Kongsberg Automotive (KOA) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue was €162.9M, down 10.3% year-over-year, mainly due to challenging market conditions and negative currency effects, especially in North America and China.

• EBIT rose sharply to €4.9M (3.0% margin), up from €1.1M (0.6%) in Q3 2024, a 445% increase, driven by cost reductions and lower warranty accruals, despite lower revenues and asset impairments.

• Free cash flow improved to €6.6M from -€5.2M, an €11.8M year-over-year increase, reflecting disciplined cost management and investment controls.

• Cost reduction programs are on track, targeting €40–42M in annual savings and 150 positions reduced, with full impact expected by 2026.

• Warranty liabilities remain a risk, with €2.7M in Q3 expenses and additional risks identified from legacy contracts and past management.

Financial highlights

• Revenue declined 10.3% year-over-year to €162.9M, mainly due to lower demand and a €5.4M negative currency effect.

• EBIT margin improved to 3.0% from 0.6% in Q3 2024, supported by cost reductions and lower warranty costs.

• Free cash flow turned positive at €6.6M, compared to -€5.2M in Q3 2024.

• Equity ratio increased to 31.3%–34.6%; leverage ratio improved to 2.1–2.6.

• Net profit for Q3 was €1.6M, compared to -€8.3M in Q3 2024.

Outlook and guidance

• H2 2025 EBIT margin expected to exceed both H1 2025 and H2 2024, with a stable outlook for the rest of the year.

• 2026 outlook is cautiously optimistic but acknowledges ongoing market uncertainties.

• Cost base will be maintained as low as possible, with further streamlining planned.

• Long-term strategies to be presented at Capital Markets Day in December 2025.