Napatech (NAPA) Q2 2025 earnings summary

Executive summary

• Achieved significant progress on strategic milestones, strengthening position in the mass market for advanced network interface cards (NICs), with notable improvements in capture business and design win pipeline, especially in AI, cybersecurity, and 5G.

• Q2 2025 revenue reached $4.8 million (DKK 31.6m), up 43% year-over-year, with gross margin at 67% and improved EBITDA and free cash flow compared to Q2 2024.

• H1 2025 revenue increased 26% year-over-year to $8.2 million (DKK 55.4m), with gross margin at 68.4%.

• Successfully completed a NOK 210 million (DKK 130m) private placement to finance growth opportunities from partnerships and design wins.

• Expanded Board of Directors with new members and deepened partnerships with industry leaders, including Intel Altera.

Financial highlights

• Q2 2025 revenue: $4.8 million (DKK 31.6m), up 43% YoY; H1 2025 revenue: $8.2 million (DKK 55.4m), up 26% YoY.

• Q2 gross margin: 67% (up from 65% YoY); H1 gross margin: 68.4%.

• Q2 EBITDA: -DKK 19.6 million (improved by DKK 7.7 million YoY); H1 EBITDA: -DKK 48.7 million (improved YoY).

• Q2 free cash flow: -DKK 21.2 million (improved by DKK 23.4 million YoY); cash and equivalents at Q2 end: DKK 133.4 million.

• Staff and external costs declined 12.9% sequentially in Q2.

Outlook and guidance

• 2025 revenue guidance: DKK 150–190 million; gross margin: 69–71%; staff expenses and other external costs: DKK 170–180 million.

• Q3 2025 revenue expected to exceed both Q2 2025 and Q3 2024.

• On track to meet 2025 guidance, with unit shipments expected to reach or exceed 5,700 cards; 2026 guidance: 9,000–10,000 units.

• OpEx expected to decrease in coming quarters due to cost reduction measures.

• Net working capital and cash flow anticipated to improve further, with most new business from large volume orders and a new pre-order business model.