Source: Inderes & Bloomberg (7 estimates, Aug 19th)

Verve will publish its Q2 report on Thursday, August 27. We expect top-line growth to bounce solidly from the soft comparison period, which was significantly impacted by the platform outage. At the same time, we expect underlying profitability to remain pressured by planned front-loaded sales force investments. Our main focus of the report will be on the cash flow statement, specifically any progress on expanding the securitization program capacity and early signals of stabilizing customer metrics ahead of an expected H2-weighted operational inflection. We expect the company to reiterate its full-year guidance.

We expect solid organic growth beneath the reported optics

We expect Q2 reported revenue of 158 MEUR (Q2'25: 106 MEUR), representing an 18% like-for-like growth*. On a reported basis, we expect growth to reach 49% year-on-year; however, this is materially inflated by the transition to gross revenue recognition under IFRS 15 that took effect in Q3'25. We estimate organic growth in the low-double digits, with the remainder coming from the inorganic contributions of the Captify and Acardo acquisitions as well as FX effects. We expect FX headwinds to ease materially to ~2pp in Q2, down from 10pp in Q1. The quarter is also set against a fairly easy comparison period, which was characterized by the platform outage that limited Verve's ability to scale existing customers and onboard new ones, among other things. We will keep a close eye on the Net Dollar Expansion Rate (NDER), which dropped to 90% in Q1 (Q4'25: 92%) due to the rolling 12-month calculation capturing the 2025 platform outage. We look for signs of sequential stabilization in NDER as the outage effects begin to phase out of the calculation.

In our assessment, looking at the broader US macroeconomic landscape, conditions deteriorated somewhat through the second quarter, as the ongoing US-Iran conflict and the resulting spike in energy prices pushed inflation higher (although almost entirely energy-driven) and kept consumer sentiment depressed. Unlike in Q1, the resilience of the US economy is now harder to argue, as GDP growth slowed to 1.5% in Q2 from 2.1% in Q1. Furthermore, the labor market - previously the economy's most robust pillar - has begun to show signs of weakness, with job growth decelerating markedly. Despite this, we believe Q2 commentary from the peer group was more sanguine than the macro backdrop would suggest, characterizing the ad market as stable rather than robust. Year-on-year median growth among the open internet peer group we track stood at 11% in Q2, a further slight uptick from 10% in Q1, although we would caution that the stable median conceals a sharply widening dispersion, with peer growth rates ranging from -13% to +53%. Walled Gardens (Google, Meta, and Amazon) meanwhile continued to capture market share, accelerating to 26% year-on-year in Q2 from 24% in Q1. On this basis, we expect Verve's organic growth to be broadly in line with the open internet group, but trail that of Walled Gardens in Q2.

Margins temporarily dampened by front-loaded growth investments

We estimate Q2 adjusted EBITDA of 33 MEUR (Q2'25: 30 MEUR), representing a margin of 21% (Q2'25: 22%, like-for-like). We expect the quarter to include some non-recurring costs (~2-3 MEUR) related to office closures from post-merger footprint rationalization and organizational streamlining measures, resulting in a slightly softer reported EBITDA at 31 MEUR. We also anticipate increased capitalized development costs as well as D&A, similar to the trend observed in Q1, driven by ongoing investments in the unified technology platform, retail media build-out, and AI integration. As such, we expect adjusted EBIT of 22 MEUR (Q2'25: 23 MEUR), corresponding to a margin of 14% (17%). Profitability in the first half of the year is intentionally burdened by the front-loaded 10 MEUR investment in sales force expansion, which management expects will only begin to yield meaningful operating leverage and productivity gains in the second half of the year. We will be on the lookout for any comments indicating that this remains the case.

Guidance reiteration likely, with an H2-weighted path to prove

We expect Verve to reiterate its 2026 guidance of 680-730 MEUR in revenue and 145-175 MEUR in adjusted EBITDA. Our full-year estimates sit comfortably within these ranges at 681 MEUR and 162 MEUR, respectively. The guidance implies a distinctly H2-weighted phasing, which we believe means the pressure to demonstrate an operational inflection, particularly regarding sales productivity, will intensify as we move into the second half of the year.

In our view, the most critical watchpoint in the Q2 report remains the cash flow statement. While Q1 operating cash flow was strong, it was heavily supported by working capital timing and the maximization of the securitization program to its 100 MEUR ceiling. Since the facility was fully drawn, the Q1 working capital release cannot be repeated at the same magnitude, and we expect some working capital build-ups in what is a seasonally weaker quarter for cash flows. Therefore, we are looking for concrete updates on the onboarding of the two new legal entities approved for the securitization program in Q2, clarity on the timing of expected capacity uplift, as well as overall improvements in working capital management. In our view, tangible progress on these parameters will be vital for improving underlying cash conversion, strengthening the balance sheet, and driving the deleveraging path toward the company's long-term targets.

*Assuming the comparison period had also been reported on a gross basis (for the in-app SSP platform).