK executive board to be in a position to communicate key findings and outcomes towards the end of the year at the earliest. Please bear with me and my colleagues that we may not be able to answer questions relating to that matter in the very near future. Thanks to you, and I will now hand back to Priska for the H1 results and also later the Q&A session. Thank you.

Dominic Dorfner: Finally, I would like to comment on a matter that has been mentioned in the news in the recent weeks or even months. You might know that we are currently undergoing some sort of a strategy process update, which is in full swing already, and we expect the Jenoptik executive board to be in a position to communicate key findings and outcomes towards the end of the year at the earliest. Please bear with me and my colleagues that we may not be able to answer questions relating to that matter in the very near future. Thanks to you, and I will now hand back to Priska for H1 results and also later the Q&A session. Thank you.

Speaker #5: So please bear with me and my colleagues, as we may not be able to answer questions relating to that matter in the very near future.

Speaker #5: Thank you. I will now hand back to Priska for the H1 results, and later, the Q&A session. Thank you.

Speaker #4: Thank you, Dominic. Now, let me start with an overview on page four of our slide deck. First of all, we saw exceptionally strong order intake dynamics, particularly in our OEM businesses, continue also in the second quarter.

Prisca Havranek-Kosicek: Thank you, Dominik. Now let me start with an overview on page 4 of our slide deck. First of all, we saw exceptionally strong order intake dynamics, particularly in our OEM businesses, to continue also in Q2, overall exceeding our expectation. The ramp-up in the semi industry continues to be in full swing as far as we see it, but also order intake in our Biophotonics business unit was substantially up compared to last year, for reasons I will address a little later in this call. I am pleased to report that revenues for the H1 were slightly up year on year for the first time in a while, driven by our semi business and SMS.

Prisca Havranek: Thank you, Dominik. Now let me start with an overview on page four of our slide deck. First of all, we saw exceptionally strong order intake dynamics, particularly in our OEM businesses, to continue also in Q2, overall exceeding our expectation. The ramp-up in the semi industry continues to be in full swing as far as we see it, but also order intake in our Biophotonics business unit was substantially up compared to last year, for reasons I will address a little later in this call. I am pleased to report that revenues for H1 were slightly up year-on-year for the first time in a while, driven by our semi business and SMS.

Speaker #4: Overall, we are exceeding our expectations. The ramp-up in the semi industry continues to be in full swing, as far as we see it. Also, order intake in our Biophotonics business unit was substantially up compared to last year, for reasons I will address a little later in this call.

Speaker #4: I am pleased to report that revenues for the first half-year were slightly up year-on-year for the first time in a while, driven by our SEMI business and SMS.

Speaker #4: We are also pleased to report a strong improvement in our profitability in terms of EBITDA margin, noting, however, that profitability in the first half of 2025 represented a modest comp.

Prisca Havranek-Kosicek: We are also pleased to report a strong improvement in our profitability in terms of EBITDA margin, noting, however, that profitability in the H1 2025 represented a modest comp. Free cash flow improved slightly year on year, reflecting besides higher profits, greater working capital needs in conjunction with our strong order intake. Looking forward, our near-term focus is clearly on our capacity expansion projects in our OEM businesses, as well as maximizing output in the light of the significantly increased order backlog. Furthermore, as Dominik has already mentioned, we are currently reviewing our businesses, including strategy, with outcomes expected towards the end of this year at the earliest. Finally, we continue to focus on and address our commercial opportunities besides semi, for example, in optical data communication, defense application, as well as our SMS business in the US.

Prisca Havranek: We are also pleased to report a strong improvement in our profitability in terms of EBITDA margin, noting, however, that profitability in H1 2025 represented a modest comp. Free cash flow improved slightly year-on-year, reflecting besides higher profits, greater working capital needs in conjunction with our strong order intake. Looking forward, our near-term focus is clearly on our capacity expansion projects in our OEM businesses, as well as maximizing output in the light of the significantly increased order backlog. Furthermore, as Dominik has already mentioned, we are currently reviewing our businesses, including strategy, with outcomes expected towards the end of this year at the earliest. Finally, we continue to focus on and address our commercial opportunities besides semi, for example, in optical data communication, defense application, as well as our SMS business in the US.

Speaker #4: Free cash flow improved slightly year-on-year, reflecting, besides higher profits, greater working capital needs in conjunction with our strong order intake. Now, looking forward, our near-term focus is clearly on our capacity expansion projects in our OEM businesses, as well as maximizing output in light of the significantly increased order backlog.

Speaker #4: Furthermore, as Dominic has already mentioned, we are currently reviewing our businesses, including strategy, with outcomes expected toward the end of this year at the earliest.

Speaker #4: And finally, we continue to focus on and address our commercial opportunities besides semi, for example, in optical data communications, defense applications, as well as our SMS business in the U.S.

Speaker #4: Regarding guidance, given what I have just stated, we now expect to reach the upper half of the initial guided revenue range and EBITDA margin range.

Prisca Havranek-Kosicek: Regarding guidance, given what I've just been stating before, we now expect to reach the upper half of the initial guided revenue range and EBITDA margin range. Moving on to page 5. As I've just mentioned, we saw particularly strong demand in Semiconductor & Advanced Manufacturing, as well as in Biophotonics continue in Q2, driving order intake on group level up by more than 50% year on year, overall exceeding our expectation. Starting with Semiconductor & Advanced Manufacturing, as you know, by far our biggest business unit. Order intake was driven by both our lithography business as well as continued strong customer activity in our semiconductor inspection business. Given that we mentioned in our last call that Q1 benefited from a large annual order, I think it's not a surprise that Q2 was a little below the order intake levels recorded in Q1.

Prisca Havranek: Regarding guidance, given what I've just been stating before, we now expect to reach the upper half of the initial guided revenue range and EBITDA margin range. Moving on to page five. As I've just mentioned, we saw particularly strong demand in Semiconductor & Advanced Manufacturing, as well as in Biophotonics continue in Q2, driving order intake on group level up by more than 50% year-on-year, overall exceeding our expectation. Starting with Semiconductor & Advanced Manufacturing, as you know, by far our biggest business unit. Order intake was driven by both our lithography business as well as continued strong customer activity in our semiconductor inspection business. Given that we mentioned in our last call that Q1 benefited from a large annual order, I think it's not a surprise that Q2 was a little below the order intake levels recorded in Q1.

Speaker #4: Now moving on to page five. As I just mentioned, we saw particularly strong demand in semi and advanced manufacturing, as well as in biophotonics, continue in the second quarter.

Speaker #4: Driving order intake on group level up by more than 50% year-on-year, overall exceeding our expectations. Now, starting with semiconductor and advanced manufacturing, as you know, by far our biggest business unit.

Speaker #4: Order intake was driven by both our lithography business as well as continued strong customer activity in our semi inspection business. And given that we mentioned in our last call that Q1 benefited from a large annual order, I think it's not a surprise that Q2 was a little below the order intake levels recorded in Q1.

Speaker #4: Turning to our biophotonics business, order intake was again very strong also in the second quarter. Therefore, H1 26, where we report a 45% increase year over year.

Prisca Havranek-Kosicek: Turning to our Biophotonics business. Order intake was again very strong, also in Q2. Therefore, H1 2026, we report a 45% increase year over year. This performance was to a certain extent driven by very high demand for our portfolio related to the defense end market in the first half year. In addition, we also saw an overall positive order intake dynamics in the MedTech and life science field. Here, a lower momentum in the field of dentistry was more than compensated by a multi-year order in the low double-digit million range that we received in the MedTech space. Similarly, although as we discussed in Q1, we believe that there also may have been certain early order effects in conjunction with growing geopolitical uncertainties since the start of this year.

Prisca Havranek: Turning to our Biophotonics business. Order intake was again very strong, also in Q2. Therefore, H1 2026, we report a 45% increase year-over-year. This performance was to a certain extent driven by very high demand for our portfolio related to the defense end market in the first half year. In addition, we also saw an overall positive order intake dynamics in the MedTech and life science field. Here, a lower momentum in the field of dentistry was more than compensated by a multi-year order in the low double-digit million range that we received in the MedTech space. Similarly, although as we discussed in Q1, we believe that there also may have been certain early order effects in conjunction with growing geopolitical uncertainties since the start of this year.

Speaker #4: This performance was, to a certain extent, driven by very high demand for our portfolio-related defense end market in the first half-year. In addition, we also saw overall positive order intake dynamics in the MedTech and Life Science field.

Speaker #4: Here, a lower momentum in the field of dentistry was more than compensated by a multi-year order in the low double-digit million range that we received in the MedTech space.

Speaker #4: Similarly, as we discussed in the first quarter, we believe that there also may have been certain early order effects in conjunction with growing geopolitical uncertainties since the start of this year.

Speaker #4: Also, let me remind you that we continue to believe that quarterly volatility of order intake in this business unit will remain high going forward, partly because of a special pattern in the defense industry, as well as a certain volatility that you usually see while running a concentrated key account business model.

Prisca Havranek-Kosicek: Also, let me remind you that we continue to believe that quarterly volatility of order intake in this business unit will remain high going forward, partly because of a special pattern in the defense industry, as well as a certain volatility that you usually see while running a concentrated key account business model. Moving on to our solutions businesses. For both metrology and production solutions as well as Smart Mobility Solutions, order intake developed broadly as we were expecting, with both business units reporting low double-digit order intake growth. Overall, as a consequence of these developments in demand, our H1 book-to-bill ratio for the group went up sharply to 1.4, and our order backlog grew substantially to around EUR 825 million. Please follow me now to page 6 to cover our revenue development.

Prisca Havranek: Also, let me remind you that we continue to believe that quarterly volatility of order intake in this business unit will remain high going forward, partly because of a special pattern in the defense industry, as well as a certain volatility that you usually see while running a concentrated key account business model. Moving on to our solutions businesses. For both metrology and production solutions as well as Smart Mobility Solutions, order intake developed broadly as we were expecting, with both business units reporting low double-digit order intake growth. Overall, as a consequence of these developments in demand, our H1 book-to-bill ratio for the group went up sharply to 1.4, and our order backlog grew substantially to around EUR 825 million. Please follow me now to page 6 to cover our revenue development.

Speaker #4: Now, moving on to our Solutions businesses. For both Metrology and Production Solutions, as well as Smart Mobility Solutions, order intake developed broadly as we were expecting, with both business units reporting low double-digit order intake growth.

Speaker #4: So, overall, as a consequence of these developments in demand, our H1 book-to-bill ratio for the group went up sharply to 1.4, and our order backlog grew substantially to around €825 million.

Speaker #4: Please follow me now to page six to cover our revenue development. Whereas Q1 revenues were still slightly down year-on-year, as you can see on the left side of this slide, we returned to growth in the second quarter.

Prisca Havranek-Kosicek: Whereas Q1 revenues were still slightly down year on year, as you can see on the left side of this slide, we returned to growth in the second quarter. This leads to an overall modest 1% growth at the half year point. Excluding effects from currencies, especially relating to the EUR dollar exchange rate fluctuations, revenue growth would have been up by close to 3%. At a segment level, Semiconductor & Advanced Manufacturing revenue was up by around 10% year on year, driven both by our lithography as well as our semiconductor inspection business. Digital Datacom was supportive, albeit on a lower level, given the relative size of this business compared to the other two businesses. Let's look at Biophotonics. Here in the last year, as you know, we benefited from a strong dental business.

Prisca Havranek: Whereas Q1 revenues were still slightly down year on year, as you can see on the left side of this slide, we returned to growth in the second quarter. This leads to an overall modest 1% growth at the half year point. Excluding effects from currencies, especially relating to the EUR dollar exchange rate fluctuations, revenue growth would have been up by close to 3%. At a segment level, Semiconductor & Advanced Manufacturing revenue was up by around 10% year on year, driven both by our lithography as well as our semiconductor inspection business. Digital Datacom was supportive, albeit on a lower level, given the relative size of this business compared to the other two businesses. Let's look at Biophotonics. Here in the last year, as you know, we benefited from a strong dental business.

Speaker #4: This leads to an overall modest 1% growth at the half-year point. Excluding effects from currencies, especially relating to the euro-dollar exchange fluctuations, revenue growth would have been up by close to 3%.

Speaker #4: At a segment level, semi-advanced manufacturing revenue was up by around 10% year-on-year, driven both by our lithography as well as our semi inspection business.

Speaker #4: Digital Data Comm was supportive, albeit on a lower level given the relative size of this business compared to the other two businesses. Now, let's look at Fire Photonics.

Speaker #4: Here, in the last year, as you know, we benefited from a strong dental business. Given the space effect, the MedTech business did not quite reach the prior year’s levels, as we were expecting.

Prisca Havranek-Kosicek: Given this base effect, the MedTech business did not quite reach the prior year's levels as we were expecting. On the contrary, a strong development in defense partially compensated for this. However, overall revenues were still down by almost 5% year on year. For Metrology and Production Solution, revenue development primarily reflects the continued difficult market environment in the European automotive sector. Nonetheless, given the typical seasonality in the MPS business overall and considering the overall robust order intake in this business, we expect the H2 of 2026 to be better than the H1. Finally, revenue of our Smart Mobility Solutions business was up by almost 11%, driven by almost all regions. On the next page 7 that is, we look at our profit performance.

Prisca Havranek: Given this base effect, the MedTech business did not quite reach the prior year's levels as we were expecting. On the contrary, a strong development in defense partially compensated for this. However, overall revenues were still down by almost 5% year on year. For Metrology and Production Solution, revenue development primarily reflects the continued difficult market environment in the European automotive sector. Nonetheless, given the typical seasonality in the MPS business overall and considering the overall robust order intake in this business, we expect the H2 of 2026 to be better than the H1. Finally, revenue of our Smart Mobility Solutions business was up by almost 11%, driven by almost all regions. On the next page 7 that is, we look at our profit performance.

Speaker #4: On the contrary, strong development in Defense partially compensated for this. However, overall revenues were still down by almost 5% year-on-year. For Metrology and Production Solution, revenue development primarily reflects the continued difficult market environment in the European automotive sector.

Speaker #4: Nonetheless, given the typical seasonality in the US and in the MPS business overall, and considering the overall robust order intake in this business, we expect the second half of '26 to be better than the first half.

Speaker #4: Finally, revenue of our Smart Mobility Solutions business was up by almost 11%, driven by almost all regions. On the next page—page seven, that is—we look at our profit performance.

Speaker #4: As you can see on the left side of this slide, the Group's EBITDA reached around €99 million, up by a little more than 25% compared to last year.

Prisca Havranek-Kosicek: As you can see on the left side of this slide, the group's EBITDA reached around EUR 99 million, up by little more than 25% compared to last year. This implies an improvement of our EBITDA margin by almost 400 basis points, which is primarily driven by the following elements. Firstly, of course, we see the benefits of the overall lower cost base resulting from our cost reduction program executed last year. Secondly, we see our product mix improving, especially relating to the semiconductor business. Finally, please remember the Q1 of 2025 was influenced by one-time relocation costs relating to the move to our Dresden fab, which we didn't have in the H1 of 2026. On business unit level, based on the aspects mentioned before, our semiconductor business recorded a very strong EBITDA margin of close to 32%.

Prisca Havranek: As you can see on the left side of this slide, the group's EBITDA reached around EUR 99 million, up by little more than 25% compared to last year. This implies an improvement of our EBITDA margin by almost 400 basis points, which is primarily driven by the following elements. Firstly, of course, we see the benefits of the overall lower cost base resulting from our cost reduction program executed last year. Secondly, we see our product mix improving, especially relating to the semiconductor business. Finally, please remember the Q1 of 2025 was influenced by one-time relocation costs relating to the move to our Dresden fab, which we didn't have in the H1 of 2026. On business unit level, based on the aspects mentioned before, our semiconductor business recorded a very strong EBITDA margin of close to 32%.

Speaker #4: This implies an improvement of our EBITDA margin by almost 400 basis points, which is primarily driven by the following elements. Firstly, of course, we see the benefits of the overall lower cost base resulting from our cost reduction program executed last year.

Speaker #4: Secondly, we see our product mix improving, especially relating to the semi business. And finally, please remember the first quarter of 2025 was influenced by one-time relocation costs related to the move to our Dresden fab, which we didn't have in the first half of '26.

Speaker #4: On the business unit level, based on the expectations mentioned before, our semi business recorded a very strong EBITDA margin of close to 32%. Despite a certain decline in revenues, as I explained earlier, our biophotonics business continued to operate at a strong margin level of almost 22% in the first half.

Prisca Havranek-Kosicek: Despite a certain decline in revenues, as I have explained earlier, our Biophotonics business continued to operate at a strong margin level of almost 22% in the H1. In the SMS business, we also saw a good move forward in terms of margins as top line growth was driving operational leverage, while in addition, R&D expenses were lower year on year. MPS remains slightly loss-making given its modest revenue development in the H1. As I mentioned before, we believe the H2 of the year performance may be better than what we have seen in the first six months. The other line, which includes our corporate center as well as Prodomax, we saw an about EUR 8 million negative swing in the EBITDA year on year, largely relating to certain corporate project costs as well as provisions related to share-based compensation, while Prodomax is no relevant factor here.

Prisca Havranek: Despite a certain decline in revenues, as I have explained earlier, our Biophotonics business continued to operate at a strong margin level of almost 22% in the H1. In the SMS business, we also saw a good move forward in terms of margins as top line growth was driving operational leverage, while in addition, R&D expenses were lower year on year. MPS remains slightly loss-making given its modest revenue development in the H1. As I mentioned before, we believe the H2 of the year performance may be better than what we have seen in the first six months. The other line, which includes our corporate center as well as Prodomax, we saw an about EUR 8 million negative swing in the EBITDA year on year, largely relating to certain corporate project costs as well as provisions related to share-based compensation, while Prodomax is no relevant factor here.

Speaker #4: In the SMS business, we also saw a good move forward in terms of margins, as top-line growth was driving operational leverage, while, in addition, R&D expenses were lower year-on-year.

Speaker #4: MPS remains slightly loss-making given its modest revenue development in the first half, and as I mentioned before, we believe the second half of the year performance may be better than what we have seen in the first six months.

Speaker #4: The other line, which includes our Corporate Center as well as Prodomax, we saw an about $8 million negative swing in EBITDA year-on-year, largely relating to certain corporate project costs as well as provisions related to share-based compensation, while Prodomax is no relevant factor here.

Speaker #4: Now, looking at key aspects of our P&L on page eight: Gross margin was considerably up year-on-year, which was primarily influenced by a generally lower cost base, as well as a higher contribution by our Semi business, as I have already alluded to before.

Prisca Havranek-Kosicek: Now looking at key aspects of our P&L on page 8. Gross margin was considerably up year-on-year, which was primarily influenced by a general lower cost base as well as a higher contribution by our Semi business as I have already alluded before. On the functional expense side, we remained very disciplined. However, those expenses grew by 3.7% year-on-year as we had to recognize higher expenses for share-based long-term incentives, amongst other things. EBIT for the period under review grew faster than EBITDA, given slightly lower depreciation and amortization. Therefore, EBIT was up by 56% year-on-year, while the respective margin jumped to 12.3% in the H1. Bottom line, our earnings per share reached EUR 0.69 versus EUR 0.42 in the prior year. Now turning to page 9 and looking at cash flow and the balance sheet data. Let me start with operating cash flow.

Prisca Havranek: Now looking at key aspects of our P&L on page 8. Gross margin was considerably up year-on-year, which was primarily influenced by a general lower cost base as well as a higher contribution by our Semi business as I have already alluded before. On the functional expense side, we remained very disciplined. However, those expenses grew by 3.7% year-on-year as we had to recognize higher expenses for share-based long-term incentives, amongst other things. EBIT for the period under review grew faster than EBITDA, given slightly lower depreciation and amortization. Therefore, EBIT was up by 56% year-on-year, while the respective margin jumped to 12.3% in the H1. Bottom line, our earnings per share reached EUR 0.69 versus EUR 0.42 in the prior year. Now turning to page 9 and looking at cash flow and the balance sheet data. Let me start with operating cash flow.

Speaker #4: On the functional expense side, we remained very disciplined. However, those expenses grew by 3.7% year-on-year, as we had to recognize higher expenses for share-based long-term incentives, among other things.

Speaker #4: EBIT for the period under review grew faster than EBITDA, given slightly lower depreciation and amortization. Therefore, EBIT was up by 56% year-on-year, while the respective margin jumped to 12.3% in the first half.

Speaker #4: Bottom line, our earnings per share reached €0.69, versus €0.42 in the prior year. Now turning to page nine and looking at cash flow and balance sheet data.

Speaker #4: Let me start with operating cash flow. The trend in the first half of the year is very much mirroring what we reported in the first quarter already, meaning that the strong order intake has led us to shift our priorities towards optimizing our ability to serve our customers.

Prisca Havranek-Kosicek: The trend in the H1 is very much mirroring what we reported in the Q1 already, meaning that the strong order intake has led us to shift our priorities towards optimizing our ability to serve our customers. Hence, we have been taking on more working capital compared to the end of last year, resulting in a reduced operating cash flow. Adding on to what I just said, you see that our working capital ratio was up at the end of the H1, and I would like to note that given the ongoing Semi-ramp, we expect this ratio to trend to slightly above 2025 levels in the H2. Free cash flow, however, was slightly up year-on-year due to low investing cash outflows. Please note that the H1 of 2025 was still including considerable cash outflows relating to our new fab in Dresden.

Prisca Havranek: The trend in the H1 is very much mirroring what we reported in the Q1 already, meaning that the strong order intake has led us to shift our priorities towards optimizing our ability to serve our customers. Hence, we have been taking on more working capital compared to the end of last year, resulting in a reduced operating cash flow. Adding on to what I just said, you see that our working capital ratio was up at the end of the H1, and I would like to note that given the ongoing Semi-ramp, we expect this ratio to trend to slightly above 2025 levels in the H2. Free cash flow, however, was slightly up year-on-year due to low investing cash outflows. Please note that the H1 of 2025 was still including considerable cash outflows relating to our new fab in Dresden.

Speaker #4: Hence, we've been taking on more working capital compared to the end of last year, reducing recycling, and then reduced operating cash flow. Adding on to what I just said, you see that our working capital ratio was up at the end of the first half, and I would like to note that, given the ongoing semi ramp, we expect this ratio to trend to slightly above 2025 levels in the second half.

Speaker #4: Free cash flow, however, was slightly up year-on-year due to lower investing cash outflows. Please note that the first half of 2025 still included considerable cash outflows relating to our new fab in Dresden.

Speaker #4: On the remaining financial parameters, we have not seen any major changes compared to the end of last year, meaning that the overall financial situation has remained very, very robust.

Prisca Havranek-Kosicek: On the remaining financial parameters, we have not seen any major changes compared to the end of last year, meaning that overall financial situation has remained very robust. Finally, please follow me to page 11 to cover our specific guidance for 2026. Even though order intake is not a guidance KPI for us, as you know, I would like to make a comment here. It is clear that we are very pleased with the dynamics that we have seen in the first 6 months of this year. However, I think it is fair to note that we received some orders surprisingly early, that is, they were originally expected to come later in this year. Therefore, we believe that the very strong order intake dynamics in the first 6 months may not necessarily continue in the upcoming 2 quarters.

Prisca Havranek: On the remaining financial parameters, we have not seen any major changes compared to the end of last year, meaning that overall financial situation has remained very robust. Finally, please follow me to page 11 to cover our specific guidance for 2026. Even though order intake is not a guidance KPI for us, as you know, I would like to make a comment here. It is clear that we are very pleased with the dynamics that we have seen in the first 6 months of this year. However, I think it is fair to note that we received some orders surprisingly early, that is, they were originally expected to come later in this year. Therefore, we believe that the very strong order intake dynamics in the first 6 months may not necessarily continue in the upcoming 2 quarters.

Speaker #4: And finally, please follow me to page 11 to cover our specific guidance for 2026. So, even though order intake is not a guidance KPI for us, as you know, I would like to make a comment here.

Speaker #4: It is clear that we are very pleased with the dynamics that we have seen in the first six months of this year. However, I think it is fair to note that we received some orders and supplies early—that is, they were originally expected to come later in this year.

Speaker #4: Therefore, we believe that the very strong order intake dynamics in the first six months may not necessarily continue in the upcoming two quarters. Now, on the basis of our performance year to date, we now expect our full-year revenues to reach the upper half of our initial guidance range of single-digit revenue growth.

Prisca Havranek-Kosicek: Now, on basis of our performance year to date, we now expect our full year revenues to reach the upper half of our initial guidance range of single-digit revenue growth. That means we are now expecting revenue growth of between 5% and 9% for this year. The prime driver is our Semiconductor & Advanced Manufacturing business, where we now expect to develop better than we expected earlier this year. Also reflected in this updated guidance is the continuing weakness in our automotive-related businesses, which is very relevant for our MPS business unit. In line with our updated revenue guidance, we also expect our EBITDA margin to be in the upper half of the original guidance range of 19% to 21% on a full year basis. That is, we expect our EBITDA margin to come in at between 20% and 21% this year.

Prisca Havranek: Now, on basis of our performance year to date, we now expect our full year revenues to reach the upper half of our initial guidance range of single-digit revenue growth. That means we are now expecting revenue growth of between 5% and 9% for this year. The prime driver is our Semiconductor & Advanced Manufacturing business, where we now expect to develop better than we expected earlier this year. Also reflected in this updated guidance is the continuing weakness in our automotive-related businesses, which is very relevant for our MPS business unit. In line with our updated revenue guidance, we also expect our EBITDA margin to be in the upper half of the original guidance range of 19% to 21% on a full year basis. That is, we expect our EBITDA margin to come in at between 20% and 21% this year.

Speaker #4: That means we are now expecting revenue growth of between 5% and 9% for this year. The prime driver is our semi and advanced manufacturing business, where we now expect to develop better than we expected earlier this year.

Speaker #4: Also reflected in this updated guidance is the continuing weakness in our automotive-related businesses, which is very relevant for our MPS business unit. In line with our updated revenue guidance, we also expect our EBITDA margin to be in the upper half of the original guidance range of 19% to 21% on a full-year basis.

Speaker #4: That is, we expect our EBITDA margin to come in at between 20% and 21% this year. We left our guidance on CapEx unchanged, meaning CapEx remains expected to be slightly below last year's levels.

Prisca Havranek-Kosicek: We left our guidance on CapEx unchanged, meaning CapEx remains expected to be slightly below last year's levels. Please be reminded, however, that amongst other things, the main capacity expansion project at the moment relates to our classical optics sites in Jena, where we are working on expanding our high-precision clean room production, which mainly relates to our semiconductor inspection business. With that, I would like to thank you and hand back to our moderator to start the Q&A session.

Prisca Havranek: We left our guidance on CapEx unchanged, meaning CapEx remains expected to be slightly below last year's levels. Please be reminded, however, that amongst other things, the main capacity expansion project at the moment relates to our classical optics sites in Jena, where we are working on expanding our high-precision clean room production, which mainly relates to our semiconductor inspection business. With that, I would like to thank you and hand back to our moderator to start the Q&A session.

Speaker #4: Please be reminded, however, that among other things, the main capacity expansion project at the moment relates to our classical optics sites in Vienna, where we are working on expanding our high-precision cleanroom production, which mainly relates to our semi-inspection business.

Speaker #4: And with that, I would like to thank you and hand back to our moderator to start the Q&A session.

Operator 3: Gentlemen, if you have joined by telephone and would like to ask a question, please press star nine and pound key on your telephone keypad. If you would like to withdraw your question, press star three and pound key. If you are connected online and listening via the web interface, please click the telephone handset button and then the raise hand icon. This will allow you to ask your question verbally as well. One moment for the first question. The first question is from Michael Kuhn from the Deutsche Bank. Mr. Kuhn, your line's open now.

Operator: Gentlemen, if you have joined by telephone and would like to ask a question, please press star nine and pound key on your telephone keypad. If you would like to withdraw your question, press star three and pound key. If you are connected online and listening via the web interface, please click the telephone handset button and then the raise hand icon. This will allow you to ask your question verbally as well. One moment for the first question. The first question is from Michael Kuhn from the Deutsche Bank. Mr. Kuhn, your line's open now.

Speaker #1: Gentlemen, if you have joined by telephone and would like to ask a question, please press star-nine and the pound key on your telephone keypad.

Speaker #1: If you would like to withdraw your question, press star three and the pound key. If you are connected online and listening via the web interface, please click the telephone handset button and then the raised hand icon.

Speaker #1: This will allow you to ask your question verbally as well. One moment for the first question. The first question is from Michael Kuhn from Deutsche Bank.

Speaker #1: Mr. Kuhn, your line is open now.

Speaker #2: Good morning, thanks for taking my questions. Firstly, two on order intake. You mentioned a bigger, let's call it one-time order in Biophotonics and, let's say, early orders in Semi.

Michael Kuhn: Good morning. Thanks for taking my questions. Firstly, to an order intake, you mentioned a bigger, let's call it one-time order in biophotonics, and let's say early orders in semi. Would there be anything in the semi space which you would regard like a one-time bulk order, or is it just early ordering? Just to get a better idea here.

Speaker #2: Would there be anything in the semi space that you would regard as a one-time bulk order, or is it just early ordering? Just trying to get a better idea here.

Prisca Havranek-Kosicek: Thank you for your question, Michael. Yes, let me reiterate. We have received a large order in Q2 in the biophotonics space relating to our MedTech business. The remarks regarding pull forward orders is less relating to the semi space. It's actually more relating to the biophotonics space in particular, both, I would say, in the defense as well as in the life science and MedTech area.

Prisca Havranek: Thank you for your question, Michael. Yes, let me reiterate. We have received a large order in Q2 in the biophotonics space relating to our MedTech business. The remarks regarding pull forward orders is less relating to the semi space. It's actually more relating to the biophotonics space in particular, both, I would say, in the defense as well as in the life science and MedTech area.

Speaker #1: Thank you for your question, Michael. Yes, let me reiterate: we have received a large order in Q2 in the biophotonics space relating to our MedTech business.

Speaker #1: The remarks regarding pull-forward orders are less related to the semi space. They're actually more related to the biophotonics space in particular, both, I would say, in the defense as well as in the life science and MedTech areas.

Speaker #2: Okay, so semi is kind of the—let's call it—run rate that you would see for now.

Michael Kuhn: Okay. Semi is kind of the, let's call it run rate that you would see for now.

Speaker #1: I think what we have to keep in mind there is that we have had an exceptional annual order that we have already pointed out in Q1.

Prisca Havranek-Kosicek: I think what we have to keep in mind there is that we have had an exceptional annual order that we have already pointed out in Q1, as you remember. While I do not see any particular move forward of orders, I think let me remind you of what general dynamics we have also discussed in our Q1 call, meaning that in a semi ramp-up, of course, it could also be that some customers are putting in orders that are maybe mainly there to secure capacity. As we know, in a ramp-up phase, that is a key criteria. Do not interpret this as a specific pull forward of orders in semi from the H2 into the H1. That remark was mainly meant for the Biophotonics business.

Prisca Havranek: I think what we have to keep in mind there is that we have had an exceptional annual order that we have already pointed out in Q1, as you remember. While I do not see any particular move forward of orders, I think let me remind you of what general dynamics we have also discussed in our Q1 call, meaning that in a semi ramp-up, of course, it could also be that some customers are putting in orders that are maybe mainly there to secure capacity. As we know, in a ramp-up phase, that is a key criteria. Do not interpret this as a specific pull forward of orders in semi from the H2 into the H1. That remark was mainly meant for the Biophotonics business.

Speaker #1: As you remember, and while I do not see any particular move forward of orders, I think, let me remind you of what general dynamics we have also discussed in our Q1 call, meaning that in a semi ramp up, of course, it could also be that some customers are putting in orders that are maybe mainly there to secure capacity, because as we know, in a ramp up phase that is a criteria, but don't interpret this as a specific pull forwards of orders in semi from the first from the second half into the first half.

Speaker #1: That remark was mainly meant for the Biophotonics business.

Speaker #2: Okay, that's very helpful, thank you. Then, on orders—again, if I look at the 60% to 65% conversion of the backlog that you're targeting, that would leave, let's say, roughly €100 million of orders still missing to get to the sales target.

Michael Kuhn: Okay. That is very helpful. Thank you. On orders, again, if I look at the 60% to 65% conversion of the backlog that you are targeting, that would leave, let's say, roughly EUR 100 million of orders still missing to get to the sales target. What visibility do you have by now, and let's say, in which segments you would still need to collect orders turning into sales quickly to deliver on targets?

Speaker #2: What visibility do you have by now, and, let's say, in which segments would you still need to collect orders—turning into sales quickly—to deliver on targets?

Speaker #1: Yeah, thank you for your question, Michael. Now, I mean, with a backlog above $800 million, we have a very, very strong pipeline to execute both for the first half, but then, of course, also into Q2 2027, as you know, right?

Prisca Havranek-Kosicek: Yeah. Thank you for your question, Michael. With above EUR 800 million backlog, we have a very strong backlog to execute both for the H1, but then, of course, also into 2027, as you know. Right? I think to your question, the answer lies on the one hand on the mix, on the other hand, also in the differences between our businesses in the solutions business and the OEM businesses. As you know, the solutions businesses tend to have shorter, I would say, lead times for orders. As we have pointed out, for example, in the MPS business during the course of last year, and that to a large extent, may also be true for this year, that we can still get orders in that then convert into sales still this year, as it is a different cash cycle than we, for example, have in our optics business.

Prisca Havranek: Yeah. Thank you for your question, Michael. With above EUR 800 million backlog, we have a very strong backlog to execute both for the H1, but then, of course, also into 2027, as you know. Right? I think to your question, the answer lies on the one hand on the mix, on the other hand, also in the differences between our businesses in the solutions business and the OEM businesses. As you know, the solutions businesses tend to have shorter, I would say, lead times for orders. As we have pointed out, for example, in the MPS business during the course of last year, and that to a large extent, may also be true for this year, that we can still get orders in that then convert into sales still this year, as it is a different cash cycle than we, for example, have in our optics business.

Speaker #1: So I think, to your question, the answer lies, on the one hand, in the mix, and on the other hand, also in the differences between our businesses—in the Solutions business and the OEM businesses.

Speaker #1: As you know, the solutions business tends to have shorter, I would say, lead times for orders. So, as we have pointed out—for example, in the MPS business during the course of last year, and that to a large extent may also be true for this year—we can still get orders in that then convert into sales still this year.

Speaker #1: As it's a different cash cycle than we, for example, have in our optics business. And that obviously explains the gap that you may see from converting the backlog into revenue—it depends on where you sit yourself in the guidance range.

Prisca Havranek-Kosicek: Yeah. That explains obviously the gap that you may see from converting the backlog into revenue depends on where you sit yourself in the guidance range.

Prisca Havranek: Yeah. That explains obviously the gap that you may see from converting the backlog into revenue depends on where you sit yourself in the guidance range.

Speaker #2: Understood. Excellent. Then absolutely, it does. Last one, on strategy and having listened to the introductory remarks—so, strategic review taking place, no, let's say, findings to be announced before year-end, and you said at the earliest year-end.

Michael Kuhn: Understood. Excellent. Absolutely it does. Last one on strategy and having listened to the introductory remarks. Strategic review taking place. No, let's say, findings to be announced before. Yeah, and you said earliest. That would make me think a CMD at some point over the course of next year. Is that the right way to think about it?

Speaker #2: So that would make me think a CMD at some point over the course of next year. Is that the right way to think about it?

Speaker #1: Yes, let me cover that for Dominic for now. We have said that, at the earliest, it would be at the end of this year, and obviously, at this point, we cannot specify this any further.

Prisca Havranek-Kosicek: Yes. Let me cover that for Dominik for now. We have said that at the earliest, at the end of this year, and obviously at this point, we cannot specify this any further. We are very aware of the requirements of the capital markets to get information. But of course, also please allow for us, as the new executive team, to go through our proper processes. So I can't give you a more specified answer than what we have already said in the call earlier.

Prisca Havranek: Yes. Let me cover that for Dominik for now. We have said that at the earliest, at the end of this year, and obviously at this point, we cannot specify this any further. We are very aware of the requirements of the capital markets to get information. But of course, also please allow for us, as the new executive team, to go through our proper processes. So I can't give you a more specified answer than what we have already said in the call earlier.

Speaker #1: We are very aware of the requirements of the capital markets to get information, but of course, also please allow us, as the new executive team, to go through our proper processes.

Speaker #1: So, I can't give you a more specific answer than what we have already said in the call earlier.

Speaker #2: Fair enough. Thank you very much.

Michael Kuhn: Fair enough. Thank you very much.

Speaker #1: Thank you. The next question is from Maisa Casquez from OdoBHF. Your line is open now.

Andreas Theisen: Thank you. The next question is from Maysa Keskes from Oddo BHF. Your line is open now.

Operator: Thank you. The next question is from Maysa Keskes from Oddo BHF. Your line is open now.

Speaker #3: Good morning, everyone. Thank you for taking my question. I have a question regarding ProDomax. Could you provide more color on the business? It appears that the business saw some order intake in Q2 as well.

Maysa Keskes: Good morning, everyone. Thank you for taking my question. I will ask regarding Prodomax. Could you provide more colors on the business? It appears that the business saw some order intake in Q2 as well. Should we view this as an early sign that the situation is improving or it is still early to call a sustained positive trend?

Maissa Keskes: Good morning, everyone. Thank you for taking my question. I will ask regarding Prodomax. Could you provide more colors on the business? It appears that the business saw some order intake in Q2 as well. Should we view this as an early sign that the situation is improving or it is still early to call a sustained positive trend?

Speaker #3: Should we view this as an early sign that the situation is improving, or is it still too early to call it a sustained positive trend?

Speaker #1: Thank you for your question, Maisa. So, I think it is a similar answer to the one I gave you in the Q1 call, and that is, it is encouraging.

Prisca Havranek-Kosicek: Thank you for your question, Maysa. I think it is a similar answer that I have given you on the Q1 call, and that is, it is encouraging, you are fully right, that we see an uptick of orders also in Q2 after also an uptick of orders in Q1. Bear in mind that we have seen before that four to six quarters with very, very subdued order development. However, I would not call this a trend yet. The geopolitical and economic situation for the end market in North America has not changed in any substance that I am aware of. While I am encouraged by the trajectory we have seen in Q2, I think it is too early to call this a trend. On our strategic intent, maybe also preempting that question, nothing has changed on the strategic intent to divest this business over the course of time.

Prisca Havranek: Thank you for your question, Maysa. I think it is a similar answer that I have given you on the Q1 call, and that is, it is encouraging, you are fully right, that we see an uptick of orders also in Q2 after also an uptick of orders in Q1. Bear in mind that we have seen before that four to six quarters with very, very subdued order development. However, I would not call this a trend yet. The geopolitical and economic situation for the end market in North America has not changed in any substance that I am aware of. While I am encouraged by the trajectory we have seen in Q2, I think it is too early to call this a trend. On our strategic intent, maybe also preempting that question, nothing has changed on the strategic intent to divest this business over the course of time.

Speaker #1: You're fully right that we see an uptick of orders also in Q2, after also an uptick of orders in Q1. Bear in mind that we have seen before that four to six quarters with very, very subdued order development.

Speaker #1: However, I wouldn't call this a trend yet. The geopolitical and economic situation for the end market in North America has not changed in any substantive way that I'm aware of.

Speaker #1: So I would, while I'm encouraged by the trajectory we've seen in Q2, I think it's too early to call this a trend. And on our strategic intent, maybe also preempting that question, nothing has changed on the strategic attempt intent to divest this business over the course of time.

Speaker #3: Okay, thank you.

Maysa Keskes: Okay. Thank you.

Maissa Keskes: Okay. Thank you.

Speaker #1: The next question is from Martin Jungfleisch from BNB Paragraph. Mr. Jungfleisch, your question.

Andreas Theisen: The next question is from Martin Jungfleisch from BNP Paribas. Mr. Jungfleisch.

Operator: The next question is from Martin Jungfleisch from BNP Paribas. Mr. Jungfleisch.

Martin Jungfleisch: Yeah.

Andreas Theisen: Your question.

Operator: Your question.

Martin Jungfleisch: Yeah. Hi, good morning. Maybe to start, just on demand in the semi space, if you can just talk about briefly how your discussions with your main litho and inspection customers have developed over the last few weeks. Are they signaling increasing demand going into 2027? Are they asking for more capacity? Are they worried about not having enough supply? And then also, I guess if you would say that visibility has extended into 2027. That's the first question.

Speaker #4: Yeah, hi, good morning. Maybe to start, just on demand and the semi space, if you can just talk briefly about how your discussions with your main litho and inspection customers have developed over the last few weeks.

Speaker #4: Are they signaling increasing demand going into 2027? Are they asking for more capacity? Are they worried about not having enough supply? And then also, I guess, would you say that visibility has extended into 2027?

Speaker #4: That's the first question.

Speaker #1: Thank you, Martin, for your question. And I'll definitely try to give you a little bit more color around the dynamics of the demand in semi.

Prisca Havranek-Kosicek: Thank you, Martin, for your question, and I'll definitely try to give you a little bit more color around the dynamics of the demand in semi. Now, I think maybe starting with the obvious, you've seen in this year that the lithography business has recorded very strong orders, and of course, it's also a revenue driver out in the H1. You know that we have gone through the supply chain, let's say, adjustments that we went through 2025, and we now expect to grow the lithography business. Nothing changed there. If you ask me, change in order dynamic or let's say, demand between Q1 and Q2, I would say it's broadly the same dynamic that we've been seeing since early of the year. On your question about visibility, I think we are in the semi business, keep that in mind, right?

Prisca Havranek: Thank you, Martin, for your question, and I'll definitely try to give you a little bit more color around the dynamics of the demand in semi. Now, I think maybe starting with the obvious, you've seen in this year that the lithography business has recorded very strong orders, and of course, it's also a revenue driver out in the H1. You know that we have gone through the supply chain, let's say, adjustments that we went through 2025, and we now expect to grow the lithography business. Nothing changed there. If you ask me, change in order dynamic or let's say, demand between Q1 and Q2, I would say it's broadly the same dynamic that we've been seeing since early of the year. On your question about visibility, I think we are in the semi business, keep that in mind, right?

Speaker #1: Now, I think maybe starting with the obvious: you've seen this year that the lithography business has recorded very strong orders. And, of course, it's also been a revenue driver in the first half.

Speaker #1: And you know that we have gone through the supply chain, let's say, adjustments that we went through in 2025, and we now expect to grow a little in the lithography business.

Speaker #1: So nothing changed there. If you ask me about the change in order dynamics or, let's say, demand between Q1 and Q2, I would say it's broadly the same dynamic that we've been seeing since the early part of the year.

Speaker #1: And on your question about visibility, I think we are in the semi business—keep that in mind, right? Things, as you have seen, can change.

Prisca Havranek-Kosicek: Things as we have seen can change and I cannot give you any more flavor on to more or less visibility into the next coming quarters on the lithography business. Overall, of course, we are, maybe let me finish with that. Overall, of course, we see this as a proof point that the semi ramp-up is in full swing. I have also mentioned that earlier in the call, and we will support our customers and focus on the ability to deliver this system.

Prisca Havranek: Things as we have seen can change and I cannot give you any more flavor on to more or less visibility into the next coming quarters on the lithography business. Overall, of course, we are, maybe let me finish with that. Overall, of course, we see this as a proof point that the semi ramp-up is in full swing. I have also mentioned that earlier in the call, and we will support our customers and focus on the ability to deliver this system.

Speaker #1: And I cannot give you any more flavor or more or less visibility into the next coming quarters on the lithography business. Overall, of course, we are—maybe let me finish with that.

Speaker #1: Overall, of course, we see this as a proof point that the Semi ramp-up is in full swing. I’ve also mentioned that earlier in the call.

Speaker #1: And we will support our customers and focus on the ability to deliver, basically.

Speaker #4: Okay, no, that makes sense. And then I guess, are customers increasingly worried about supply? I mean, you mentioned some capacity topics in the prepared remarks. Can you maybe also discuss capacities—how does that look today in inspection and lithos?

Martin Jungfleisch: Okay. No, that makes sense. I guess are customers increasingly worried about supply? You mentioned some capacity topics in your prepared remarks. Can you maybe discuss also on capacities, how does that look like today in inspection and litho?

Speaker #1: Yeah.

Prisca Havranek-Kosicek: Yeah.

Prisca Havranek: Yeah.

Speaker #4: But both physically, the space, but also on headcount.

Martin Jungfleisch: Both physically, the space, but also on headcount.

Speaker #1: Yeah. So let me remind you, as I also mentioned earlier in this call, we have specified our guidance to the upper half and have explicitly mentioned that this is, among other things, based on a better-than-expected performance in the semi business.

Prisca Havranek-Kosicek: Yeah. Let me remind you, as I have also mentioned earlier in this call, we have specified our guidance to the upper half, and have explicitly mentioned that it is, amongst other things, based on a better than expected performance in the semi business. That is clearly one large driver of the specified guidance in the upper range. That means we expect, I would say, a higher growth in our semi outputs in this year, and of course, also a step-up implied into the H2 of this year. That means we, of course, have capacities. As you know, we have a broad production footprint, and as you know, capacity and loading and also mix is not the same across the system.

Prisca Havranek: Yeah. Let me remind you, as I have also mentioned earlier in this call, we have specified our guidance to the upper half, and have explicitly mentioned that it is, amongst other things, based on a better than expected performance in the semi business. That is clearly one large driver of the specified guidance in the upper range. That means we expect, I would say, a higher growth in our semi outputs in this year, and of course, also a step-up implied into the H2 of this year. That means we, of course, have capacities. As you know, we have a broad production footprint, and as you know, capacity and loading and also mix is not the same across the system.

Speaker #1: So that is clearly one large driver of the specified guidance in the upper range. So that means we expect, I would say, a higher growth in our semi outputs this year.

Speaker #1: And of course, also a step-up implied into the second half of this year. So that means we, of course, have capacities. As you know, we have a broad production footprint.

Speaker #1: And as you know, capacity and loading, and also mix, is not the same across the system. So, we are doing our best to obviously balance the demand as best as we can.

Prisca Havranek-Kosicek: We are doing our best to obviously balance the demand as best as we can, and are adding capacities in the terms of people and machinery where needed. Having said that, a ramp-up in semi is always a team effort between the customers, us as suppliers, and our supply chain. I think we have a good momentum going there, basically due to cater to that demand.

Prisca Havranek: We are doing our best to obviously balance the demand as best as we can, and are adding capacities in the terms of people and machinery where needed. Having said that, a ramp-up in semi is always a team effort between the customers, us as suppliers, and our supply chain. I think we have a good momentum going there, basically due to cater to that demand.

Speaker #1: And we are adding capacities in terms of people and machinery where needed. Having said that, a ramp-up in semi is always a team effort between the customers, us as suppliers, and our supply chain.

Speaker #1: And I think we have good momentum going there, basically to cater to that demand.

Speaker #4: Okay, cool. And then maybe my final question is really on photonics. If you can just talk about your microlens arrays a bit. I mean, demand must be quite strong given what's happening in the data center space.

Martin Jungfleisch: Okay. Cool. Then maybe my final question is really on photonics. If you can just talk about your microlens arrays a bit. Demand must be quite strong given what is happening in the data center space. Can you just provide some color how this business has performed in H1 and also on the capacity point, if you have enough capacity really to cater for demand in the next one or two years? Then also in terms of customers, can you talk about the number of customers you have in this business, and if you have seen additional customers actually coming to you and asking for products?

Speaker #4: Can you just provide some color on how this business has performed in H1, and also on the capacity point? Do you have enough capacity to really cater for demand in the next one or two years? And then, also in terms of customers, can you talk about the number of customers you have in this business?

Speaker #4: And have you seen additional customers actually coming to you and asking for a product?

Speaker #1: Yeah, just so I get that right, you were referring to the microlens arrays that relate to our optical data communications business, correct?

Prisca Havranek-Kosicek: Yeah. Just that I get that right, you were referring to the microlens arrays that relate to our optical data communications business, correct?

Prisca Havranek: Yeah. Just that I get that right, you were referring to the microlens arrays that relate to our optical data communications business, correct?

Martin Jungfleisch: Right.

Speaker #1: Yes. Okay, thank you for the clarification. Yeah, what I would reiterate also what we have discussed, giving more a bit more flavor is that we see a growth in demand in that business.

Prisca Havranek-Kosicek: Yes. Okay. Thank you for the clarification. Yeah. What I would reiterate, also what we have discussed, giving a bit more flavor, is that we see a growth in demand in that business. We are also seeing a growth in revenues. I have mentioned that in my remarks, obviously on a significantly smaller base, but it is supportive. We will be growing. We cater to multiple customers. So there is obviously not one customer, but we have an array of customers there. On any more longer-term or strategic considerations regarding that business, I would ask you to allow us to do our strategy update process and then potentially communicate more when we have the time at a, let us say, at a capital market day or something like that.

Prisca Havranek: Yes. Okay. Thank you for the clarification. Yeah. What I would reiterate, also what we have discussed, giving a bit more flavor, is that we see a growth in demand in that business. We are also seeing a growth in revenues. I have mentioned that in my remarks, obviously on a significantly smaller base, but it is supportive. We will be growing. We cater to multiple customers. So there is obviously not one customer, but we have an array of customers there. On any more longer-term or strategic considerations regarding that business, I would ask you to allow us to do our strategy update process and then potentially communicate more when we have the time at a, let us say, at a capital market day or something like that.

Speaker #1: We are also seeing a growth in revenues. I’ve mentioned that in my remarks, obviously on a significantly smaller base, but it is supportive. And we will be growing on any other, and we cater to multiple customers.

Speaker #1: So, there is obviously not just one customer; we have an array of customers there. On any more long-term or strategic considerations with that, regarding that business, I would ask you to allow us to do our strategy update process and then potentially communicate more when we have the time at, let's say, a Capital Markets Day or something like that.

Speaker #4: Okay, sounds good. It's included in the process. Okay, thank you.

Martin Jungfleisch: Okay. Sounds good. It is included in the process. Okay, thank you.

Speaker #1: Next question is from Olivier Calvet from UBS. Your line is open now.

Andreas Theisen: Next question is from Olivier Calvet from UBS. Your line is open now.

Operator: Next question is from Olivier Calvet from UBS. Your line is open now.

Speaker #2: Yeah, hi Prisca. Welcome, Dominique. Just a couple of follow-ups left. Maybe firstly on the order intake, so should we understand your comments in semis as implying you do expect semis order intake to remain at this level of, let’s call it, €170–180 million seen in Q1 and Q2? Appreciate the little double-digit sort of one-off in Q1.

Olivier Calvet: Yeah. Hi, Priska. Welcome, Dominik. Just a couple of follow-ups left. Maybe firstly on the order intake. Should we understand your comments in semis as implying you do expect semis order intake to remain at this level of, let's call it EUR 170 million, EUR 180 million seen in Q1 and Q2? Appreciate the little double digit sort of one-off in Q1. That would be the first question. Then, if you could comment on your current utilization levels in the inspection and lithography operations, respectively, that would be also helpful. If you could comment, I think you said you expect to convert 60% to 65% of your backlog at group level into sales in full-year 2026. Just wanted to confirm if this was also the case for your semis backlog. That would be question sort of 2 and 3. Thanks.

Speaker #2: That would be the first question. And then, if you could comment on your current utilization levels in the inspection and lithography operations, respectively, that would also be helpful.

Speaker #2: And if you could comment—I think you said you expect to convert 60 to 65 percent of your backlog at the group level into sales in full year ’26.

Speaker #2: Just wanted to confirm if this was also the case for your semis backlog. That would be a question, sort of, two and three. Thanks.

Prisca Havranek-Kosicek: Then maybe let me start with the last question first. As I said before, we have a strong backlog, in particular in the semi space, given the order intake that you have seen. The name of the game for the upcoming quarters, particularly in the OEM business, is execution and output. That is, of course, next to the mix and the loading in the plants, what determines the end of the year, and not so much any, let's say, major gaps in backlog. In the solution businesses, we have a different business dynamic, and as I answered the question before, we, as normal, have there, of course, a shorter time to convert orders into revenue. That is what that relates to. As you know.

Prisca Havranek: Then maybe let me start with the last question first. As I said before, we have a strong backlog, in particular in the semi space, given the order intake that you have seen. The name of the game for the upcoming quarters, particularly in the OEM business, is execution and output. That is, of course, next to the mix and the loading in the plants, what determines the end of the year, and not so much any, let's say, major gaps in backlog. In the solution businesses, we have a different business dynamic, and as I answered the question before, we, as normal, have there, of course, a shorter time to convert orders into revenue. That is what that relates to. As you know.

Speaker #1: Then maybe let me start with the last question first. So, as I said before, we have a strong backlog, in particular in the semi space, given the order intake that you've seen.

Speaker #1: So the name of the game for the upcoming quarters, particularly in the OEM business, is execution and output. That is, of course, in addition to the mix and the loading in the plants, what determines the end of the year.

Speaker #1: And not so much any, let's say, major gaps in backlog. In the Solution Businesses, we have a different business dynamic. And as I answered the question before, we, as normal, have there, of course, a shorter time to convert orders into revenue.

Speaker #1: So that's what relates to it. As you know, on the utilization levels, as I said before, we have different loading levels across our factory footprint.

Prisca Havranek-Kosicek: On the utilization levels, as I said before, we have different loading levels across our factory footprint, and what we are doing is adding machines and people for the near term. You will also see that basically coming into the system into the H2 of the year as we are continuing our ramp up. You know that we have a fairly new factory in Dresden, right? We know that, and you remember that we were ramping it a little bit slower than we were initially anticipating when we came online with the factory beginning of last year. Now we are, of course, adding also to the ramp curve there in Dresden. We have, I would say, in the classical optics in Jena, as you know, we have already made a small capacity expansion at the beginning of this year.

Prisca Havranek: On the utilization levels, as I said before, we have different loading levels across our factory footprint, and what we are doing is adding machines and people for the near term. You will also see that basically coming into the system into the H2 of the year as we are continuing our ramp up. You know that we have a fairly new factory in Dresden, right? We know that, and you remember that we were ramping it a little bit slower than we were initially anticipating when we came online with the factory beginning of last year. Now we are, of course, adding also to the ramp curve there in Dresden. We have, I would say, in the classical optics in Jena, as you know, we have already made a small capacity expansion at the beginning of this year.

Speaker #1: And what we are doing is adding machines and people for the near term. You'll also see that's basically coming into the system in the second half of the year, as we are sort of continuing our ramp-up.

Speaker #1: You know that we have a fairly new factory in Dresden, right? So we know that. And you remember that we were ramping it a little bit slower than we were initially anticipating when we came online with the factory beginning last year.

Speaker #1: So now we are, of course, also adding to the ramp curve there in Dresden. We have, I would say, in the classical optics in Jena, as you know, already made a small capacity expansion at the beginning of this year.

Speaker #1: And as I've also alluded to, we are working on additional capacity for the classical optics. And by the way, this caters both to inspection and lithography customers here in Jena; that's underway.

Prisca Havranek-Kosicek: As I have also alluded, we are working on additional capacity for the classical optics. By the way, this caters both to inspection and lithography customers here in Jena that is underway.

Prisca Havranek: As I have also alluded, we are working on additional capacity for the classical optics. By the way, this caters both to inspection and lithography customers here in Jena that is underway.

Speaker #2: And can I ask? Can I ask just on that—the timing of the expansion in Jena?

Olivier Calvet: Can I ask just on that, the timing of the expansion in Jena?

Speaker #1: So, as you know, we have had an additional facility coming online at the beginning of this year. And I would expect any additional facilities not to be affecting the next couple of quarters.

Prisca Havranek-Kosicek: We have had an additional facility coming online in the beginning of this year, and I would expect any additional facilities not to be affecting the next couple of quarters. This will take a little bit of time until we have these facilities ready.

Prisca Havranek: We have had an additional facility coming online in the beginning of this year, and I would expect any additional facilities not to be affecting the next couple of quarters. This will take a little bit of time until we have these facilities ready.

Speaker #1: This will take a little bit of time until we have these facilities ready.

Speaker #2: Thanks. And then, on the order intake level in semis in the second half?

Olivier Calvet: Thanks. Then on the order intake level in semis in the H2?

Speaker #1: Yeah, I know. I think I’ve cautioned in the prepared remarks that, obviously, with a record level that you see at the moment in semi, we cannot necessarily expect the same record, exceptional levels.

Prisca Havranek-Kosicek: Yeah, I know. I think I've cautioned in the prepared remarks that obviously with the record level that you see at the moment in semi, we cannot necessarily expect the same record exceptional levels. That doesn't mean that we don't expect good demand in semi for the upcoming quarters as a result of the ongoing semi ramp in the industry.

Prisca Havranek: Yeah, I know. I think I've cautioned in the prepared remarks that obviously with the record level that you see at the moment in semi, we cannot necessarily expect the same record exceptional levels. That doesn't mean that we don't expect good demand in semi for the upcoming quarters as a result of the ongoing semi ramp in the industry.

Speaker #1: That doesn't mean that we don't expect good demand in semi for the upcoming quarters as a result of the ongoing semi ramp in the industry.

Speaker #2: Okay, thanks.

Olivier Calvet: Okay, thanks.

Prisca Havranek-Kosicek: But

Prisca Havranek: But

Speaker #1: Next question is from Lasse Stuben from Bernberg. Your question.

Operator 3: Next question is from Lasse Stüben from Berenberg. Your question.

Operator: Next question is from Lasse Stüben from Berenberg. Your question.

Speaker #4: Hi, good morning. Could you just give a bit more color on that multi-year order in MedTech, just to get a flavor of what that is and which end market we're looking at here?

Lasse Stüben: Hi, good morning. Could you just give a bit more color on that multi-year order in MedTech, just to get a flavor of what that is and which end market we are looking at here? The second question would be on the margin level in Semiconductor & Advanced Manufacturing, very strong in Q2. I guess not that surprising given the uptick in revenues, but just wondering if there is any key drivers there, be it volume or mix or a combination of both. Then finally on MPS, if you could touch on this briefly. Revenues were quite soft, as you mentioned in the quarter, but orders were actually slightly better.

Speaker #4: The second question would be on the margin level in semicon—very strong, or in advanced manufacturing. Very strong in Q2. I guess not that surprising given the uptick in revenues, but just wondering if there's any key drivers there, be it volume or mix, or a combination of both.

Speaker #4: And then finally on MPS, if you could touch on this briefly. Revenues were quite soft, as you mentioned, in the quarter, but then orders were actually slightly better.

Speaker #4: So just wondering sort of what the key drivers are here, and if that kind of €40 million run-rate in the quarter of revenues is what we should be expecting for the coming quarters, or maybe a slight uptick given the increase in orders in Q2.

Lasse Stüben: Just wondering what the key drivers are here, and if that EUR 40 million run rate in the quarter of revenues is what we should be expecting for the coming quarters or maybe a slight uptick given the increase in orders in Q2. Thank you.

Speaker #4: Thank you.

Speaker #1: Yeah, yeah, of course, Lasse. Thank you for your question. Let me start with the MPS question. I think the main message here from my side is that we expect a better H2 compared to a modest H1.

Prisca Havranek-Kosicek: Yeah. Of course, Lasse, thank you for your question. Let me start with the MPS question. I think the main message here from my side is that we expect a better H2 compared to a modest H1. That is driven by both, all lines of businesses there. So both the optical testing as well as the automotive-related businesses. That is true for that. Also historically, if you look at the, we tend to see a certain seasonality in that business towards the Q3 and even the Q4. So I expect a better second half there. Having said that, you have also seen in my remarks that we still see, I would say, a deterioration of the demand situation in automotive compared to what our expectations were when we started the year. We have also factored that into our updated or specified guidance.

Prisca Havranek: Yeah. Of course, Lasse, thank you for your question. Let me start with the MPS question. I think the main message here from my side is that we expect a better H2 compared to a modest H1. That is driven by both, all lines of businesses there. So both the optical testing as well as the automotive-related businesses. That is true for that. Also historically, if you look at the, we tend to see a certain seasonality in that business towards the Q3 and even the Q4. So I expect a better second half there. Having said that, you have also seen in my remarks that we still see, I would say, a deterioration of the demand situation in automotive compared to what our expectations were when we started the year. We have also factored that into our updated or specified guidance.

Speaker #1: And that is driven by all lines of business there, so both the optical testing as well as the automotive-related businesses. That is true for that.

Speaker #1: And also, historically, if you look at it, we tend to see a certain seasonality in that business towards the third and even the fourth quarter.

Speaker #1: So I expect a better second half there. Having said that, you've also seen in my remarks that we still see, I would say, a deterioration of the demand situation in automotive compared to what our expectations were when we started the year.

Speaker #1: And we've also factored that into our updated or specified guidance. The order intake situation is actually quite encouraging, and that is basically, of course, one of the reasons why I am expecting a stronger second half than the first half across the MPS.

Prisca Havranek-Kosicek: The order intake situation is actually quite encouraging, and that basically is, of course, one of the reasons why I am expecting a stronger second half than the first half across the MPS. On your question on the large annual order in the biophotonics business, I am a bit in a bind here, I am afraid. You know that we have a concentrated key account strategy here with key account customers. So what I can tell you is it is in the MedTech space, not in the life science space, and it is not in the dental space. But I am afraid I cannot give you more flavor on that. I hope that helps anyway.

Prisca Havranek: The order intake situation is actually quite encouraging, and that basically is, of course, one of the reasons why I am expecting a stronger second half than the first half across the MPS. On your question on the large annual order in the biophotonics business, I am a bit in a bind here, I am afraid. You know that we have a concentrated key account strategy here with key account customers. So what I can tell you is it is in the MedTech space, not in the life science space, and it is not in the dental space. But I am afraid I cannot give you more flavor on that. I hope that helps anyway.

Speaker #1: On your question about the large annual order in the biophotonics business, I'm a bit in a bind here, I'm afraid. You know that we have a concentrated key account strategy with key account customers.

Speaker #1: So what I can tell you is, it is in the MedTech space, not in the life science space, and it's not in the dental space.

Speaker #1: But I am afraid I cannot give you more flavor on that. I hope that helps. Anyway, and then on margin level in Semi, you're right.

Prisca Havranek-Kosicek: And then on margin level in Semi, you are right, and we have seen a nice margin accretion in Semi, as we have also expected and as we have also previously alluded to, if Semi is firing on all cylinders, obviously, we can also land a tad above the, let us say, the 30% range that we roundabout have sort of put out there. So, I am confident that the good development that we have seen in the H1, we will also continue to see in the H2. Bear in mind, however, that of course, certain lag effects we will see in factor costs there, for example, the collective agreement in Germany that kicked in in Q2, and also certain other factor costs, including obviously additional FTEs that we will see coming online over the next couple of quarters. But overall, I would say happy with the profitability development and the margin development in Semi.

Prisca Havranek: And then on margin level in Semi, you are right, and we have seen a nice margin accretion in Semi, as we have also expected and as we have also previously alluded to, if Semi is firing on all cylinders, obviously, we can also land a tad above the, let us say, the 30% range that we roundabout have sort of put out there. So, I am confident that the good development that we have seen in the H1, we will also continue to see in the H2. Bear in mind, however, that of course, certain lag effects we will see in factor costs there, for example, the collective agreement in Germany that kicked in in Q2, and also certain other factor costs, including obviously additional FTEs that we will see coming online over the next couple of quarters.

Speaker #1: And we've seen a nice margin accretion in semi. As we have also expected, and as we have also previously alluded to, if semi is firing on all cylinders, obviously we can also land a tad above the, let's say, the 30% range that we round about have sort of put out there.

Speaker #1: So, I'm confident that the good development we've seen in the first half, we will also continue to see in the second half. Bear in mind, however, that, of course, certain lag effects we will see in factor costs.

Speaker #1: For example, the collective agreement in Germany that kicked in in Q2, and also certain other factor costs, including, obviously, additional FTEs that we'll see coming online over the next couple of quarters.

Speaker #1: But overall, I would say I am happy with the profitability development and the margin development in Semi. I hope that helps answer your question.

Prisca Havranek: But overall, I would say happy with the profitability development and the margin development in Semi. I hope that helps answer your question.

Prisca Havranek-Kosicek: I hope that helps answer your question.

Speaker #4: Very good. Thanks very much.

Lasse Stüben: Very good. Thanks very much.

Speaker #1: Next question is from Craig Abbott from Kepler Chevreux. Your line is now open.

Operator 3: Next question is from Craig Abbott from Kepler Cheuvreux. Your line is now open.

Operator: Next question is from Craig Abbott from Kepler Cheuvreux. Your line is now open.

Speaker #2: Yeah, hi, good morning. Good morning, everyone. I have three remaining questions on my side. Actually, I had earlier a number of questions about the ramp-up of capacity at the micro-optics plant in Dresden, but a lot of that has been answered.

Craig Abbott: Yeah. Hi, good morning, Priska. Good morning, everyone. Yeah, three remaining questions on my side. Actually, I had earlier a number of questions about the ramp-up of capacity at the Microoptics plant in Dresden, but a lot of that has been answered. I just want to do a quick follow-up there because we are seeing quite significant capacity increases by other semi equipment suppliers. We are talking magnitude 25%, 30% quarter on quarter sometimes. I just want to one last question on that front is, are you able to find the headcount that you need, the FTEs that you need, particularly with a view to 2027? We all know how dynamic the WFE CapEx forecasts for next year are. Also, if you feel comfortable that your supply chain is going to be able to keep pace in terms of expanding their capacities as well. That would be the first question.

Speaker #2: I just want to do a quick follow-up there, because we're seeing quite significant capacity increases by other semi equipment suppliers. I mean, we're talking magnitudes of 25, 30 percent quarter-on-quarter sometimes.

Speaker #2: And I just want to ask one last question on that front: Are you able to find the headcount that you need—the FTEs that you need?

Speaker #2: Particularly with a view to '27, we all know how dynamic the WFE CapEx forecasts for next year are. And also, if your supply chain is able, do you feel comfortable that your supply chain is going to be able to keep pace in terms of expanding their capacities as well?

Speaker #2: That would be the first question. The second question, please. Just to remind us again, both in your—well, probably not in the psychography, but on the inspection side—is your optics supplying in any way to Chinese semi equipment OEMs?

Craig Abbott: The second question, please. Just to remind us again, both in lithography, well, probably not in lithography, but in the inspection side, is Jenoptik supplying in any way to Chinese semi equipment OEMs? If not, is this an issue the company is trying to address, and could you maybe share with us your chances there, being able to become part of that ecosystem? Thirdly, in the defense optics, I suppose demand trends remain strong, but if you could give us some color on how you see them continuing in H2 and into 2027, would appreciate it. Thank you.

Speaker #2: And if not, is this an issue the company is trying to address? And could you maybe share with us your chances there—being able to become part of that ecosystem?

Speaker #2: And thirdly, in the defense optics, I suppose the main trends remain strong, but if you could give us some color on how you see them continuing in H2 and into '27, we'd appreciate it.

Speaker #2: Thank you.

Speaker #1: Craig, thank you for your questions. Maybe I'll start with the semi first. On the FTE for Dresden, so I can, in general, find enough people at this point.

Prisca Havranek-Kosicek: Thank you for your questions. Maybe I will start with the semi first, on the FTE for Dresden. Can we in general find enough people at this point? I would say the general answer is yes. Yeah, of course, skilled operators are not always easy to find. We have our apprenticeship program, which of course we are also stepping up. So by and large, I would say we have an okay labor situation where we are able to staff the positions that we require. On your question or your sub-question on the supply chain now, the broad expectation is that our supply chain continues to ramp up, basically in lockstep with us, right? That is the general aim. For now, I would also say that we are not tangibly constrained anywhere in the supply chain.

Prisca Havranek: Thank you for your questions. Maybe I will start with the semi first, on the FTE for Dresden. Can we in general find enough people at this point? I would say the general answer is yes. Yeah, of course, skilled operators are not always easy to find. We have our apprenticeship program, which of course we are also stepping up. So by and large, I would say we have an okay labor situation where we are able to staff the positions that we require. On your question or your sub-question on the supply chain now, the broad expectation is that our supply chain continues to ramp up, basically in lockstep with us, right? That is the general aim. For now, I would also say that we are not tangibly constrained anywhere in the supply chain.

Speaker #1: And I would say the general answer is yes. Yeah, of course, skilled operators are not always easy to find. We have our apprenticeship program, which of course we are also stepping up.

Speaker #1: So, by and large, I would say we have an okay labor situation where we're able to staff the positions that we require. On your question, or your sub-question, on the supply chain...

Speaker #1: Now, I mean, the broad expectation is that our supply chain continues to ramp up, basically in lockstep with us, right? That's the general aim.

Speaker #1: And for now, I would also say that we are not tangibly constrained anywhere in the supply chain. But of course, given the high level of order dynamics that we're seeing, there may be certain risks.

Prisca Havranek-Kosicek: But of course, given the high level of order dynamics that we are seeing, there may be certain risks, and the teams there are certainly working on mitigating those. Yeah. But for now, I see us ramping up basically in lockstep with our supply chain for the major part. I think then you had a question on, I hope I got it right, about inspection sales into potentially China. Did I get that correct?

Prisca Havranek: But of course, given the high level of order dynamics that we are seeing, there may be certain risks, and the teams there are certainly working on mitigating those. Yeah. But for now, I see us ramping up basically in lockstep with our supply chain for the major part. I think then you had a question on, I hope I got it right, about inspection sales into potentially China. Did I get that correct?

Speaker #1: And we are certainly, and the teams there are certainly, working on mitigating those. But for now, I see us ramping up basically in lockstep with our supply chain for the major part.

Speaker #1: I think, then, you had a question on—if I hope I got it right—about inspection, sales into potentially China. Did I get that correct?

Speaker #2: Yeah, directly. Directly to the Chinese semi equipment OEMs, not indirectly by the Western OEMs.

Craig Abbott: Yeah, directly to the Chinese semi equipment OEMs, not indirectly via the Western OEMs.

Speaker #1: Yeah, yeah, yeah. Okay, thank you for clarifying, Craig. So, by and large, we do not sell to Chinese suppliers overall in our semi business.

Prisca Havranek-Kosicek: Yeah. Okay, thank you for clarifying, Craig. We do not sell to Chinese suppliers overall in our semi business. That is a strategic decision that we made a couple of years ago, and for now, that decision is intact. That is across our semi business, I should say. Then last question, defense optics, if I got that correctly.

Prisca Havranek: Yeah. Okay, thank you for clarifying, Craig. We do not sell to Chinese suppliers overall in our semi business. That is a strategic decision that we made a couple of years ago, and for now, that decision is intact. That is across our semi business, I should say. Then last question, defense optics, if I got that correctly.

Speaker #1: That's a strategic decision that we made a couple of years ago, and for now, you know, that decision is intact. That's across our semi business, I should say.

Speaker #1: And then, last question—defense optics, if I got that correctly.

Speaker #2: That's correct, yes.

Craig Abbott: That is correct, yeah.

Speaker #1: Yes, thank you, Craig. So, I mean, defense has been strong. You've seen that, right? And, having said that, defense orders tend to be, let's say, sometimes concentrated and sometimes multi-year in nature.

Prisca Havranek-Kosicek: Yes. Thank you, Craig. Defense has been strong, we have seen that, right? Having said that, defense orders tend to be, let us say, sometimes concentrated and sometimes multi-year in nature. I would expect over the short to medium term, the defense optics business to grow. Obviously from a revenue point of view, that is clear, but also from an order intake dynamic, what I would say is don't extrapolate the Biophotonics order intake for the future. Because as I said, there are various factors to keep in mind there. But overall, I would say fairly bullish on the defense dynamics. I hope that gives you some flavor.

Prisca Havranek: Yes. Thank you, Craig. Defense has been strong, we have seen that, right? Having said that, defense orders tend to be, let us say, sometimes concentrated and sometimes multi-year in nature. I would expect over the short to medium term, the defense optics business to grow. Obviously from a revenue point of view, that is clear, but also from an order intake dynamic, what I would say is don't extrapolate the Biophotonics order intake for the future. Because as I said, there are various factors to keep in mind there. But overall, I would say fairly bullish on the defense dynamics. I hope that gives you some flavor.

Speaker #1: I do not anticipate, let's say—I would say I would expect over the short to medium term, the defense optics business to grow. Obviously, from a revenue point of view, that's clear.

Speaker #1: But also, from an order intake dynamic, what I would say is, don't extrapolate the Buyer Photonics order intake for the future. Because, as I said, there are various factors to keep in mind there.

Speaker #1: But overall, I would say I remain fairly bullish on the defense dynamics. I hope that gives you some flavor.

Craig Abbott: It does indeed. Thank you very much.

Speaker #2: It does indeed. Thank you very much.

Speaker #1: Gentlemen, at the moment, there seem to be no further questions. Maybe let me quickly repeat the instruction: If you have joined by telephone and would like to ask a question, please press star 9 and the pound key on your telephone keypad.

Operator 3: Gentlemen, at the moment there seem to be no further questions. Maybe let me quickly repeat the instruction. If you have joined by telephone and would like to ask a question, please press star nine and pound key on your telephone keypad. If you are connected online and listening via the web interface, please click the telephone handset button and then the raise hand icon. There is one more question from Martin Jungfleisch from BNP Paribas. Your line is open.

Operator: Gentlemen, at the moment there seem to be no further questions. Maybe let me quickly repeat the instruction. If you have joined by telephone and would like to ask a question, please press star nine and pound key on your telephone keypad. If you are connected online and listening via the web interface, please click the telephone handset button and then the raise hand icon. There is one more question from Martin Jungfleisch from BNP Paribas. Your line is open.

Speaker #1: If you are connected online and listening via the web interface, please click the telephone handset button, and then the raised hand icon. There is one more question from Martin Jungfleisch from Open.

Martin Jungfleisch: Hi again. Maybe if I can add too, if there is time. First one is on TRIOPTICS. Can you talk about what the demand trends you are seeing in AR/VR? I mean, Meta has launched the Ray-Ban glasses. I think Google is coming with new smart glasses as well. It seems like the market has picked up a bit there. I know the business was initially hinging a bit on an uptick in AR/VR. So maybe if you can talk about if you have seen an inflection point there already.

Speaker #3: No, hi again. Maybe if I can add too, if there's time. The first one is on Trioptics. Can you talk about what demand trends you're seeing in AR/VR?

Speaker #3: I mean, Meta has launched the Ray-Ban glasses, and Google is coming out with new smart glasses as well. So it seems like the market has picked up a bit there.

Speaker #3: And I know the business was initially hinging a bit on an uptake in AR/VR. So maybe if you can talk about if you have seen an inflection point there already.

Speaker #1: Thank you for the question, Martin. So, regarding our business in Trioptics, what I would reiterate is a little bit of what I said in Q1.

Prisca Havranek-Kosicek: Thank you for your question, Martin. Regarding our business in TRIOPTICS, what I would reiterate is a little bit what I said in Q1. We do see in the industry broadly more dynamics, which is, I would consider a positive. But we do not anticipate more major order intake from AR, VR in the business in the very near future. But our project list is full, and we are executing on a variety of projects in that space, which of course gives us a nice dynamic overall. The optical testing equipment, of course, that is sort of the legacy TRIOPTICS business, is doing well I would say across, in particular the optical testing space and inspection space.

Prisca Havranek: Thank you for your question, Martin. Regarding our business in TRIOPTICS, what I would reiterate is a little bit what I said in Q1. We do see in the industry broadly more dynamics, which is, I would consider a positive. But we do not anticipate more major order intake from AR, VR in the business in the very near future. But our project list is full, and we are executing on a variety of projects in that space, which of course gives us a nice dynamic overall. The optical testing equipment, of course, that is sort of the legacy TRIOPTICS business, is doing well I would say across, in particular the optical testing space and inspection space.

Speaker #1: We do see in the industry broadly more dynamics, which I would consider a positive. But we do not anticipate more major order intake from AR/VR in the business in the very near future.

Speaker #1: But our project list is full, and we are executing on a variety of projects in that space, which, of course, gives us a nice dynamic.

Speaker #1: Overall, the optical testing equipment—of course, that's sort of the legacy Trioptics business—is doing well. I would say, in particular, across the optical testing space and inspection space.

Martin Jungfleisch: Okay.

Speaker #1: So, I would say there is still a positive. I would say the commentary we provided earlier this year remains intact.

Prisca Havranek-Kosicek: And I would say there is still positive. I would say that the commentary we provided earlier this year remains intact.

Prisca Havranek: And I would say there is still positive. I would say that the commentary we provided earlier this year remains intact.

Speaker #3: Okay, sounds good. And then just secondly, on pricing, there are some semi suppliers that have raised prices over the last couple of months to offset input costs.

Martin Jungfleisch: Okay, sounds good. Then just secondly on pricing, there are some semi suppliers that have raised prices over the last couple of months to offset input costs. Can you talk about potentially some price increases in some of your classical businesses in semis, and if these are offsetting input costs and if input costs are even going up for you?

Speaker #3: And can you talk about potentially some price increases in some of your classical businesses and semis? And if these are offsetting input costs, and if input costs are even going up for you.

Speaker #1: Yeah, yeah. Martin, I understand your interest. However, given the very concentrated nature of our business in semi, as you know, I'm afraid I'll have to be, let's say, a little vague in the color I can give.

Prisca Havranek-Kosicek: Yeah, Martin, I understand your interest. However, given the very concentrated nature of our business in semi, as you know, I am afraid I will be a little, let's say, vague in the color I can give. What I can assure you is that we have very constructive conversations with all of these customers. Of course, depending a little bit also on the demand situation, and that I reiterate what I said around the good profitability we have seen in the semi business overall. But I am afraid I cannot go into any of the commercial details with this customer base here.

Prisca Havranek: Yeah, Martin, I understand your interest. However, given the very concentrated nature of our business in semi, as you know, I am afraid I will be a little, let's say, vague in the color I can give. What I can assure you is that we have very constructive conversations with all of these customers. Of course, depending a little bit also on the demand situation, and that I reiterate what I said around the good profitability we have seen in the semi business overall. But I am afraid I cannot go into any of the commercial details with this customer base here.

Speaker #1: So what I can assure you is that we have very constructive conversations with all of these customers. Of course, depending a little bit also on the demand situation, and I reiterate what I said around the good profitability we've seen in the semi business overall.

Speaker #1: But I'm afraid I cannot go into any of the commercial details with this customer base here.

Speaker #3: Okay, no, that's fair. Thank you.

Martin Jungfleisch: Okay. No, that's fair. Thank you.

Speaker #1: There are no further questions in the queue, so I would like to close the Q&A session now and turn the floor back over to your host, Dr. Preska Hasanic.

Operator 3: There are no further questions in the queue, so I would like to close the Q&A session now and turn the floor back over to your host, Dr. Priska Hafenecker.

Operator: There are no further questions in the queue, so I would like to close the Q&A session now and turn the floor back over to your host, Dr. Priska Hafenecker.

Speaker #4: Thank you very much. And let me close the call by reiterating our key messages. We delivered a solid Q2. The ramp-up in Semi is in full swing, and we see strong customer activity in our Biophotonics business.

Prisca Havranek-Kosicek: Thank you very much. Let me close the call with reiterating our key messages. We delivered a solid Q2. The ramp-up in semi is in full swing, and we see strong customer activity in our Biophotonics business. Although H1 should not be extrapolated into H2, we return to profitable growth in H1, and our near-term focus is on added capacities and our ability to deliver. We have specified our guidance in the upper half of our range. With that, I thank you for attending our call, and I look forward to seeing many of you in the road together with Dominik over the next coming weeks. Thank you very much.

Prisca Havranek: Thank you very much. Let me close the call with reiterating our key messages. We delivered a solid Q2. The ramp-up in semi is in full swing, and we see strong customer activity in our Biophotonics business. Although H1 should not be extrapolated into H2, we return to profitable growth in H1, and our near-term focus is on added capacities and our ability to deliver. We have specified our guidance in the upper half of our range. With that, I thank you for attending our call, and I look forward to seeing many of you in the road together with Dominik over the next coming weeks. Thank you very much.

Speaker #4: Although H1 should not be extrapolated into H2, we returned to profitable growth in H1. Our near-term focus is on added capacities and our ability to deliver.

Speaker #4: We have specified our guidance in the upper half of our range. And with that, I thank you for attending our call, and I look forward to seeing many of you on the road together with Dominic over the next few weeks.

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Half Year 2026 Jenoptik AG Earnings Call

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