NFON (NFN) Q2 2025 earnings summary

Executive summary

• Revenue grew 3.9% year-over-year to €44.2 million in H1 2025, with recurring revenue up 2.9% and non-recurring revenue up 19.9%.

• Adjusted EBITDA increased 3.4% to €5.7 million, reflecting disciplined expense management and strategic investments.

• Gross margin improved to 86.1%, supported by high-margin recurring revenue and cost optimization.

• The seat base declined 1.1% to 657,584, with stable ARPU at €9.91.

• AI-powered product innovations, a modular licensing model, and the NEXUS partner program were launched to drive growth and partner engagement.

Financial highlights

• Total revenue grew 3.9% year-over-year to €44.2 million in H1 2025.

• Adjusted EBITDA rose 3.4% to €5.7 million; EBIT stable at €1.1 million; net result improved to €0.73 million.

• Recurring revenue made up over 93% of total revenue, while non-recurring revenue surged 19.9%, mainly from botario's project business.

• Gross margin up to 86.1% (from 84.5%); personnel expenses increased to €19.1 million, with one-off effects for management reorganization and system harmonization.

• Operating cash flow was €2.5 million (down from €3.7 million); free cash flow at €0.7 million.

Outlook and guidance

• 2025 revenue growth guidance revised to 3%-5% (from 8%-10%) due to softer core business and extended decision cycles.

• Adjusted EBITDA guidance now €12.5-14 million (previously €13.5-15.5 million).

• Midterm targets for 2026 and 2027 remain unchanged, with optimism for seat growth recovery and product innovation impact.

• Strategic focus on AI-driven innovation, operational efficiency, and channel enablement amid macroeconomic volatility.

• Confidence in H2 2025 based on high recurring revenue share and ongoing strategic initiatives.