Nagarro (NA9) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue grew 4.8% YoY in Euro terms and 9.4% at constant currency, with strong margin expansion and operational improvements despite subdued demand and FX headwinds.

• Gross margin reached 33.1% in Q3, exceeding guidance and reflecting a focus on margin expansion.

• Adjusted EBITDA margin hit 17.3%, the highest since 2022 and above the high end of guidance.

• Corporate governance enhancements included appointing KPMG as auditor, expanding the board, and appointing a new CFO.

• Disciplined capital allocation included share buybacks, dividend payments, and targeted M&A.

Financial highlights

• Q3 2025 revenue was €254.6 million (+4.8% YoY), with 9.4% growth at constant currency.

• Q3 gross profit was €84.2 million (+10.0% YoY); gross margin was 33.1%.

• Adjusted EBITDA for Q3 was €44.0 million (+27.2% YoY), margin 17.3%.

• Operating cash flow for 9M 2025 increased to €77.1 million from €64.9 million YoY.

• Days sales outstanding improved to 85 days from 88 at year-end 2024.

Outlook and guidance

• Maintains previous 2025 guidance, with revenue and adjusted EBITDA tracking to initial targets when adjusted for FX impacts.

• 2025 revenue guidance is at the lower end of the original range; adjusted EBITDA margin guidance is 13.5-14.5%.

• Medium-term outlook is bullish, driven by AI adoption and digital transformation, with double-digit growth targeted in the coming years.

• Profitability expected to improve further, targeting 18% adjusted EBITDA margin over time.