Qbeyond: Q1 confirms MS headwinds; Chg. - NuWays AG Research

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

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.

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.

Länk till analysen i sin helhet: https://www.nuways-ag.com/research/q1-confirms-ms-headwinds-chg