Nemetschek (NEM) Q3 2024 earnings summary

Executive summary

• Achieved robust growth and high profitability in Q3 and the first nine months of 2024, with operational development in line with plans despite challenging market conditions, especially in Europe.

• Successfully advanced the transition to a subscription and SaaS-centric business model, with recurring revenues reaching record levels and Bluebeam migration nearly complete by year-end.

• Fully consolidated GoCanvas acquisition from July 1, 2024, contributing to Build segment growth and significantly impacting revenue, cash flow, and balance sheet.

• Net income increased 8.5% to €123.8M; EPS reached €1.07, adjusted EPS €1.26.

Financial highlights

• Q3 2024 revenue increased by 15.1% to €253 million; nine-month revenue up 11.5% to €705 million, with organic growth at 8.9%.

• EBITDA for Q3 grew by 6.7% to €76.2M, margin at 30.1%; nine-month EBITDA up 9.2% to €205.9M, margin at 29.2%.

• Annual Recurring Revenue (ARR) increased 33% to €883.3M; organic ARR growth was 25.2%.

• Subscription and SaaS revenue grew 82.1% to €381M; recurring revenue reached 86% of total.

• Free cash flow before M&A was nearly €200M in the first nine months.

Outlook and guidance

• 2024 guidance confirmed: organic revenue growth of 10–11%, ARR growth expected around 25–30%, recurring revenue share ~85–86%, and EBITDA margin 30–31%.

• GoCanvas consolidation to add ~3 percentage points to revenue growth and dilute EBITDA margin by ~100 bps.

• 2025 guidance remains mid-teens organic growth, with Build segment targeting ~20% growth.

• Guidance assumes no significant deterioration in macroeconomic or sector-specific conditions.