Original-Research: q.beyond AG (von NuWays AG): BUY

Classification of NuWays AG to q.beyond AG

Company Name:	q.beyond AG
ISIN:	DE000A41YDG0
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 5.9
Target price on sight of:	12 months
Last rating change:
Analyst:	Philipp Sennewald

Q1 confirms MS headwinds; Chg.

Yesterday, QBY reported Q1'26 results that came in below our already cautious estimates. In detail:

Q1 sales declined 7.7% yoy to € 42.8m (eNuW: € 44.3m), which was entirely driven by a stronger-than-expected deterioration in Managed Services, where revenues fell 12.7% to € 27.6m (eNuW: € 29.2m). Even after stripping out the c. € 2.7m impact from the billing model transition in Microsoft-related sales still present in Q1'25, the underlying performance remains a concern, pointing towards volume and pricing pressure. The bright spot of the release was again Consulting, which grew 2.9% to € 15.3m (eNuW: € 15.1m), supported by improved utilization and a continued reduction of free-lancer usage, resulting in a segment gross margin improvement of 3.7pp to 17.2%. Overall gross margin still declined by 1.5pp to 17.8% due to the Managed Services weakness. Another positive item was order intake, which increased 7% yoy to € 31.3m, providing some comfort going forward, though conversion continues to be slow.

Accordingly, also EBITDA marginis under pressure, as EBITDA declined 35.2% yoy to € 1.5m (eNuW: € 1.7m), implying a margin of 3.5%. This reflects both the weaker Managed Services development, continued investments into agentic AI capabilities as well as the ramp-up of the new nearshoring hub in Cluj, Romania (set to open in Q2). FCF arrived at € 1.9 net cash remained solid at € 31.2m (incl. leases).

Despite the soft print, management confirmed the FY26 guidance of € 182-190m sales and € 10-16m EBITDA. However, given the weak Managed Service momentum, we continue to view the lower end of both ranges as realistic (eNuW: € 182m sales & € 10.4m EBITDA).
Strategy 2028 remains intact. Despite the near-term softness, the mid-term investment case remains compelling, in our view. The ongoing shift toward higher-value AI-orchestration services, deepening vertical expertise in logistics and retail and the progressive internationalization via nearshoring hubs underpin the path toward € 250m in sales and a ~10% EBITDA margin by FY28 (M&A implied, not reflected in eNuW).

M&A remains a key near-term catalyst. With net cash of € 31.2m and no financial debt, QBY retains significant firepower for value-accretive acquisitions. Management is actively progressing inorganic opportunities, with healthcare and energy as the key target verticals. We continue to expect at least one deal to be announced in FY26, which is not reflected in our estimates and thus provides certain upside.

At 4.6x FY26e EV/EBITDA, valuation remains undemanding. Upcoming catalysts that are expected to result in a re-rating are a stabilization of Managed Services and tangible M&A progress, both of which we expect to emerge through H2'26.

Reiterate BUY, PT € 5.90 based on DCF.

You can download the research here: qbeyond-ag-2026-05-12-previewreview-en-1a13c
For additional information visit our website: https://www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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