Techstep (TECH) Q2 2025 earnings summary

Executive summary

• Achieved strong commercial momentum and improved profitability, focusing on scalable mobile tech solutions and managing over 3 million devices in Europe.

• Transitioned business model from transactional sales to recurring, end-to-end services, positioning as a strategic partner for clients.

• Secured new and renewed agreements in Norway, Sweden, and Spain, including a NOK 500 million contract with Oslo Municipality.

• Established strategic partnerships with Telia, Fonua, and others, expanding reach in the Nordics, UK, and Ireland.

• Annualised recurring revenue rose 4% year-over-year to NOK 324 million, led by 6% growth in Own Software.

Financial highlights

• Q2 2025 total revenues were NOK 247.2 million, down 7% year-over-year due to expiration of low-margin public contracts.

• Net gross profit increased 5% year-over-year to NOK 88 million, with margin rising to 36% from 32% last year.

• Adjusted EBITA/EBITDA grew 64% year-over-year to NOK 4.3 million.

• Net loss for the quarter was NOK 15.2 million, mainly due to non-cash amortization charges.

• Cash flow from operations improved by NOK 24 million year-over-year to NOK 54 million.

Outlook and guidance

• Profitability is expected to continue improving in H2 2025 and accelerate into 2026.

• Net gross profit growth guidance for 2025: 12–18% year-over-year; recurring revenue growth: 15–25%.

• Ambition to maintain solid double-digit adjusted EBITDA/EBITA growth through 2026, driven by recurring software and services.

• No material impact from macroeconomic factors or US tariffs expected.