<p>Here are a couple of mixed nuggets from our first impressions:</p>
<ul>
<li>Zwipe says Pay ONE remains on track, which is imperative.</li>
<li>The wearable project with G&amp;D is also on track. Not much is known about this project, and we think it is possible that the potential could be underestimated.</li>
<li>H1 sales and operating loss of NOK 0.9m and -31.6m came in better than our estimates of 0.4m and -36.9m.</li>
<li>The operating cash flow, adjusted for one-offs like e.g. Idemia payments, was NOK -30m.</li>
<li>Cash was at NOK 43m at the end of June, meaning another financing round in Q4 or Q1&#8217;21, in our view, although it should not come as a surprise</li>
<li> Zwipe wrote that mobile phone manufacturers (Apple, Samsung and Huawei etc.), and other non-traditional card issuers such as Amazon, Uber, Klarna and Google, have all begun to issue payment cards. We think this serves as proof that there will not be a winner-takes-it-all technology, but instead card and mobile will coexist and complement each other.</li>
<li>The report included a lot of market data showing how e.g. the payment ecosystem has increasingly embraced the need for secure, contactless payments. This was also captured by <a href="https://www.redeye.se/research/790773/zwipe-corona-drives-faster-adoption">our recent research piece of August 6</a>, with the self-explanatory title &#8220;Corona Drives Faster Adoption&#8221;, where we increased our valuation.</li>
<li>The ecosystem is coming together. Zwipe has continued to add more partners, whereof two of them as late as last week (Smart Technology Services, and Wisecard). Zwipe stated that the partnerships will simplify the adoption and reduce the total cost of the Zwipe Pay ONE. We will look more into this matter</li>
<li>Zwipe also provided insights from contacts with banks, suggesting that there is a large willingness to pay for biometric cards. These findings are interesting as they verify earlier surveys, although samples are likely relatively small. Perhaps more interesting is that Zwipe, based on these findings, has been able to initiate promising engagements with several banks regarding how to, in a profitable way, roll out biometric payment cards to consumers in a large scale&#8221;. Profitable business models for the banks could speed up the roll-out while banks wait for the card cost to be low enough.</li>
<li>Last, the report also mentions that &#8220;Several of Zwipe’s smart card manufacturing partners have completed thorough testing processes and have begun small scale manufacturing trials&#8221;</li>
</ul>
<p>All in all, the report was highly interesting, and confirming that the market is progressing at a good pace.</p>
