Seeing Machines (LSE:SEE) delivered a sharp increase in automotive production volumes during the third quarter of FY2026, with more than 1.28 million vehicles equipped with its driver and occupant monitoring systems. The figure represented growth of 122% quarter on quarter and 259% year on year.
The strong performance lifted the company’s global installed vehicle base above 6.1 million units and pushed third-quarter automotive royalty revenue beyond the total generated during the first half of the fiscal year.
Regulatory changes drive adoption of driver monitoring systems
Management said the acceleration reflects growing industry adoption ahead of Europe’s incoming vehicle safety regulations scheduled for July 2026, which are expected to increase demand for Driver Monitoring Systems (DMS).
The company believes the latest quarter represents a turning point toward more stable and structurally higher production volumes as vehicle manufacturers expand deployment of monitoring technology across European automotive platforms.
Operating leverage and profitability targets come into focus
Seeing Machines said the increase in automotive royalties is improving operational leverage and is expected to support positive adjusted EBITDA performance for both the third quarter and the second half of the fiscal year.
Within the company’s Guardian aftermarket division for commercial fleets, hardware sales remained uneven. However, annual recurring revenue increased 5% quarter on quarter to $14.7 million as a larger proportion of installed units became connected to monitoring services.
Management said the growth in recurring revenue improves visibility and supports the expansion of a higher-margin service business.
Strong growth offset by ongoing profitability and cash flow concerns
Despite rapid revenue growth, the company’s broader outlook remains constrained by weak profitability and continued pressure on cash flow generation.
Technical indicators remain supportive, with the share price trading above major moving averages and the MACD indicator remaining positive. However, overbought RSI readings suggest some potential for near-term volatility.
Valuation metrics also remain limited by the company’s loss-making position and the absence of a dividend yield.
More about Seeing Machines
Seeing Machines Limited is an AIM-listed technology company headquartered in Australia that develops AI-powered operator monitoring and computer vision systems designed to improve transport safety. Its driver and occupant monitoring technologies are used across automotive, commercial fleet, off-road and aviation markets through partnerships spanning Australia, the United States, Europe and Asia.
The company’s systems monitor driver attention and cognitive state in real time using embedded sensors and optics, supporting the growing adoption of Driver Monitoring Systems mandated by safety regulators. Seeing Machines generates revenue through automotive production royalties and its Guardian aftermarket fleet monitoring platform, which includes recurring subscription-based services.
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