Net Insight (NETI) Q2 2025 earnings summary

Executive summary

• Q2 revenue rebounded to SEK 143 million, up 24% sequentially, driven by a major US media order and improved regional performance, but net sales declined 19.0% year-over-year to SEK 142.6 million due to currency effects and prior year comparables.

• EBITDA margin dropped to 9.7% from 33.4% year-over-year, impacted by restructuring costs and currency effects.

• Secured one of the largest media deals in company history, a USD 6 million order in the US, and the first time synchronization deal in the media market.

• Cost-saving program initiated, targeting SEK 30 million in annual savings, with full effect expected by Q1 2026 and SEK 10 million in one-off costs in Q2.

• Net loss for Q2 was SEK -10.7 million, with diluted EPS at SEK -0.03.

Financial highlights

• Q2 revenue: SEK 143 million, up 24% sequentially; net sales down 19.0% year-over-year to SEK 142.6 million; adjusted year-over-year growth of 4% excluding a SEK 30 million one-off software deal and FX effects.

• Gross margin for Q2 was 68.8%, slightly below the three-year average, but 54.6% as reported due to FX headwinds and lower margin on the large media deal.

• Adjusted EBITDA for Q2 was SEK 23.9 million (16.7% margin); reported EBITDA SEK 13.8 million (9.7% margin); last 12 months EBITDA SEK 112.9 million (20.6% margin).

• Operating margin for Q2 was 0.2% (SEK 0.3 million); EBIT swung to a loss of SEK -9.7 million, with adjusted EBIT at SEK 2.3 million.

• Net cash at quarter end: SEK 98 million; available liquidity including credit facility: SEK 148 million.

Outlook and guidance

• Expectation of increased operating earnings and EBITDA in the second half of the year, with cost savings from restructuring to be fully realized by Q1 2026.

• Strong activity and demand anticipated in all regions, with particular optimism for APAC and EMEA, but macroeconomic and geopolitical uncertainty may delay orders.

• Time synchronization segment expected to ramp up with new customer deployments starting late 2024 into 2025.

• Planned major FPGA component purchases will impact cash flow in coming quarters.

• Financial targets: average annual organic net sales growth >15% and EBIT margin of 20% by 2027.