Haftungsausschluss: Der Text wurde mit Hilfe einer KI zusammengefasst und übersetzt. Für Aussagen aus dem Originaltext wird keine Haftung übernommen!

This article first appeared on GuruFocus.

Revenue: EUR794.3 million, an increase of 13% year-over-year. EBITDA: EUR45.8 million, an improvement of 21% year-over-year. EBITDA Margin: Improved to 5.8% from 5.4% in the prior year. Gross Profit: Grew by 12%, slightly below sales growth. Material Costs: Increased by 18%, driven by reliance on third-party suppliers, cloud consumption, and AI usage. Personnel Costs: Increased by 12%, slightly below sales growth. Other Operating Expenses: Grew by only 3%, contributing to EBITDA improvement. Headcount: Total employees reached 11,515 as of June 2026, an increase of 7% (721 employees) year-over-year. Earnings Per Share: Minus EUR0.87 for the first half, impacted by a EUR3.4 million extraordinary write-off at group company Material One. Net Debt: Increased by EUR12 million to EUR1,055 million. Operating Cash Flow: Improved by more than EUR10 million to minus EUR28 million. Free Cash Flow: Improved by EUR12 million. Revenue by Segment (Germany): Germany, contributing 83% of revenues, grew by 12%. Revenue by Segment (Switzerland): Grew by 16%, contributing more than 50% of revenues abroad. Revenue by Industry (Insurance): Sales growth of 22%. Revenue by Industry (Banking): Sales growth of 14%. Revenue by Industry (Public): Sales growth of 10%. Revenue by Industry (Automotive): Declined by 16%. Revenue by Industry (Utilities): Strongest sector with 32% growth. Revenue by Industry (Manufacturing): Double-digit growth of 12%. Revenue by Industry (Retail): Growth of 15%. License Sales (Insure Software): EUR3.3 million, aligned with prior year's EUR3.5 million. Guidance (Revenue): Confirmed target of 9% to 16% growth, translating to EUR1.6 to EUR1.7 billion. Guidance (EBITDA Margin): Target of 8.4% plus, with slight improvements expected.

Warning! GuruFocus has detected 3 Warning Signs with ADSGF. Is ADSGF fairly valued? Test your thesis with our free DCF calculator.

Release Date: August 14, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Adesso SE (ADSGF) achieved a strong 13% revenue growth to EUR794.3 million in H1 2026, despite a challenging German economic environment. EBITDA improved by 21% to EUR45.8 million, driven by strong organic sales growth and a disproportionately lower increase in other operating expenses. Utilization has significantly improved since May, with July recording the strongest utilization since 2024, indicating a positive trend for the second half. The acquisition of Omnius, an AI-driven claims management solution, is expected to enhance Adesso SE (ADSGF)'s insurance portfolio with efficiency gains of 35% and a 4 percentage point improvement in claims ratio. The company confirms its full-year guidance for revenue growth of 9-16% and EBITDA improvement, with a strong order entry and a book-to-bill ratio greater than one. Adesso SE (ADSGF) is successfully decoupling revenue growth from headcount growth, leveraging AI and shoring to improve efficiency and margins.

Story Continues

Negative Points

Q2 EBITDA declined by EUR2 million year-over-year, impacted by a weak April and seasonal vacation effects in Germany. The company recorded an extraordinary write-off of EUR3.4 million related to intangible assets and goodwill at its subsidiary Material One, reflecting a less optimistic business case in the automotive supply chain. Net working capital increased by 22% year-over-year, leading to a negative operating cash flow of EUR28 million in H1 2026. The tax rate for H1 was unusually high at -194%, due to non-deductible write-offs and a higher portion of earnings expected in the second half. The automotive sector experienced a 16% decline in revenue, and the company faces tough competition and price pressure in some areas, limiting daily rate increases. The IT solutions segment, including the new Omnius acquisition, is still loss-making, with a target to reach break-even only by next year.

Q & A Highlights

Q: Can you explain what triggered the reversal in capacity utilization, which started weak and then recovered strongly, and provide transaction details on the Omnius acquisition? A: Michael Knopp (CFO) explained that the slow start was due to contracts and projects taking longer to renew at the beginning of the year. The recovery was driven by increased business activity and a deliberate slowdown in headcount growth. Regarding Omnius, the purchase price and sales figures were not disclosed as it is a startup, but it is expected to have a positive EBITDA contribution next year, with the company leveraging its sales power to convert the existing pipeline.

Q: Why was there no EBITDA increase in Q2 despite continued 12% growth, similar working days, and higher utilization since May? Were there any extraordinary effects? A: Michael Knopp (CFO) stated that the Q2 performance was actually better than budgeted. The company expected a weaker Q2 due to the Easter vacation period in Germany, which impacted utilization. April was a weak month, but this was offset by stronger performance in May and June, resulting in Q2 coming in better than internal expectations.

Q: What is your expectation for the public sector in the coming quarters, given the acceleration in Q2? A: Michael Knopp (CFO) noted that Germany has a huge task in digitalizing the public sector, which should drive demand. However, budget constraints could impact financing. The pipeline for this year looks strong, with a nice order entry expected in the second half, but long-term predictions are difficult.

Q: Can you provide insights into the current license pipeline for the second half of the year? A: Michael Knopp (CFO) explained that the license pipeline involves only a few customers, making it difficult to predict. The pipeline looks okay, but decisions are often delayed by large organizations. The company does not need a very significant number of license sales to meet its guidance, and some projects are promising but may close late in the year.

Q: Is the order book better than when you entered the second half of 2025, and is there a tendency for more short-term orders? A: Michael Knopp (CFO) stated that order entry has seen a significantly better development compared to last year. The backlog includes multi-year orders, such as a major contract covering four to five years, which provides revenue visibility for 2027-2029. Short-term orders are still needed to cover near-term revenue needs, but the overall pipeline looks promising.

Q: Can you give details on productivity gains from AI usage and whether customers are pressuring you to lower prices due to these efficiency gains? A: Michael Knopp (CFO) explained that productivity gains vary by project, with some achieving up to 60% efficiency. Customer reactions vary: some demand lower prices due to reduced time, while others engage in fixed-price projects where AI has improved profitability. The company is seeing a lot of customer activity around AI, with many new projects inspired by its usage.

Q: Can you see clear consequences for future headcount needs, and will the slower growth continue? A: Michael Knopp (CFO) stated that a sharp increase in headcount back to old levels is not expected for the rest of the year. In the mid to long term, revenue growth will be decoupled from headcount growth due to AI and new tools. Headcount will still grow, but at a significantly lower rate than in the past.

Q: Can you explain the drivers behind the increased reconciliation and consolidation in the segment EBIT, and provide color on the AI-influenced order intake and daily rates? A: Michael Knopp (CFO) explained that the IT solutions segment was impacted by the shift of Adesso Mobile Solutions to IT services and the write-off of goodwill and intangible assets at Material One. The AI business is not a separate category, as AI is integrated into normal work, making it difficult to isolate margins. Token consumption is a growing cost, with July exceeding 700,000 and some months expected to pass 1 million. Daily rates are being managed to at least keep pace with inflation, despite tough competition in some areas.

Q: What is your expectation for the result from investments for the rest of the year and 2027? A: Michael Knopp (CFO) stated that the result from investments is expected to stay at the same level for the second half of the year. One of the key contributors is a company in a turnaround situation, and if this turnaround continues, there is a chance the figure will improve in 2027.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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Haftungsausschluss: Der Text wurde mit Hilfe einer KI zusammengefasst und übersetzt. Für Aussagen aus dem Originaltext wird keine Haftung übernommen!

This article first appeared on GuruFocus.

Revenue: EUR794.3 million, an increase of 13% year-over-year. EBITDA: EUR45.8 million, an improvement of 21% year-over-year. EBITDA Margin: Improved to 5.8% from 5.4% in the prior year. Gross Profit: Grew by 12%, slightly below sales growth. Material Costs: Increased by 18%, driven by reliance on third-party suppliers, cloud consumption, and AI usage. Personnel Costs: Increased by 12%, slightly below sales growth. Other Operating Expenses: Grew by only 3%, contributing to EBITDA improvement. Headcount: Total employees reached 11,515 as of June 2026, an increase of 7% (721 employees) year-over-year. Earnings Per Share: Minus EUR0.87 for the first half, impacted by a EUR3.4 million extraordinary write-off at group company Material One. Net Debt: Increased by EUR12 million to EUR1,055 million. Operating Cash Flow: Improved by more than EUR10 million to minus EUR28 million. Free Cash Flow: Improved by EUR12 million. Revenue by Segment (Germany): Germany, contributing 83% of revenues, grew by 12%. Revenue by Segment (Switzerland): Grew by 16%, contributing more than 50% of revenues abroad. Revenue by Industry (Insurance): Sales growth of 22%. Revenue by Industry (Banking): Sales growth of 14%. Revenue by Industry (Public): Sales growth of 10%. Revenue by Industry (Automotive): Declined by 16%. Revenue by Industry (Utilities): Strongest sector with 32% growth. Revenue by Industry (Manufacturing): Double-digit growth of 12%. Revenue by Industry (Retail): Growth of 15%. License Sales (Insure Software): EUR3.3 million, aligned with prior year's EUR3.5 million. Guidance (Revenue): Confirmed target of 9% to 16% growth, translating to EUR1.6 to EUR1.7 billion. Guidance (EBITDA Margin): Target of 8.4% plus, with slight improvements expected.

Warning! GuruFocus has detected 3 Warning Signs with ADSGF. Is ADSGF fairly valued? Test your thesis with our free DCF calculator.

Release Date: August 14, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Adesso SE (ADSGF) achieved a strong 13% revenue growth to EUR794.3 million in H1 2026, despite a challenging German economic environment. EBITDA improved by 21% to EUR45.8 million, driven by strong organic sales growth and a disproportionately lower increase in other operating expenses. Utilization has significantly improved since May, with July recording the strongest utilization since 2024, indicating a positive trend for the second half. The acquisition of Omnius, an AI-driven claims management solution, is expected to enhance Adesso SE (ADSGF)'s insurance portfolio with efficiency gains of 35% and a 4 percentage point improvement in claims ratio. The company confirms its full-year guidance for revenue growth of 9-16% and EBITDA improvement, with a strong order entry and a book-to-bill ratio greater than one. Adesso SE (ADSGF) is successfully decoupling revenue growth from headcount growth, leveraging AI and shoring to improve efficiency and margins.

Story Continues

Negative Points

Q2 EBITDA declined by EUR2 million year-over-year, impacted by a weak April and seasonal vacation effects in Germany. The company recorded an extraordinary write-off of EUR3.4 million related to intangible assets and goodwill at its subsidiary Material One, reflecting a less optimistic business case in the automotive supply chain. Net working capital increased by 22% year-over-year, leading to a negative operating cash flow of EUR28 million in H1 2026. The tax rate for H1 was unusually high at -194%, due to non-deductible write-offs and a higher portion of earnings expected in the second half. The automotive sector experienced a 16% decline in revenue, and the company faces tough competition and price pressure in some areas, limiting daily rate increases. The IT solutions segment, including the new Omnius acquisition, is still loss-making, with a target to reach break-even only by next year.

Q & A Highlights

Q: Can you explain what triggered the reversal in capacity utilization, which started weak and then recovered strongly, and provide transaction details on the Omnius acquisition? A: Michael Knopp (CFO) explained that the slow start was due to contracts and projects taking longer to renew at the beginning of the year. The recovery was driven by increased business activity and a deliberate slowdown in headcount growth. Regarding Omnius, the purchase price and sales figures were not disclosed as it is a startup, but it is expected to have a positive EBITDA contribution next year, with the company leveraging its sales power to convert the existing pipeline.

Q: Why was there no EBITDA increase in Q2 despite continued 12% growth, similar working days, and higher utilization since May? Were there any extraordinary effects? A: Michael Knopp (CFO) stated that the Q2 performance was actually better than budgeted. The company expected a weaker Q2 due to the Easter vacation period in Germany, which impacted utilization. April was a weak month, but this was offset by stronger performance in May and June, resulting in Q2 coming in better than internal expectations.

Q: What is your expectation for the public sector in the coming quarters, given the acceleration in Q2? A: Michael Knopp (CFO) noted that Germany has a huge task in digitalizing the public sector, which should drive demand. However, budget constraints could impact financing. The pipeline for this year looks strong, with a nice order entry expected in the second half, but long-term predictions are difficult.

Q: Can you provide insights into the current license pipeline for the second half of the year? A: Michael Knopp (CFO) explained that the license pipeline involves only a few customers, making it difficult to predict. The pipeline looks okay, but decisions are often delayed by large organizations. The company does not need a very significant number of license sales to meet its guidance, and some projects are promising but may close late in the year.

Q: Is the order book better than when you entered the second half of 2025, and is there a tendency for more short-term orders? A: Michael Knopp (CFO) stated that order entry has seen a significantly better development compared to last year. The backlog includes multi-year orders, such as a major contract covering four to five years, which provides revenue visibility for 2027-2029. Short-term orders are still needed to cover near-term revenue needs, but the overall pipeline looks promising.

Q: Can you give details on productivity gains from AI usage and whether customers are pressuring you to lower prices due to these efficiency gains? A: Michael Knopp (CFO) explained that productivity gains vary by project, with some achieving up to 60% efficiency. Customer reactions vary: some demand lower prices due to reduced time, while others engage in fixed-price projects where AI has improved profitability. The company is seeing a lot of customer activity around AI, with many new projects inspired by its usage.

Q: Can you see clear consequences for future headcount needs, and will the slower growth continue? A: Michael Knopp (CFO) stated that a sharp increase in headcount back to old levels is not expected for the rest of the year. In the mid to long term, revenue growth will be decoupled from headcount growth due to AI and new tools. Headcount will still grow, but at a significantly lower rate than in the past.

Q: Can you explain the drivers behind the increased reconciliation and consolidation in the segment EBIT, and provide color on the AI-influenced order intake and daily rates? A: Michael Knopp (CFO) explained that the IT solutions segment was impacted by the shift of Adesso Mobile Solutions to IT services and the write-off of goodwill and intangible assets at Material One. The AI business is not a separate category, as AI is integrated into normal work, making it difficult to isolate margins. Token consumption is a growing cost, with July exceeding 700,000 and some months expected to pass 1 million. Daily rates are being managed to at least keep pace with inflation, despite tough competition in some areas.

Q: What is your expectation for the result from investments for the rest of the year and 2027? A: Michael Knopp (CFO) stated that the result from investments is expected to stay at the same level for the second half of the year. One of the key contributors is a company in a turnaround situation, and if this turnaround continues, there is a chance the figure will improve in 2027.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

View Comments