INTERSHOP Communications (ISHA) Q3 2024 earnings summary

Executive summary

• Achieved positive EBIT of EUR 0.6 million for the first nine months of 2024, reversing a loss from the prior year.

• Cloud revenue grew 30% year-over-year to EUR 15.3 million, now 51% of total revenue.

• Service revenue declined 32% due to complex, cost-intensive projects.

• Net new ARR increased 44% to EUR 1.8 million; license revenues doubled to EUR 2.1 million.

• Cautiously optimistic outlook, with continued investment reluctance in the market.

Financial highlights

• Total revenue rose 4% year-over-year to EUR 29.7 million for the nine-month period.

• EBIT improved to EUR 0.6 million from EUR -1.5 million; EBITDA rose to EUR 3.0 million from EUR 1.1 million.

• Gross profit increased 14% to EUR 13.9 million; gross margin up to 47% from 42%.

• Earnings per share improved to EUR 0.02 from EUR -0.13.

• Cash and cash equivalents declined to EUR 6.4 million from EUR 10.0 million at year-end.

Outlook and guidance

• Board expects a slight increase in incoming cloud orders and net new ARR for full-year 2024.

• Forecasts moderate revenue growth and a balanced operating result (EBIT) for the year.

• Service business challenges may persist due to ongoing complex projects.

• Well-filled new customer pipeline and further cost reduction measures planned.