Company insights: Sonova

One of the more predictable themes over the coming decades is demographic change. Particularly in developed markets, the average age of the global population is increasing.

This will have a wide-ranging impact, but from an investment perspective, one of the areas we think it will be most evident in is the hearing aid industry.

One in four people over the age of 65 suffer from some form of hearing loss, and with an ageing population the World Health Organisation forecasts that by 700m people will suffer from hearing loss by 2050 – which is nearly double the current figure.

Sonova is a Swiss company that has been held in client portfolios since 2005. It’s a long-standing market leader in hearing aids, and a major reason for that is its ability to harness the latest technologies to remain at the cutting edge of its industry.

Its latest product, launched last year, uses a proprietary chip that makes over 7 billion calculations per second to process speech in real time using AI.

Smaller and more powerful chips are enabling more subtle product designs, which is helping to tackle stigma, and they are also making Sonova’s products more effective.

The Spheric Speech Clarity technology in the company’s new hearing aid means a wearer can better understand speech and as well as join in with conversations they struggled to have before.

The company’s commitment to technological innovation is reflected in it consistently investing close to 10% of annual sales in research and development, and we think it's a prime example of how advances in semiconductor technology are enabling breakthroughs in areas beyond generative AI and smartphones.

When you combine those qualities with the structural trends supporting the growth of the industry, we think Sonova is an attractive investment for clients.