Fortnox (FNOX) Q3 2024 earnings summary

Executive summary

• Net sales for Q3 2024 rose 26% year-over-year to SEK 523 million, with EBIT up 25% to SEK 235 million and a margin of 45% (48% excluding non-recurring costs).

• Customer base grew by 13,000 to 585,000, marking the highest Q3 increase to date, and ARPC increased to SEK 293.

• Continued investment in product development, automation, and platform engagement, despite macroeconomic headwinds.

• Offerta Group AB was divested and included in a new joint venture, with Fortnox holding a 49% stake.

• Non-recurring staff costs of SEK 13 million due to executive management changes impacted results.

Financial highlights

• Net sales reached SEK 523 million, up 26% year-over-year; EBIT was SEK 235 million, up 24–25%, with a margin of 45%.

• Profit for the period was SEK 189 million, up 27% year-over-year.

• Free cash flow hit a record high in Q3, reaching SEK 244 million, aided by normalized accounts receivable.

• Rule of Fortnox (growth + margin) was 71%, or 73% excluding non-recurring costs.

• Lending segment saw the highest growth at 43% year-over-year.

Outlook and guidance

• Macroeconomic recession in Sweden continues to weigh on organic growth, with recovery projected to begin in Q4 2024.

• No formal guidance provided, but management expects continued focus on usage and ARPC growth.

• 2025 customer target of 700,000 is challenging, but ARPC is ahead of plan.

• Offerta's ARPC contribution will decrease by about 3 SEK in Q4 and be fully phased out over 12 months.

• Q4 customer count expected to decrease by around 1,000 due to Offerta.