Seco (IOT) Q3 2025 earnings summary

Executive summary

• Net sales for the first nine months of 2025 reached €146.4M, up 5% year-over-year, driven by strong order recovery and growth in the US and APAC, offsetting EMEA weakness.

• Gross margin improved to 53.8% (or €78.8M), exceeding guidance, supported by favorable sales mix, increased software revenue, and cost savings.

• Adjusted EBITDA rose 50.8% to €30.8M (21% margin), with Q3 2025 margin at 22.2%, the highest in over two years.

• Adjusted net income surged to €11.4M, up €9.8M year-over-year, while net profit reached €4.6M, reversing a prior loss.

• Clea software contributed €16.6M–€17M (11% of net sales), with 38% from recurring revenues.

Financial highlights

• Edge computing revenue grew 6% year-over-year to €129.9M.

• EBITDA more than doubled to €25.4M (+104.4%), with adjusted EBITDA up 50.8% to €30.8M.

• Net financial position was €51.2M as of September 30, 2025, with net financial debt increasing due to investments.

• Cash and cash equivalents decreased to €59.3M from €72.6M at year-end 2024.

• Book-to-bill ratio consistently at or above 1, indicating strong demand and backlog recovery.

Outlook and guidance

• Full-year 2025 guidance confirmed: revenues expected above €200M at constant FX, with gross profit margin above 50%.

• Q4 revenue expected well above €50M, supported by strong order intake and backlog up 10% year-over-year.

• Profitability improvements expected to continue, driven by business model changes and increased software revenue.

• New Arezzo plant to be fully operational by May 2026, expected to drive further cost efficiencies and increase capacity by 50%.

• Continued focus on profitable growth, net working capital management, and investment in production capacity.