SoftwareONE (SWON) Q1 2025 TU earnings summary

Executive summary

• Successfully completed tender offer for Crayon, reaching over 90% ownership, with closing expected in June 2025 and integration planning underway; regulatory approvals pending.

• The combination targets a USD 150 billion market with complementary geographies, customer bases, and offerings, aiming for substantial synergy and value creation.

• Q1 2025 revenue declined 5.7% year-on-year to CHF 232.2 million, but adjusted EBITDA rose 2.3% to CHF 46.0 million, with margin improving to 19.8% due to cost reductions.

• Cost reduction program delivered CHF 88 million in annualized savings, exceeding targets, with restructuring costs of CHF 18–19.3 million in Q1 2025.

• NORAM underperformed due to GTM transformation and macroeconomic uncertainty, while APAC grew strongly and other regions performed in line or better.

Financial highlights

• Q1 2025 revenue: CHF 232.2 million, down 5.7% year-on-year; adjusted EBITDA: CHF 46.0 million, up 2.3%, margin at 19.8% (up 1.4pp year-on-year).

• Marketplace revenue declined 11.3%, services revenue flat overall but up 6% excluding NORAM; APAC grew 15.9%.

• SG&A costs reduced by 10.8% year-on-year; delivery costs down 3.2%.

• Contribution margin for Marketplace at 86.5%, Services at 42.8%; adjusted EBITDA margin improved across business lines.

• LATAM grew 15.9%, DACH down 4.3%, EMEA down 1.1%, NORAM down 31.3%.

Outlook and guidance

• 2025 guidance confirmed: revenue growth of 2–4% in constant currency, adjusted EBITDA margin of 24–26%, and dividend payout ratio of 30–50% of adjusted profit.

• Revenue growth expected to remain negative in Q2 2025 due to Microsoft incentive changes, with strong positive momentum anticipated in H2 2025 as headwinds ease.

• Combined company guidance to be issued post-Crayon transaction completion.

• EA incentive headwinds expected to bottom out by end of 2025, supporting growth in 2026.

• Targeting more than doubling reported EBITDA in 2025 on a standalone basis.