Seeing Machines Ltd (AIM:SEE, OTC:SEEMF), the driver monitoring technology group, reported an encouraging pick-up in production volumes for the third quarter of its financial year, following a broader slowdown across the automotive sector.
The AIM-listed company, which supplies driver monitoring systems (DMS) to global carmakers, produced over 358,000 units in the three months to the end of March 2025, a 34% increase on the previous quarter.
The company said the improvement followed an “unexpected dip” in the second quarter that reflected wider softness in global car production.
The recovery comes as European manufacturers ramp up efforts to comply with new safety rules coming into force from mid-2026.
The European Union’s General Safety Regulation will require all new vehicles, including cars, vans, trucks and buses, to be fitted with systems that can detect when a driver is distracted. This regulation is expected to drive demand for Seeing Machines’ technology over the coming quarters.
There are now more than 3.24 million vehicles on the road using the group’s DMS software, up 77% compared with a year ago.
Automotive production volumes for the financial year to date have reached just over 1 million units, marking a 39% increase on the same period last year.
The company also received an early royalty payment in the quarter tied to guaranteed volumes for several automotive programmes. However, the units linked to this payment will only be counted once the related vehicles go into production.
In the commercial transport sector, Seeing Machines began production of its next-generation Guardian safety system, which is designed for trucks and logistics fleets. Production started at the end of March, with output expected to scale to 6,000 units per quarter by the end of June.
Guardian hardware sales in the quarter came in at just over 1,100 units. While modest, this reflects the transitional phase to the newer Generation 3 platform. Recurring revenue from subscriptions, excluding legacy contracts with Caterpillar, held steady at $13.4 million.
In February, the company also signed a referral agreement with Mitsubishi Electric Automotive America to help sell the Guardian system in the Americas. A joint sales plan has since been launched across North America, following a joint presence at a key US trucking industry conference in March.
Seeing Machines said it remained confident in its long-term growth path, with the rollout of regulatory-driven safety technologies expected to support both production volumes and high-margin royalty income through to 2026.
CEO Paul McGlone said: "It is encouraging to see our automotive production volumes increase again in Q3 and I am confident that this momentum will continue as additional new programs start production this year and we move closer to the EU's General Safety Regulation requirement for Advanced Driver Distraction Warning, with significant uptick expected as we move through [financial year] 2026."