Napatech (NAPA) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue reached $6.3 million, up 25% year-over-year and 31% sequentially, with YTD revenue up 26% year-over-year.

• Gross margin for Q3 2025 was 70%, stable year-over-year and up 3.6 basis points from Q2.

• EBITDA loss narrowed to minus DKK 6.1 million, an improvement of DKK 11.5 million compared to last year.

• Net cash flow for Q3 2025 was neutral, improving by DKK 22.5 million from Q3 2024; cash and cash equivalents at quarter-end were DKK 117.7 million.

• Strategic partnerships, notably with Intel-Altera and d-Matrix, are driving new product launches and expanding market reach.

Financial highlights

• Q3 2025 revenue: $6.3m (DKK 40.1m), up 25% in USD and 18% in DKK year-over-year; YTD revenue: $14.5m (DKK 95.6m), up 26% in USD and 21% in DKK.

• Gross margin for Q3 was 70.5%, up 3.6 basis points from Q2.

• Q3 EBITDA was negative DKK 6.1 million, a significant improvement from the prior year.

• Free cash flow for Q3 was negative DKK 1.7 million, DKK 24.3 million better than last year.

• Ended Q3 with DKK 117.7 million in cash and cash equivalents; net working capital at Q3 end was DKK 91.2 million.

Outlook and guidance

• Q4 expected to continue positive trends, maintaining guided revenue range and stable high gross margins.

• 2025 guidance remains unchanged: revenue DKK 150–190m, gross margin 69–71%, staff and external costs DKK 170–180m, and staff costs capitalized DKK 8–12m.

• Non-NetScout clients expected to deliver 20%-25% growth in Q4; NetScout may be lower.

• 2026 guidance remains at 10,700 units, with several thousand units expected from d-Matrix.

• Optimism for growth driven by expanding design win pipeline and strengthening base business.