Sinch AB (publ)

Organic revenue growth was 6% in Q2, up from the prior quarter. Organic gross profit growth was 2%, and Americas gross profit grew 10%; EMEA organic gross profit fell 4% and APAC fell 18%. Gross margin was down 1.6 percentage points year over year and slightly down sequentially. Adjusted OpEx increased 1%, adjusted EBITDA grew 4%, and EBITDA grew 7%. Free cash flow was SEK 751 million, rolling 12-month cash conversion was 61%, and net leverage was 1.9 versus 2.0 in the prior quarter. For guidance, management reiterated that second-half 2026 organic revenue and organic gross profit should be stronger than first half 2026, and that adjusted EBITDA margin should remain within the 12% to 14% target range.

Jonas Dahlberg framed the quarter as stable and largely in line with expectations, with strength in the company’s most important region and product category. He highlighted Americas as the core growth engine, API as the key growth vector, and e-mail as a major and profitable business that is growing at a double-digit rate. He also stressed that Sinch is seeing stronger cross-sales, winning more AI-native customers, and developing new solutions such as conversational commerce that could expand growth over time.

Sofia Ohlander said the 6% organic revenue growth was driven by Americas and API, with Americas benefiting partly from pass-through of higher U.S. supplier costs, which added about 2 percentage points to revenue growth. She said gross margin was pressured by about 1 percentage point from those cost pass-throughs and by about 0.5 percentage points from FX mismatch, while the rest of the margin pressure came from EMEA and APAC dynamics; she called the margin move within normal variation. She also noted adjusted OpEx rose 1%, integration costs were down two-thirds year over year, or SEK 30 million, free cash flow was SEK 751 million, leverage improved to 1.9, and the company repurchased 4 million shares in Q2 after having repurchased 15% of shares since the program began.

Analysts focused on the expected acceleration in gross profit growth, the weakness in EMEA and APAC, e-mail economics, net revenue retention, and the outlook for headcount and OpEx. Management said it still expects the second half of 2026 to be stronger than the first half for both organic revenue and organic GP, but did not give more specific quarterly phasing. On APAC, management said the worst is likely behind the business, India is a small part of group profit, and the SEK 17 million customer dispute adjustment is fully provided for with no expected repeat, while on EMEA they said the legacy verification-product churn will remain a drag for about 12 months before washing out. Management also said cross-sales are gaining traction, AI-native wins are currently more about future growth than current revenue, and M&A remains an option if the right accretive opportunities appear.