Teneo AI (TENEO) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue and ARR declined sharply due to the loss of a major customer after a partner dispute, but gross margins remained strong and management is confident in the business and pipeline.

• The company is pursuing strategic options including a sale, licensing, or standalone growth, with a strategic review led by J.P. Morgan and Redeye and strong M&A interest.

• Patent portfolio was revalued at $211M, with active enforcement and licensing initiatives underway and top-tier legal counsel retained on a contingency basis.

• New partnerships and wins include EXL, FGS (major Turkish telco), Sierra.ai, and Medtronic, with renewed customer interest after failed LLM-based solutions.

• New product launches in Agentic AI for airlines, utilities, and appliance brands, and renewed ISO 27001:2022 certification.

Financial highlights

• Net sales for Q1 2026 were SEK 11.3–12.3 million, down 51–55% year-over-year.

• SaaS ARR in constant currency was SEK 27.5 million, a 63% year-over-year decline.

• Gross margin remained strong at 80% in Q1 2026.

• Adjusted EBITDA for Q1 2026 was negative SEK 12.2 million.

• Cash and bank position at March 31, 2026, was SEK 21.7–29 million, including SEK 25 million in new subordinated debt from key shareholders.

Outlook and guidance

• The SEK 20 million ARR target is maintained but delayed to Q1 or Q2 next year, with a long-term goal of >20 MUSD ARR by end of Q3 2026 and EBITA margin >30%.

• Strategic review is progressing, with exit as the primary goal to maximize shareholder value.

• Additional financing and debt refinancing are planned to support the strategic review and standalone growth.

• Pipeline remains robust, with several late-stage deals and a record-high weighted pipeline of EUR 6.9 million.

• Management expects revenue upside from new deals, especially the Turkish telco project, which could generate $1 million per month when fully scaled.