Kontron (SANT) H2 2025 earnings summary

Executive summary

• Operating cash flow reached a record EUR 168 million, up 69.4% year-over-year, and EBITDA rose to EUR 237 million, including one-off effects from the COM transaction.

• Revenue for 2025 was EUR 1.607 billion, down 4.6% due to discontinued assets and activities, but organic revenue grew after adjusting for portfolio changes.

• Portfolio streamlining continued, focusing on high-margin software, defense, and transportation, with exits from low-margin EMS/IT/COM businesses.

• Share buyback program of up to EUR 50 million replaces the dividend for 2025, with potential for extension depending on market conditions.

• Record backlog and design wins driven by robust order intake in defense, transportation, and automotive sectors.

Financial highlights

• Gross profit slightly decreased by 2.5% to EUR 676 million, but gross margin improved to 42.1%.

• Adjusted EBITDA (excluding one-offs) was approximately EUR 220 million.

• Net income increased 55% to EUR 141 million; adjusted net profit was around EUR 109 million.

• Equity ratio improved from 35.8% to 41.8%; net debt reduced to EUR 147 million.

• Operating cash flow surged to EUR 168 million; cash on hand was EUR 263.5 million, with EUR 200 million in available credit lines and an expected EUR 126 million cash inflow from the COM business deconsolidation.

Outlook and guidance

• 2026 revenue guidance is EUR 1.74–1.8 billion, with EBITDA expected at EUR 225 million, before solar restructuring effects.

• By 2030, revenue is targeted at EUR 2.6 billion and EBITDA at EUR 420 million, with Software + Solutions to comprise 50% of revenue and 75% of EBITDA.

• Software revenue expected to grow from EUR 140 million in 2025 to EUR 180–200 million in 2026.

• Focus on expanding in transportation, defense, and cybersecurity markets.