Tieto (TIETO) Investor presentation summary

Strategic positioning and growth priorities

• Holds a leading position in resilient Nordic markets with a focused software mix and high recurring revenue streams.

• Pursues scalable growth through selective European expansion, targeting markets like Spain, Germany, and the UK.

• Strong positioning to benefit from AI transformation, with AI embedded in products and partnerships with Microsoft and Databricks.

• Four strategic priorities: customer centricity, simplified core, selective expansion, and competitive cost base.

• Clear financial targets: >5% CAGR growth, >16% profitability by 2028, and dividend payout of 60–80% of net profit.

Business segments and performance

• Operates through Tech Consulting, Banktech, Caretech, and Indtech, each with distinct market focus and high recurring revenue ratios (55–80%).

• Banktech and Caretech deliver strong profitability and growth, with Banktech recurring revenue at 78% and Caretech at 74%.

• Indtech maintains 80% recurring revenue, focusing on niche software for regulated industries.

• Tech Consulting faces market softness but is optimizing costs and upskilling for AI-driven services.

• Q1 2026: Group revenue €448m, adj. EBITA margin 14.7%, order backlog up 8% YoY.

Financial execution and cost optimization

• Cost optimization program on track, with €105m run-rate savings realized by Q1 2026, targeting €130m by end of 2026.

• Personnel reduced by ~2,100 FTEs YoY, with attrition at 7.6% and salary inflation expected at 3–4% in 2026.

• Operating cash flow strong at €85m in Q1, net debt reduced to €377m, leverage at 1.3x EBITDA.

• Share buyback program of €150m underway, expected to complete by September.