Alten (ATE) H2 2025 earnings summary

Executive summary

• Revenue declined by 1.1% year-over-year to €4,099M, with France up 4.3% and international down 3.7%; organic revenue fell 4.5%, mainly due to a sharp drop in Automotive (-16%) and declines in Telecoms, Electronics, and Public Sector.

• Operating profit on activity was €346.5M (8.5% of revenue), above the anticipated 8.1%, but net income dropped 42.6% to €106.9M due to non-recurring items and goodwill impairment.

• Free cash flow was €239.9M (5.9% of revenue), and net cash position improved to €390.2M, with gearing at -17.5%.

• Headcount stood at 51,000 engineers at year-end, down by 900 from the previous year, with a stable 90% engineer ratio.

• AI integration and training prioritized, with over 65% of employees trained and AI tools deployed across 25% of R&D projects, yielding 15% average efficiency gains.

Financial highlights

• Operating profit margin on activity decreased from 9.1% to 8.5% year-over-year; operating profit fell 28% to €199.6M, impacted by €67.4M goodwill impairment and non-recurring costs.

• France revenue grew 4.3% to €1,418.8M, while international revenue declined 3.7% to €2,680.2M.

• Free cash flow generation was strong, supported by improved working capital and low capex (0.2–0.3% of revenue).

• Dividend and shareholder returns totaled €62.2M; dividends paid were €52.2M.

• Working capital requirements improved by €33.5M, aided by better DSO and lower activity.

Outlook and guidance

• Q4 2025 showed sequential stabilization, with Civil Aeronautics and Banking/Finance returning to growth; visibility for 2026 remains low, with more precise guidance after Q1.

• One additional working day in 2026 is expected to improve margins by ~25 basis points.

• Management targets a rapid return to a 10% operational margin as growth resumes, focusing on international expansion and AI-driven productivity.