Modelon (MODEL) Q3 2024 earnings summary

Executive summary

• Net revenue for Q3 2024 increased 7% year-over-year to MSEK 20.5, driven by software license sales and new customer wins, especially for Modelon Impact.

• Annual recurring revenue (ARR) grew 20% year-over-year to MSEK 56.4, with Modelon Impact ARR up 53% due to expanded adoption.

• Adjusted EBIT for Q3 was MSEK -12.0, reflecting continued investment in product development and commercial expansion.

• A restructuring program was launched in Q3, targeting annual cost reductions of MSEK 25 from Q1 2025.

Financial highlights

• Q3 net revenue: MSEK 20.5 (up 7% year-over-year); software revenue: MSEK 14.4 (up 16%); service revenue: MSEK 6.1 (down 9%).

• Q3 net income: MSEK -18.8 (vs. -11.6 last year); EPS: SEK -1.11 (vs. -1.05); cash flow from operations: MSEK -17.6.

• YTD net revenue: MSEK 60.8 (up 4%); software revenue: MSEK 42.3 (up 9%); service revenue: MSEK 18.4 (down 5%).

• YTD net income: MSEK -45.4 (vs. -42.2); EPS: SEK -3.49 (vs. -3.83); cash balance: MSEK 73.8 (down 6%).

• Adjusted EBIT margin for Q3: -58.5%; for YTD: -62.3%.

Outlook and guidance

• Efficiency program expected to yield MSEK 25 in annual savings from 2025, aiming to accelerate path to profitability and positive cash flow.

• Management remains optimistic about mid- to long-term profitability, citing strong customer feedback and market opportunities.

• Continued investment in usability and scalability to address competitive market and demanding customer requirements.