Digital Workforce Q2'25 flash comment: Slightly better report than our expectations
| Estimates | Q2'24 | Q2'25 | Q2'25e | Q2'25e | Consensus | Difference (%) | 2025e | |||
| MEUR / EUR | Comparison | Actualized | Inderes | Consensus | Low | High | Act. vs. inderes | Inderes | ||
| Revenue | 7.0 | 7.1 | 7.5 | -5% | 29.3 | |||||
| EBITDA | 0.21 | 0.40 | 0.23 | 71% | 0.4 | |||||
| EBIT | 0.11 | 0.31 | 0.13 | 129% | 0.0 | |||||
| PTP | 0.15 | 0.24 | 0.18 | 27% | 0.1 | |||||
| EPS (reported) | 0.01 | 0.02 | 0.02 | 22% | 0.01 | |||||
| Revenue growth-% | 14.4 % | 1.6 % | 7.4 % | -5.8 pp | 7.4 % | |||||
| EBITDA-% | 3.0 % | 5.7 % | 3.1 % | 2.5 pp | 1.4 % | |||||
| Source: Inderes | ||||||||||
Translation: Original published in Finnish on 7/18/2025 at 8:47 am EEST.
Digital Workforce, the software robotics automation pioneer, published a stronger-than-expected Q2 report this morning. Revenue grew but was slightly below our expectations. The earnings, however, clearly exceeded our estimates, supported by cost savings. The company's order book and sales pipeline appear strong, which supports the continuation of the positive revenue and profitability trend in H2. Thus, achieving the guidance also appears clearly more likely again.
Revenue increased, but slightly missed forecasts in Q2
Digital Workforce’s revenue increased by 2% to 7.1 MEUR in Q2 and was slightly below our expectations. By business lines, the revenue of Continuous Services increased by 3% to 4.5 MEUR (forecast: 5.0 MEUR), while Professional Services decreased by 1% to 2.5 MEUR (forecast: 2.5 MEUR) during Q2. As such, the revenue from more valuable, continuous services fell short of our forecasts but was nevertheless at the level of the previous quarter. The number of employees increased by 8 from the previous quarter to 179. Thus, the company still seems to be slightly changing its investment areas, as the company has reduced its staff in previous quarters.
In terms of sales, the company won several good contracts in Q2. In addition, the company commented that the number of sales projects is clearly higher than last year in healthcare, manufacturing, and the banking and insurance sectors, which is naturally positive and supports growth.
Earnings surprised positively
Digital Workforce's EBITDA was 0.4 MEUR, above our estimate of 0.2 MEUR. The EBITDA margin was 5.7%, a significant improvement from the previous quarter (actual -5%), driven by the efficiency measures implemented in Q1. The company reported that it had continued its strategic investments, particularly in its healthcare business and AI solutions, and we estimate that recruitments have focused on these areas. There were no surprises on other earnings and expense lines.
After a good Q2 result, the company is once again safely on track to meet its guidance
Digital Workforce expects higher revenue and improved adjusted EBITDA year-on-year in 2025. In our view, the guidance should be easily achievable. We forecast the company's revenue to grow by 7% and adjusted EBITDA to increase to 1.5 MEUR, i.e., to be 5% of revenue in 2025 (2024: 1.0 MEUR). After a good Q2 result, the company is once again on track to meet its guidance, if the trend remains the same. According to the company's comments, the good order book and sales pipeline support the improvement in development.