HMS Networks AB (publ)

Q2 net sales were SEK 991 million, up 12% organically and 18% in total. EBITDA was SEK 266 million, up 59% year over year, with a 26.8% margin; gross margin was 63.8% versus 61.8% last year. EPS was SEK 3.65. Order intake grew 15% organically and 20% in total, while operating cash flow was a record SEK 334 million and year-to-date operating cash flow was SEK 584 million. Net debt was SEK 2.26 billion, with net debt/EBITDA at 1.74x on a pre-IFRS 16 basis. For the second half, management expects slightly lower gross margin than Q2, saying it should stay north of 62% but likely not north of 63%, due to mix normalization and higher semiconductor-related costs.

Staffan Dahlström framed the quarter as a broad-based, high-quality result and said growth came from all major markets. He highlighted three indirect demand pillars tied to data centers: industrial automation customers, system integrators, and semiconductor OEMs, while noting that the momentum in U.S. data-center investment is still strong. He also pointed to new product releases, the Ekkono minority investment, and an EcoVadis gold rating as signs that strategy execution and sustainability work are progressing well.

Joakim Nideborn emphasized that top-line growth is outpacing cost growth, with organic operating costs up 9% while the company continues to invest in R&D and organization. He said gross margin strength was supported by mix and a strong I&T gateway business, but expects some second-half pressure from memory and other component price increases once inventory buffers are used up. He also noted a SEK 6 million positive EBITDA impact from divesting the PEAK-System France sales entity, record operating cash flow of SEK 334 million, a SEK 53 million working-capital benefit, and lower interest costs helped by reduced leverage and a new bank agreement.

Analysts focused on why EBITDA margin remained so strong despite higher investment, and management said it was mainly because revenue is growing faster than costs, not because expense initiatives are lagging. On data centers and semiconductors, management said demand is coming through several indirect channels and appears to be continuing for now, but they do not know the exact size of those verticals because the business is embedded in normal customer demand. On gross margin, CFO said Q2 was lifted by about one percentage point of extraordinary mix and could face roughly another point of semiconductor-related headwind in H2, with a still-expected margin above 62%. Management also said product development is on track, helped by AI tools in coding, and current R&D run rates are expected to remain similar for the rest of 2026.