Translation: Original published in Finnish on 07/03/2025 at 07:56 am EEST

Nightingale announced that it estimates it has reached its revenue target but missed its adjusted EBITDA target for the financial year 1 July 2024 to 30 June 2025. Falling short of the earnings target was due to investments in expanding international business. Revenue growth fell somewhat short of our estimates, and profitability even more clearly. In the short term, predicting the materialization of the company's growth remains difficult, and growth is also the key profitability driver. We believe the most important thing in the short term is for the company to foster as many high-potential growth initiatives as possible in this situation, now that the business has gained commercial momentum. Our view of the company remains unchanged for the time being.

Revenue growth is by far the most important value driver of the company

Previously, Nightingale estimated that revenue and adjusted EBITDA will increase from last year. The company now expects revenue to grow 15% at most, which is, however, lower than our forecast of 20% growth. The company commented that global economic uncertainty, particularly in the U.S. market, has created challenges for revenue growth. Revenue will therefore be around 2.7 MEUR in H2, which corresponds to a small increase compared to the previous year.

The company now estimates that the adjusted EBITDA will decrease by a maximum of 15% compared to last year, while our forecast was for an approximately 13% improvement in EBITDA. The H2’25 EBITDA will be significantly lower than our previous forecast (-4.4 MEUR). The cost structure in H2 appears to have been higher than our previous estimates, driven by investment efforts, meaning that a clearer scaling of growth to profitability will still take time to materialize. However, we believe the most crucial thing now is for the company to establish as many high-potential growth initiatives as possible, especially as the business has gained commercial momentum. The fruits of these growth seeds will be harvested in the coming years, and we expect strong growth from the company in the future, although this still involves significant risks. Revenue growth is also by far the company’s most important profitability driver.