Kontron AG shows margin improvement despite revenue decline

Investing.com -- Kontron AG on Wednesday reported a 7% year-over-year decline in second-quarter 2025 sales, partly due to the phase-out of unprofitable EMS business from Katek and the JUMPtec deconsolidation.

Despite lower revenue, the company’s underlying EBITDA margin improved to 12.6%, representing a 166 basis point increase compared to the same period last year and an 18 basis point improvement over the first quarter of 2025.

The Software & Solutions segment remained Kontron’s strongest performer, with sales reaching €137 million in Q2 2025, up 8% year-over-year, and achieving an EBITDA margin of 33.1%. This segment now contributes 34.7% of total group revenue for the first half of 2025, up from 29.9% in the prior year period.

The Europe segment saw sales decline by 15% to €203 million with an EBITDA margin of 9.6%, while the Global segment reported sales of €56 million, down 5%, but with a strong margin of 31.9%.

Net income for the quarter was €19.5 million, 4% below the prior year and down 3% quarter-over-quarter. Operating cash flow turned positive in the first half of 2025, reaching €16.3 million compared to negative €16.8 million in the prior year.

Following the JUMPtec divestment, which generated non-operational proceeds of approximately €48 million in Q2, Kontron has adjusted its fiscal year 2025 guidance.

The company now expects sales of €1.8 billion, down from the previous €1.9-2.0 billion forecast, and EBITDA of at least €270 million, improved from the previous guidance of over €220 million.

The revised guidance implies a significant acceleration to double-digit growth in the second half of the year, which the company expects to be driven by transportation projects, increased defense spending, and the further ramp-up of wall boxes.

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