Techstep (TECH) Q1 2026 earnings summary

Executive summary

• Completed strategic carve-out and divestment of BCM business in Q1 2026, sharpening focus on core operations and scalable growth, with headcount reduced from 260 to 190.

• Implemented cost reduction and reorganization, including ERP and e-commerce platform rollouts to drive operational efficiency and lower costs.

• Achieved major commercial wins in Spain and Norway, reinforcing repeatability and pipeline conversion.

• Transitioned legacy telecom expense solution to operator-agnostic capabilities, impacting near-term gross profit but positioning for higher quality growth.

• Q1 results impacted by divestment, delayed health sector rollouts, and one-off ERP project costs.

Financial highlights

• Q1 2026 revenues reached NOK 219.4 million, up 4% year-over-year on a pro forma basis, but down 12% including divestment effects.

• Net gross profit margin was 26% (NOK 57.8 million), down 7 percentage points and 18% year-over-year.

• Adjusted annualized recurring revenue was NOK 261 million, up 8% year-over-year on a comparable basis, but down 21% including divestment.

• Adjusted EBITA was NOK -11.5 million, down from NOK 0.97 million in Q1 2025.

• Net loss for the period was NOK 29.1 million, with total amortization of NOK 10 million.

Outlook and guidance

• Expectation of recurring revenue growth in 2026, driven by new device onboarding, partner agreements, and expansion in Spain and other markets.

• Cost initiatives and AI-driven process optimization to support future profitability.

• Anticipate continued operational improvements and positive financial progress over coming quarters, with focus on scaling indirect sales and growing margins.

• Streamlined product portfolio and ongoing investments in software and digital platforms position for future growth.

• Benefits from cost reductions and ERP implementation expected to materialize in coming quarters.