NFON AG's Revised Sales Growth and Earnings Outlook

NFON AG's recent H1 report shows mixed results as sales growth trailed expectations, yet profitability exceeded forecasts. Despite the macroeconomic challenges, the company adjusted its guidance, forecasting a reduced sales growth of 3-5% and an adjusted EBITDA between €12.5m and €14.0m for FY25. This is a decrease from previous estimations.

Q2 sales rose by 3.9% year-over-year to €22.1m, led by subsidiary botario, while the core cloud PBX business contracted slightly. Nonetheless, NFON achieved an adjusted EBITDA of €3.1m, thanks to a 1.2 pp improvement in gross margin. The recurring sales ratio remained strong at 92.9%.

Looking forward, NFON is banking on AI-driven innovations to bolster growth beyond FY26. Recent technological advancements provide upselling prospects, potentially leading to ARPU expansion. Despite the guidance cut, the stock remains part of NuWays Alpha List.