Modelon (MODEL) Q2 2024 earnings summary

Executive summary

• ARR grew 18% year-over-year to MSEK 53.9, driven by Modelon Impact's 37% ARR growth.

• Net revenue for Q2 was MSEK 21.9, up 4% compared to Q2 2023; software revenue was flat at MSEK 14.4.

• EBIT loss for Q2 was MSEK -12.9, similar to last year, reflecting continued investment in product development and commercial expansion.

• New CEO Jan Häglund started July 1, with a focus on accelerating revenue and profit generation.

Financial highlights

• Q2 net revenue: MSEK 21.9 (up 4% year-over-year); software revenue: MSEK 14.4 (flat); service revenue: MSEK 7.5 (up 11%).

• EBIT for Q2: MSEK -12.9; EBIT margin: -59.0%.

• Net income for Q2: MSEK -12.4; EPS: SEK -1.13.

• Cash flow from operations in Q2: MSEK -14.6; cash balance at period end: MSEK 39.9 (down 56% year-over-year).

• January–June net revenue: MSEK 40.2 (up 3%); EBIT: MSEK -27.4 (improved from -31.1); net income: MSEK -26.6.

Outlook and guidance

• Management expects mid- to long-term opportunities for significant operating profit and cash flows as SaaS investments mature.

• Short-term focus remains on product development and customer acquisition, with higher costs than revenues.

• Company targets ARR growth >35% medium term and EBIT margin >20% long term.