Vertiseit (VERT) Q3 2024 earnings summary

Executive summary

• Annual Recurring Revenue (ARR) reached 187.2 MSEK at Q3 2024, up 21% year-over-year, with organic growth exceeding 20% and surpassing 250 MSEK including Visual Art, ahead of the long-term goal.

• Net revenue declined 15% year-over-year due to lower system sales, aligning with the strategy to expand partner collaborations for hardware sales.

• Adjusted EBITDA for Q3 2024 was 23.2 MSEK (28% margin), marking the most profitable quarter in company history.

• All external financial debt repaid, resulting in a cash-positive position at quarter-end.

• Acquisition of Visual Art post-Q3, adding ~75 MSEK ARR and 348 MSEK in revenue, with 120 employees, strengthening international presence and SaaS focus.

Financial highlights

• Adjusted EBITDA margin reached 28%; cash EBITDA margin at 22%.

• Net revenue retention at 111% annualized, exceeding the 100% financial target.

• Free cash flow for Q3 2024 was 5.7 MSEK; available liquidity at 45.7 MSEK.

• SaaS revenue now exceeds 50% of total revenue, up from 25% at IPO.

• Gross margin Q3 2024: 72.1% (62.6%).

Outlook and guidance

• Confident in sustaining current organic growth, including Visual Art, with stable demand across all platforms.

• ARR is expected to exceed 200 MSEK by the end of 2024, with a long-term goal of surpassing 250 MSEK and 1 billion SEK by 2032.

• Plans to invest further in the U.S. market, leveraging Visual Art's Chicago presence and ongoing partner discussions.