Bang & Olufsen (BO) Q1 2025 earnings summary

Executive summary

• Q1 2024/25 revenue declined 12–12.4% year-over-year to DKK 544m, attributed to strong prior-year comparables, but gross margin reached a record 55.2%.

• Strategic focus continued on global brand awareness, retail optimization, and product innovation, including the launch of Beoplay H100 headphones and a six-year licensing partnership with TCL.

• Win Cities delivered double-digit sell-out growth; branded channels outperformed multi-brand and e-tail, reflecting ongoing channel optimization.

• New partnerships included brand ambassador Charles Leclerc, collaboration with Riva, and technology licensing with TCL for premium TV audio.

• Approval for a 20% capital increase and a directed share issue by November 2024 to fund mid-term growth plans.

Financial highlights

• Q1 revenue was DKK 544m, down 12–12.4% in local currencies year-over-year; like-for-like sell-out declined 2%.

• Gross margin improved to 55.2%, up from 52.6% last year.

• EBIT margin before special items was -3.1%, mainly due to lower revenue.

• Free cash flow improved to DKK -36m from DKK -61m year-over-year.

• Capital resources totaled DKK 299m, with available liquidity at DKK 139m.

Outlook and guidance

• FY 2024/25 outlook maintained: revenue growth in local currencies expected between -3% and 3%, EBIT margin before special items between -2% and 1%, and free cash flow between DKK -100m and 0.

• Mid-term ambitions: 8% organic CAGR (2025/26–2027/28), 8% EBIT margin before special items, and DKK 250m free cash flow by 2027/28.

• FY 2024/25 CapEx expected at DKK 250–275m; capacity costs to rise by DKK 100m from 2023/24.

• 2024/25 is a transition year with increased capacity costs and CapEx as investments ramp up.

• Guidance assumes four or more product launches and stable macroeconomic conditions.