Q2 2025 Sinch AB (publ) Earnings Call Transcript
Key Points
- Sinch AB (STU:1I9A) reported a 6% organic growth in gross profit, reaching SEK2.3 billion, with all regions and product categories contributing positively.
- The company achieved a gross margin expansion to 35% this quarter, reflecting solid execution and focus on higher-value offerings.
- Adjusted EBITDA increased 8% organically to SEK869 million, demonstrating effective efficiency measures and financial resilience.
- Sinch AB (STU:1I9A) activated a share buyback program, indicating confidence in its financial position and commitment to shareholder value.
- The company is pioneering AI integration across its platform, enhancing customer communication and positioning itself as a leader in AI-enabled conversational messaging.
- Organic net sales growth was only 2%, which is below the company's ambition and highlights the need for higher top-line growth.
- The company faced significant foreign exchange impacts, with a translational currency effect negatively affecting reported net sales and gross profit.
- Despite positive organic growth, nominal net sales were down 6% due to currency translation effects.
- The company remains cautious about the macroeconomic environment, which could impact future growth and profitability.
- RCS messaging, while showing volume growth, has not yet contributed materially to financials, indicating a longer timeline for significant impact.
(audio in progress) ahead.
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Thank you very much, operator, and a warm welcome to everyone for this Q2 earnings call. My name is Laurinda Pang, CEO of Sinch. And I'm calling in today from the US, while our CFO, Jonas Dahlberg, is calling in from Stockholm today. Let's turn to slide 2 to look at the highlights from the quarter.
I'm pleased to share that our second-quarter results for 2025 demonstrate our continued resilience and steady progress, even as we continue to navigate an uncertain macroeconomic environment. As we begin, I would call out the large FX swings we experienced in the quarter for net sales, gross profit, and costs due mainly to the weakened US dollar.
As we always do, we will point you to organic changes, which normalize these FX swings and is a consistent representation of the underlying business. Reported net sales was SEK6.6 billion, corresponding to a 2% organic growth rate when adjusting for the effect of foreign exchange movements,
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