Bang & Olufsen (BO) Q2 2025 earnings summary

Executive summary

• Q2 2024/25 performance was in line with plans, with EMEA and Americas showing positive revenue growth, but a 1% group revenue decline due to China.

• Gross margin improved to 53.7% from 53.1% year-over-year, reflecting a stronger product mix and higher margins.

• Demand for new flagship headphones H100 and Beoplay Eleven earphones exceeded expectations.

• Capital raise of DKK 228 million completed to fund strategic growth and mid-term investments.

• FY 2024/25 outlook remains unchanged, with strategic focus on brand, retail, and product investments.

Financial highlights

• Q2 revenue was DKK 698 million, down 1% in local currencies year-over-year; H1 revenue was DKK 1,242 million, down 5.9%.

• Gross margin increased to 53.7%, up 0.6 percentage points year-over-year.

• EBIT margin before special items was 1.7%, down from 3% in Q2 last year, due to higher development costs.

• Free cash flow for Q2 was DKK 30 million, up DKK 6 million year-over-year; H1 free cash flow was DKK -6 million, up from DKK -37 million.

• Available liquidity was DKK 159 million at Q2 end, with capital resources at DKK 319 million.

Outlook and guidance

• Full-year 2024/25 guidance maintained: revenue growth in local currencies of -3% to +3%, EBIT margin before special items of -2% to +1%, and free cash flow between -DKK 100 million and 0.

• CAPEX expected at DKK 250–275 million, with capacity costs to rise by DKK 100 million from prior year.

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

• Guidance assumes stable macroeconomic conditions and no major changes in China distribution.

• Gross margin expected to progress year-over-year, but at a slower rate in Q3 and Q4.