Bang & Olufsen (BO) Q2 25/26 earnings summary

Executive summary

• Q2 revenue was DKK 676m, down 3.2% reported and 1.2% in local currencies; like-for-like sell-out grew 7%, including 8% in branded channels.

• Gross margin rose to 57.9% and product gross margin reached a record 54.4%; higher strategic, marketing and centennial costs weighed on earnings.

• FY revenue-growth and free-cash-flow guidance narrowed; late product-launch ramp-ups also weighed on Q2 revenue.

Financial highlights

• Q2 gross profit increased to DKK 391m from DKK 374m; gross margin rose 4.2pp to 57.9%.

• Q2 EBITDA before special items was DKK 26m versus DKK 72m; EBIT before special items was DKK -36m versus DKK 12m. Excluding ~DKK 38m of centennial costs, EBIT margin was ~0%.

• H1 revenue was DKK 1,193m, down 4.0% reported and 2.3% in local currencies; gross margin rose to 58.2% from 54.3%.

• H1 EBIT before special items was DKK -63m versus DKK -5m; net loss was DKK 90m versus DKK 30m.

• Free cash flow was DKK -33m in Q2 versus DKK 30m a year earlier, and DKK -168m in H1 versus DKK -6m.

Outlook and guidance

• FY 2025/26 local-currency revenue-growth guidance narrowed to 1%–5% from 1%–8%; EBIT margin before special items remains forecast at -3% to 1%.

• FY free-cash-flow guidance narrowed to DKK -100m to -50m from DKK -100m to DKK 0m; H1 free cash flow was DKK -168m.

• Assumptions include three or more product innovations, CAPEX of DKK 320m–360m, capacity costs ~DKK 150m above 2024/25 and no significant tariff change from current levels.

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