ams Osram (AMS) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenues reached EUR 820 million, above the midpoint of guidance, with a 7% sequential and 3–4% year-over-year decline due to seasonality, cyclical weakness, and inventory corrections, but supported by cost savings and non-refundable engineering payments.

• Adjusted EBITDA margin improved to 16.4%, up nearly 2 percentage points year-over-year, with adjusted EBITDA up 9% to EUR 135 million, driven by cost savings and engineering payments.

• The 'Re-establish the Base' program delivered EUR 135 million in run-rate savings by end of Q1, ahead of plan, targeting EUR 225 million by end of 2026.

• Book-to-bill ratio improved to above one, indicating strengthening order intake and improved order entry.

• Strong design-win momentum in automotive, medical, and consumer segments, including major wins in forward lighting, intelligent driving systems, and X-ray sensors.

Financial highlights

• Q1 2025 group revenue was above the guided range of EUR 750–850 million.

• Adjusted EBITDA margin was 16.4%, supported by FX and recurring engineering payments.

• Adjusted net result improved year-over-year from -EUR 35 million to -EUR 23 million; IFRS net result improved by EUR 639 million to -EUR 82 million due to last year's one-off write-offs.

• Operating cash flow was EUR 10 million; free cash flow was negative EUR 28 million, but would have been neutral or slightly positive without a bank holiday delay in payments.

• Net debt increased to EUR 1.9 billion (EUR 1,484 million excluding SLB), mainly due to the EUR 447 million convertible note repayment; available liquidity was EUR 1.2 billion.

Outlook and guidance

• Q2 2025 revenue expected at EUR 725–825 million, with adjusted EBITDA margin of 18.5% ±1.5%.

• FY25 free cash flow expected to exceed EUR 100 million, supported by government subsidies, improved business performance, and CAPEX below 8% of sales.

• Low double-digit revenue increase expected in H2 versus H1, driven by product ramps, design wins, and market normalization.

• Ongoing mitigation of tariff impacts through customer renegotiations and production rerouting, but end demand impact remains uncertain.