F-Secure (FSC1V) Investor Day 2024 summary

Strategy and Market Positioning

• Focus on unlocking growth through expansion into Tier 1 partnerships, new verticals, and global markets, especially North America and Asia.

• Major strategic shift post-Lookout Life acquisition, emphasizing a partner-first, B2B2C model and embedded security solutions.

• Security is becoming a core service for CSPs, driven by commoditization of telco services and high consumer demand for value-added, high-margin offerings.

• Consumer cyber security market expected to grow 6–7% annually through 2027, with B2B2C channels growing over 3x faster than direct B2C.

• Company restructuring aims to drive growth across all partner segments, from Tier 1s to smaller commercial partners.

Product and Technology Development

• Significant R&D shift from point solutions to holistic, multi-module offerings, with 75% of 2024 investments focused on scam, embedded, and multi-module security.

• Launched new scam protection module and expanded shopping protection to mobile, preventing millions of risky site visits.

• Embedded security portfolio is the broadest in the industry, with SDKs for device, identity, scam, and home security, supporting rapid partner integration.

• "Total" one-app solution offers comprehensive, contextual protection across devices, networks, and platforms, with a unique trusted companion model.

• Industry-leading innovation in scam protection, leveraging AI and proprietary threat intelligence to address the $1 trillion global scam pandemic.

Financial Guidance and Outlook

• Updated medium-term targets: high single-digit CAGR growth, adjusted EBITDA/EBITA margin approaching 40% as revenue nears €200M, with significant upside from large Tier 1 contracts.

• Dividend policy at or above 50% of net profit, subject to leverage remaining below 2.5x.

• 2025 is a ramp-up year, with acceleration toward targets expected thereafter; previous profitability target was above 42% EBITA margin.

• Substantial value potential in converting partners to the "Total" solution, aiming to increase ARPU by 1.2x–2x and grow Total-ready partners from 18% in 2023 to 78% by 2027.

• Continued investment in R&D and restructuring to support growth, with CapEx expected to moderate as platform matures.