Hexagon AB (publ)

Hexagon reported net sales of EUR 1.05 billion, with about EUR 40 million added to the top line after roughly EUR 70 million of structural/D&E divestment impact; management said this translated to about 12% organic growth and about 1% FX benefit. Gross margin was around 62%, or 62.3% excluding the sold design and engineering business, and EBITAC margin improved to 24.3% from 21% in the comparison period. Adjusted EPS was about EUR 0.078 per share, versus EUR 0.092 reported, with reported net financial items boosted by a EUR 71.5 million Cadence share gain. Guidance/forward commentary: the company reiterated its midterm targets of 4% to 6% organic growth, 24% to 26% EBITAC margin, and 90% to 100% cash conversion for 2026-2030; the restructuring program should reach full run rate by the end of Q3, Robotics cost in 2026 remains guided to about EUR 50 million, and Waygate is still expected to close in H2 2026, most likely Q4.

Anders Svensson described the quarter as excellent and emphasized that momentum improved through the quarter, with strong demand in aerospace & defense, electronics, and general manufacturing. He highlighted portfolio simplification through the Octave separation, growth investment through Waygate and bolt-on deals, and said the company is entering Q3 with strong order intake and continued favorable end-market trends. On Robotics, he said the business is progressing toward commercialization by year-end and Hexagon remains open to partner arrangements if that is the best way to realize the opportunity.

Enrique Patrickson said the quarter showed both strong growth and strong operational leverage, with EBITAC increasing faster than sales and cash conversion at 149%. He pointed to EUR 14 million of restructuring savings in Q2, a run-rate of EUR 73.5 million versus the EUR 74 million target, and said the program should complete by the end of Q3 ahead of schedule. He also noted operating cash flow before tax of EUR 364 million, leverage down to 0.3x, and explained that the EUR 71.5 million Cadence gain lifted reported financial income, while normalized adjusted EPS was lower at about EUR 0.078.

Analysts focused on how much of the margin strength came from one-offs, the sustainability of MI’s 13% organic growth, the impact of tariffs and Middle East freight costs, and the pace of Robotics commercialization. Management said tariff refunds were EUR 2.4 million year over year but were offset by higher costs tied to Iran-related freight, so the net effect was zero, and emphasized that MI growth looked durable rather than one-off driven. On Robotics, Hexagon said costs will rise as commercialization advances and reiterated it is considering partner structures that could involve less than 100% ownership. On Waygate, management said closing is expected in H2, likely Q4, and that some businesses within Waygate may need turnaround work or eventual ownership changes depending on strategic fit.