Observit (OBSE) Q2 2025 earnings summary

Executive summary

• Net sales for Q2 2025 reached 14.7 MSEK, up 33.6% year-over-year, with strong growth in recurring software revenues and international expansion initiatives.

• EBITDA for the quarter was 2.6 MSEK, EBIT 1.0 MSEK, and EBT 0.9 MSEK, all showing significant improvement from the previous year.

• Major contracts signed for body-worn cameras and new partnerships, including a paneuropean agreement with Ruf Group and large-scale deliveries in Denmark and the Netherlands.

• Recurring software revenues (ARR) increased by 19.2% year-over-year to 21.8 MSEK.

Financial highlights

• Gross profit for Q2 was 7.9 MSEK with a gross margin of 54.0%, up from 52.0% last year.

• Operating expenses (excluding depreciation) were -6.7 MSEK; depreciation and amortization totaled -1.6 MSEK, including -0.9 MSEK goodwill amortization.

• Result per share for the quarter was 0.0016 SEK, compared to -0.0003 SEK last year.

• Cash flow from operations after working capital changes was 1.1 MSEK for Q2.

• Investments, mainly in intangible assets, amounted to 1.3 MSEK during the quarter.

Outlook and guidance

• Several large contracts not yet activated in H1 are expected to drive accelerated recurring revenue growth in H2 2025.

• Launch of AI-based camera services is planned, with anticipated positive impact on customer value and new sales.