eWork Group (EWRK) Q2 2025 earnings summary

Executive summary

• Q2 2025 saw a 13% year-over-year decline in net sales to SEK 3,601M, mainly due to phasing out unprofitable contracts, fewer consultants, and fewer working days, amid global headwinds and market restraints in the Nordics.

• Gross margin improved to 4.1% from 3.8% year-over-year, driven by value-added services, higher-margin delivery models, and more profitable contracts.

• EBIT decreased 14% year-over-year to SEK 45M, primarily due to lower business volumes.

• Order intake dropped 16% year-over-year to SEK 4,142M, reflecting lower demand and consultancy freezes at major clients.

• Implementation of a new digital platform is nearly complete, enhancing efficiency, scalability, and enabling future AI integration.

Financial highlights

• Q2 net sales were SEK 3,601M, down from SEK 4,151M in Q2 2024; gross profit was SEK 148M, with gross margin up to 4.1% from 3.8% year-over-year.

• EBIT for Q2 was SEK 45M, down from SEK 52M year-over-year; EBIT margin was 30% of gross profit.

• Earnings per share after dilution was SEK 1.92 (Q2 2024: SEK 2.00).

• Cash flow from operating activities in Q2 was SEK 151.9M, up from SEK 36.9M; cash and cash equivalents at period end were SEK 29.5M.

• Equity/assets ratio improved to 6.8% (Q2 2024: 6.0%); quick ratio was 104.2%.

Outlook and guidance

• No clear signs of market recovery; Sweden and Norway remain challenging, while Denmark, Poland, and Finland show growth.

• Focus remains on profitable growth, margin improvement, and not signing low-margin contracts.

• Scalability and efficiency expected to improve with the new digital platform and AI adoption.

• The business is positioned to ramp up quickly if market conditions improve.

• EPS growth target of 30% will be challenging under current market conditions.