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Third party research

Xplora Technologies: Doro conversion rate now 25% - ABG

Xplora Technologies

This is a third party research report and does not necessarily reflect our views or values

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* Q3: high GM, but soft device sales and ARPU* Doro conversion rate 25% in D2C channels (13% in Q2)* Estimates slightly down, but positive with strong Doro conversion rateAdj. EBITDA NOK 76m, 2% above ABGSCeRevenue was NOK 510m, 4% below ABGSCe of NOK 533m, The gross margin was 51.6% vs. ABGSCe of 47.5%. Opex was NOK 191m, 7% higher than ABGSCe of NOK 178m. There was a NOK 4.6m one-off relating to change of CEO in Doro, adjusted for this opex was 187m. This gave an adj. EBITDA of NOK 76m, 2% above ABGSCe of NOK 75m, corresponding to an EBITDA margin of 14.1% vs. 11.8% in Q3'24. Capex was NOK 13m (ABGSCe NOK 15m), resulting in adj. EBITDA-capex of NOK 64m, 6% above ABGSCe of NOK 60m.Lower device sales and ARPUTotal device revenue was NOK 420m, 3% below ABGSCe of NOK 435m. Kids & Youth device sales of NOK 158m was 10% below ABGSCe, and Senior device sales (Doro) of NOK 263m was 1% above ABGSCe. Service revenue was NOK 90m, 8% below ABGSCe of NOK 98m, corresponding to a growth of 20% y-o-y. Number of Kids subscriptions ended at 443k as pre-announced, of which 291k were Connectivity (ABGSCe 294k), 104k were Premium (ABGSCe 105k), 35k were B2B (ABGSCe 31k), and 12k were Service fee (ABGSCe 12k). This gave a monthly ARPU of NOK 72 vs. ABGSCe of NOK 78, which compares to NOK 83 in Q3'24.Cons to lower estimates, but high Doro conversion rate is positiveXplora now says the subcriber conversion rate for Doro has increased to 25% in Nordic D2C channels. This compares to 13% in Q2. This is very positive as converting Doro phone sales to subscriptions is the most important thing that Xplora needs to deliver on going forward. It also says that it has so far signed 900 retail stores that will sell doro phones with subscriptions with rollout starting in Q1-Q2’26. We expect cons to lower estimates on higher costs and lower revenues.
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