Q1 2026 Tieto Oyj Earnings Call Transcript
Key Points
- Tieto Oyj (FRA:TTEB) delivered strong profitability with a 4-percentage-point improvement in adjusted EBITA year-over-year, reaching 14.7%.
- The company has a solid performance in its software businesses, with underlying growth remaining healthy despite legacy contract runoffs.
- Tieto Oyj's order backlog grew by 8% year-over-year, providing good visibility for future growth.
- The company has successfully implemented a cost efficiency program, achieving EUR 105 million in run rate savings by the end of Q1 2026.
- Tieto Oyj has formed strategic partnerships, such as with Microsoft, to enhance AI capabilities and expand its market presence.
- Revenue declined by 3% in Q1 2026, impacted by legacy contract runoffs and weak market demand in Tech Consulting.
- Tech Consulting's performance was below expectations, with continued weak demand and geopolitical uncertainties affecting growth.
- The company announced additional cost actions, including a reduction of 500 employees, to adjust to the current market environment.
- Tieto Oyj's Banktech and Caretech segments were negatively impacted by legacy contract runoffs, reducing growth by approximately 5-percentage-points.
- The geopolitical situation and market conditions have delayed decisions and impacted customer activity, particularly in the Pulp, Paper, and Fibre segment.
Good morning, and welcome to Tieto's first quarter 2026 earnings webcast. My name is Tommi Jarvenpaa, the Head of Investor Relations at Tieto. In Q1, we delivered strong profitability and solid performance in software businesses. This morning, we will present our financial results for the quarter and provide an update on the progress of the strategy execution. After the presentation, we will open the line for questions.
With me here are our CEO, Endre Rangnes; and CFO, Tomi Hyrylainen. And now I will hand over to Endre. Go ahead.
Thank you, Tommi, and welcome then to Tieto's Q1 2026 presentation. I will say that we have clearly been through an eventful quarter with execution of our four strategic priorities and then also coupled with the market development. And as part of this, we clearly see strong momentum from the rapid adoption of AI across the line. And at Tieto, we regard this as a clear opportunity. AI is an integral part
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