Yubico (YUBICO) Q2 2024 earnings summary

Executive summary

• Order bookings grew 65.5% year-over-year, with net sales up 36.3% to SEK 614.4 million, driven by strong demand across financial, tech, and public sectors and robust EMEA growth.

• Gross margin remained stable at 80.3%, and EBIT margin was 21.3%, with EBIT at SEK 130.8 million.

• Annual recurring revenue (ARR) increased 18.4% year-over-year to SEK 287.6 million, with subscription bookings at 21.1% of total bookings.

• Released new firmware and enterprise features, expanded strategic partnerships, and was recognized by TIME Magazine as one of the 100 Most Influential Companies.

• Expanded customer base, with 28% of Global 2000 and 30% of Fortune 500 companies using products.

Financial highlights

• Q2 net sales: SEK 614.4 million (+36.3% YoY); bookings: SEK 672.6 million (+65.5% YoY); subscription bookings: SEK 142.2 million (21.1% of total).

• Q2 gross profit: SEK 493.4 million (gross margin 80.3%); EBIT: SEK 130.8 million (margin 21.3%).

• Operating cash flow: SEK 119.6 million; cash and cash equivalents at period end: SEK 678.2 million; net cash: SEK 645.7 million.

• ARR at period end: SEK 287.6 million (+18.4% YoY), driven by renewals and new contracts.

• EPS after dilution: SEK 1.17 in Q2, impacted by increased share count post-merger.

Outlook and guidance

• Growth momentum is broad-based across industries and geographies, with EMEA and financial sectors as key drivers.

• Strategic partnerships with major tech firms expected to accelerate adoption of passwordless technologies.

• Management targets 25% average annual net sales growth and 20% EBIT margin over five years, with reinvestment of cash flows for growth.

• No plans for dividends in the near term; focus remains on reinvestment for growth.