Confirmation that Seeing Machines is partnering with Tier 1 suppliers to scale deployment of its driver-monitoring technology into trucks emerged from an interview with CEO Paul McGlone this week.

The latest Guardian Gen 3 sales figures contained in the Q3 KPIs were disappointing at first glance. Although annual recurring revenues and margins increased, only 1,610 hardware units were sold between January and March. The long-discussed target of 6,000 Guardian sales has yet to be reached, although comments made in the same interview suggest Q4 figures could improve materially.

More significant, however, was the indication that Seeing Machines will increasingly license its technology through Tier 1 suppliers selling into the truck market. This represents a major opportunity. Approximately 600,000 medium and heavy trucks are manufactured in Europe annually, and regulatory demand for driver monitoring is increasing rapidly.

With partners including Valeo, Magna International and Mitsubishi Electric, Seeing Machines appears increasingly well positioned to replicate in commercial vehicles the progress it has already made in passenger cars.

The company may have to sacrifice some recurring monitoring revenues where its software is bundled within a Tier 1 ADAS stack. However, the potential increase in deployment volumes could more than offset that trade-off.

Evidence that this strategy is gaining traction may already exist. Valeo recently announced that its Smart Safety 360 ADAS platform — which incorporates driver monitoring functionality — had been selected for deployment with an Indian truck OEM. This raises the obvious question of whether further announcements involving Seeing Machines are now approaching.

I remain confident that progress is being made in both Europe and the US, and expect additional commercial updates over coming weeks and months.

I am also watching closely for news relating to the large Japanese contract recently referenced on LinkedIn, although the identity of the customer has not been officially confirmed.

Further contract wins should strengthen the case for broker upgrades to valuation targets.

In addition, sentiment should continue to improve as investors become increasingly confident that Seeing Machines is:

• Cash generative
• Able to repay the Magna facility through its new debt arrangements, which are expected to be finalised in June.

The recent $3.8m follow-up order from Waymo for BdMS hardware also underlines the strength of the company’s technology and its standing within advanced autonomy programmes.

The writer holds stock in Seeing Machines.