Elekta (EKTA) Q2 25/26 earnings summary

Executive summary

• Strong performance in Europe, driven by new product launches and double-digit growth, while a new CEO emphasized execution and commercial turnaround, especially in the U.S.

• A new decentralized operating model was announced, including a 10% workforce reduction (about 450 positions, mainly managerial) and targeted annual cost savings of at least SEK 500 million, with full impact expected by Q1 2026/27.

• Comprehensive order backlog review led to SEK 2.2 billion in cancellations, mainly in Middle East and Africa, with no expected impact on revenue or cash flow.

• Cash flow after continuous investments improved significantly year-over-year, reaching SEK 358 million, supported by better working capital and lower investments.

• Further strategy updates and details to be provided at Capital Markets Day in June.

Financial highlights

• Q2 organic revenue/net sales grew 1% in constant currency, with Europe up 11%, while reported sales declined 6% due to FX; Americas fell 8%, APAC declined 3% with growth in India offset by China.

• Adjusted gross margin improved to 37.9% (up 2.2 ppts year-over-year), and adjusted EBIT margin rose to 10.1% (up 0.3 ppts); adjusted EPS at SEK 0.65.

• Net income for the quarter was SEK 229 million, up 6% year-over-year.

• Cash conversion reached 91%, up from 65% a year ago.

• Net debt reduced by almost SEK 700 million year-over-year, with net debt/EBITDA at 1.22.

Outlook and guidance

• Full-year 2025/26 outlook reiterated: net sales in constant currency expected to grow year-over-year.

• Sales in China expected to recover in H2 2025/26, with continued negative impact from tariffs and FX at current rates.

• Midterm targets include gross margin returning to pre-pandemic levels and EBIT margin reaching 14% or higher; more details to be shared at Capital Markets Day.