Smartcraft (SMCRT) Q3 2025 earnings summary

Executive summary

• Achieved annual recurring revenue (ARR) of NOK 505 million, up 6.4% year-over-year, with 97% of revenue now recurring and strong cash flow.

• Adjusted EBITDA minus CapEx margin rose to 28.2%, up 2.9 percentage points year-over-year, reflecting improved profitability.

• Transitioned to a business area structure to drive focus, execution, and scalable international growth.

• Launched SmartCraft Spark and Flow, with strong early adoption and customer satisfaction.

• Maintained a robust financial position with a net cash positive status and continued investment in innovation.

Financial highlights

• ARR grew 6.4% year-over-year to NOK 505 million, with organic growth at 6% and recurring revenue share at 97%.

• Adjusted EBITDA for Q3 2025 was NOK 49.1 million, with a margin of 35.6%, and adjusted EBITDA-CAPEX margin improved to 28.2%.

• Operating cash flow reached NOK 36 million, up 4.8% year-over-year.

• Churn rate declined to 9.6%, with downgrades also decreasing.

• Gross margin remained above 90%.

Outlook and guidance

• Confident in medium-term target of 15–20% organic revenue growth and margin expansion as market conditions normalize.

• Gradual market improvement expected in Sweden, UK, and Finland, with Norway expected to benefit from interest rate cuts.

• Continued investment in innovation, AI-enabled modules, and sales to drive future growth.

• Well-capitalized and ready to pursue M&A opportunities, with a focus on the UK market.

• Short-term impact anticipated from recent acquisitions.