Sleep Cycle (SLEEP) Q1 2026 earnings summary

Executive summary

• Q1 2026 was a deliberate transition quarter with net sales of SEK 52.6 million, down 19% year-over-year (12.2% FX-adjusted), reflecting planned investments in platform expansion and strategic shifts.

• The business is evolving from a consumer app to a multi-pillar sleep tech platform, expanding into sleep apnea solutions and tech licensing.

• B2B revenue grew 42% year-over-year, now representing 14.5% of total revenue, up from 2% in 2023.

• The addressable market expanded from SEK 1.7 billion to SEK 47 billion, driven by sleep apnea and tech licensing opportunities.

• The company leverages a strong data moat with 2.5 million active users and over 4 billion nights of sleep data, supporting scalability and efficiency.

Financial highlights

• Q1 net sales were SEK 52.6 million, down 19% year-over-year (12.2% FX-adjusted).

• EBITDA was SEK 8.2 million (15.6% margin); EBIT was SEK 6.7 million (12.8% margin).

• B2B revenue reached SEK 7.6 million, up 42% year-over-year, now nearly 15% of total revenue.

• Paying subscribers totaled 715,000, down 21% year-over-year; ARPU FX-adjusted was SEK 277, up SEK 7 year-over-year.

• Liquidity at period end was SEK 115–150 million; operating cash flow positive at SEK 7.2 million.

Outlook and guidance

• 2026 is a transition year with elevated investments; guided full-year EBIT margin is 5%.

• Medium-term targets remain: double revenues, 25%+ EBIT margin through the cycle, and 40–60% profit after tax distributed as dividends.

• Growth and profitability expected to resume from 2027 as new revenue streams mature and B2B mix increases.

• Clinical validation for sleep apnea tool expected to complete in September 2026, with US launch targeted for H1 2027.