Techstep (TECH) Q3 2025 earnings summary

Executive summary

• Achieved all-time high annual recurring revenue of NOK 340 million, up 4% year-over-year, driven by 17% growth in Advisory & Services.

• Net gross profit margin improved to 37%, up 2 percentage points from last year.

• Strategic carve-out of the Optidev/Business Critical Mobility business to Lexit Group/Idnet, representing less than 20% of revenue, to sharpen focus and strengthen financial flexibility.

• Signed major new agreements and partnerships, including Sykehuspartner, Pradeo, Fonua, Telia, and Tellu, expanding reach in Europe and healthcare.

• Commercial momentum remains strong, with expansion into Spain, Ireland, and the U.K.

Financial highlights

• Q3 revenues were NOK 222.4 million, down 6% year-over-year, mainly due to expiration of unprofitable public/device contracts in Norway.

• Net gross profit was NOK 81.4 million, with margin rising to 37%.

• Adjusted EBITA was NOK 11 million (5.0% margin), down from NOK 14 million last year, reflecting increased investments in IT and ERP.

• Net loss for the quarter was NOK 8.5 million, mainly due to NOK 17 million in amortization of intangible assets.

• Cash and cash equivalents at quarter-end were NOK 13 million, with NOK 25 million in undrawn credit facilities.

Outlook and guidance

• Full-year targets will not be reached, but strong commercial pipeline and delayed project rollouts are expected to drive growth in 2026 and beyond.

• Acceleration in partner agreements and exponential growth in software and services anticipated post-carve-out.

• Continued focus on managed mobility services and expansion in both direct and indirect sales channels.