Today’s FY trading update features a beat on net cash (£8.2m vs our £7.4m estimate), profitability ‘in line’, but revenue weaker than expected (£62.7m, vs £70.6m last year). The revenue miss is attributed to ongoing challenges in the ceramics market. Balancing this, Xaar has a ‘significant number of immediate opportunities’ in the pipeline. Xaar is navigating three transitions: (i) product, which sees it replace printhead revenue; (ii) deploying a lower-cost model (Hubble), similarly progressing well; and (iii) geographic, with increasing revenue from the US and Asia. The key headwinds remain the ceramics market and choppy geo-politics, both making for an uncertain buying environment. Reflecting this, Xaar will issue FY25 guidance at forthcoming results (25 March), but we amend forecasts today. As the first OEM products incorporating Xaar printheads ship, the market will ‘unclog’ and with it Xaar gains greater referenceability, in turn reinvigorating investor confidence. Shares are trading on a pedestrian 0.8x EV/Sales, a sharp discount to wider tech (2.9x), reminding us of the maxim ‘buy when others are fearful’.