Tobii Year-End Report 2022

Press release
Stockholm, February 7, 2023

Tobii AB (publ) today announced its results for the fourth quarter and full year of 2022.

Comment by Tobii’s CEO Anand Srivatsa:

“Tobii delivered a healthy 19 percent organic growth in the quarter and achieved a 19-percentage points year-on-year operating margin improvement, which allowed us to reach the first EBIT profitable quarter since our IPO in 2015.”

Fourth quarter October - December 2022

• Revenue increased 34 % to SEK 262 million (196), corresponding to organic growth of 19 %
• Gross margin increased to 78 % (77 %)
• Operating result (EBIT) was SEK 9 million (-31)
• The net result for the period amounted to SEK -9 million (3,272)
• Earnings per share amounted to SEK -0.08 (31.73)
• Free cash flow amounted to SEK 147 million (23), including SEK 166 million temporary covid related tax reliefs from the Swedish tax authorities

Significant events during the period

• The launch date for Sony PlayStation VR 2 (PSVR2) was set to February 22, 2023, with pre-orders starting from November 15, 2022
• Tobii received two design wins in the quarter. One for a VR solution to detect intoxication and one for a vision skills training solution
• Tobii was top ranked in Allbright´s gender equality report and Tobii´s ESG rating improved to A (BBB) in MSCI´s ESG Ratings report
• Tobii was granted SEK 166 million in additional Covid relief through deferral of tax payments to the Swedish tax authorities, of which SEK 161 million subsequently has been prolonged to February 2024

 

Comments from the CEO

Healthy quarter proving our ability to reach profitability
   Tobii delivered a healthy 19 percent organic growth in the quarter and achieved a 19-percentage points year-on-year operating margin improvement, which allowed us to reach the first EBIT profitable quarter since our IPO in 2015. We achieved this despite our business not hitting on all cylinders, as many of our research customers continued through a belt-tightening phase. Considering the circumstances, I am delighted with this result. It shows the benefit of our diverse portfolio, a healthy operating leverage, and that our efforts to reach profitability have made good progress.

Our Integrations segment continues to show good performance. Revenue increased 59 percent organically and the gross margin improved by 11 percentage points to 88 percent in the quarter. This was driven by a healthy mix of both increased project- and software license revenues.

Despite headwinds in many markets for behavioral studies and research, Products & Solutions reached 2 percent organic growth in the quarter. This was primarily because of a strong finish of the quarter in the Chinese market and a continued growth in our direct-to-consumer PC gaming peripherals. The Chinese market re-opened during the quarter, and we noted a clear increase in demand. It is too early to tell what portion of this result is a post-covid normalization or an effect of pent-up demand.

In the context of a strong fourth quarter, it is important to note that Tobii still faces uncertainty in our Products & Solution business, and that our Integrations business can be lumpy. Therefore, Tobii’s financial performance is best measured over a longer time horizon which allows a more accurate view of the underlying trends. Our free cash flow improved to SEK 145 million (23), which includes a temporary deferral of taxes. This allows us to exit the year with a robust financial position.

Positive momentum in a turbulent year

The year 2022 brought a lot of turbulence which affected organizations worldwide. The post covid return to office work, the weakening of the macro economy and continued supply chain disruptions presented challenges for many companies. In addition, the war in Ukraine directly affected Tobii and, most importantly, our people in the region. While managing through these external disruptions, we were doing significant work to form the “new” Tobii organization after the spin-off of Tobii Dynavox. I am incredibly proud of the work of my colleagues and all that we have achieved while navigating this turmoil. I want to highlight a few of these achievements.

We achieved a top rating in Allbright´s gender diversity study, improved our MSCI ESG rating to A, reached carbon neutrality in our operations in Sweden and received the ISO 27001 certification. 2022 also marked the year in which Tobii reached a major milestone, Tobii´s technology shipping more than one million units in a single calendar year. A promising indicator for the future was the positive reviews that the PSVR2 and its eye tracking performance received and that many games are leveraging our technology for graphics improvements and in game interaction. Lastly, I am enthusiastic about the potential of our automotive DMS solution, which for the first time was evaluated in private & public showcases and is receiving very positive feedback from partners and prospective customers.

Overall, for the full year 2022, Tobii delivered 14 percent organic growth and 14-percentage point operating margin improvement. These numbers validate that we are back in a growth phase and on a trajectory toward profitability.

 

2023 will be a transformational year for Tobii

In 2023, eye tracking will reach mass market adoption for the first time, with millions of users experiencing the technology through the PSVR2. This is a major milestone for Tobii, and it has the potential to spur a wave of eye tracking innovation and uptake outside of VR as well. The Sony PSVR2 sets a new baseline for consumer VR headsets, and the importance of eye tracking is expected to increase for other OEMs. We have good momentum in the XR industry and expect to evolve our engagements with leading OEMs further. I also see significant traction in Automotive and in 2023 our ambition is to close multiple design wins.

Despite the risk of a continued weak macro-environment, we enter 2023 with optimism based on our strengthened underlying business fundamentals. The combination of increased top-line revenue with a focus on controlling costs will enable us to deliver further improvements in profitability in 2023. We remain confident and committed to reaching our financial goal of being EBIT profitable again in Q4 2023.

Anand Srivatsa

CEO

 

Webcast
A conference call and online presentation will be held in English today at 9:00 a.m. (CET). The webcast link and presentation material will be available in the calendar entry on Tobii´s website ahead of the webcast. The year-end report and a recording of the webcast will be available on the same page after the publication and webcast. You can also attend the webcast through the following link.

This information is information that Tobii AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out below, on February 7, 2023 at 7:30 a.m. CET.