Freja eID Group (FREJA) Q2 2024 earnings summary

Executive summary

• Net sales grew 12% year-over-year in Q2 2024 to 10.0 MSEK, with strong growth in Freja eID segment and a decline in Fulfilment segment.

• Adjusted EBITDA turned positive at 0.1 MSEK in Q2, driven by cost control and recurring revenue growth.

• Freja eID segment achieved positive adjusted EBITDA for the first time, reflecting high-margin subscription growth.

• User base reached 1,112,000, up 24% year-over-year, and ARR increased 54% to 24.1 MSEK.

• Company is expanding internationally and benefiting from regulatory changes favoring private eID providers.

Financial highlights

• Q2 net sales: 10.0 (9.0) MSEK, up 12% year-over-year; H1 net sales: 20.3 (17.5) MSEK, up 16%.

• Adjusted EBITDA: 0.1 (-2.9) MSEK in Q2; 0.4 (-6.2) MSEK in H1.

• Adjusted EBIT: -3.7 (-6.7) MSEK in Q2; -7.2 (-13.7) MSEK in H1.

• Net result: -7.4 (-7.8) MSEK in Q2; -15.7 (-15.3) MSEK in H1.

• Operating cash flow: 0.3 (-3.4) MSEK in Q2; 0.7 (-0.4) MSEK in H1.

Outlook and guidance

• Management expects continued strong growth, especially in Freja eID, supported by regulatory tailwinds and international expansion.

• High gross margin and recurring revenue model position the company for improved profitability as scale increases.