Digital Workforce Q3’25 earnings preview: We expect good growth and improved profitability

Translation: Original published in Finnish on 10/14/2025 at 7:28 pm EET.

Digital Workforce, an expert in automation utilizing software robotics, will publish its Q3 business review next week on IT Super Thursday, in the morning, according to our estimate.  We expect revenue development to have remained strong in Q3. We estimate that profitability improved significantly from the comparison period and slightly from the previous quarter due to cost savings. In addition, we will be following the company's comments on customer demand in different geographies with interest.

We estimate that growth continued to be clearly better than the sector in Q3

We expect Digital Workforce's revenue to have grown by 5% to 6.9 MEUR in Q3. Growth is clearly better than the IT services sector (Q2 -4%), but slower than last year and the big picture potential. By business segment, we forecast revenue from "more valuable" continuous services to have grown by 5% to 4.6 MEUR and professional services by 6% to 2.3 MEUR. In terms of sales, the company won several good contracts in Q2. In addition, the company commented that the number of sales projects is clearly higher than the previous year, which is naturally positive and supports growth. Geographically, we will monitor comments on the development of the growth markets, the UK and Ireland. Our understanding is that the company has slightly slowed down growth investments in the US this year due to increased uncertainty.

We expect profitability to have improved relatively clearly year-on-year

We expect EBITDA to have grown significantly to 0.5 MEUR, or 7.0% of revenue, in Q3 (Q3’24 2% and Q2’25 6%). The improvement in profitability is supported by several cost-saving measures. Profitability is still constrained by investments in line with the strategy and low billing rates in expert services. In general, the earnings level and profitability at Digital Workforce are sensitive on a quarterly basis, as the company's size is still small, and thus the start and end of individual larger projects can significantly affect the profitability level of a single quarter. In addition, the timing and scale of investments can vary relatively clearly on a quarterly basis and affect profitability. Thus, profitability can fluctuate relatively clearly within the year. We don't expect any surprises on the other earnings lines. As a result, we expect Q3 EPS to have increased to EUR 0.04 from EUR 0.02 adjusted in the comparison period. The effects of the e18 acquisition will start to show from Q4’25 onwards, including the expected one-off costs of the acquisition.

Market comments are of particular interest

The market situation in the IT services sector remained challenging in Q2, with several companies continuing change negotiations to improve efficiency. However, there were small positive signals from the private sector in Finland, but the public sector remained largely challenging in Finland, with customer prices being a particular challenge. Summer is usually the second key turning point of the year, and the Q2 reports did not yet provide a clear picture of how the IT market continued after this turning point. Thus, with small positive signals and the summer turning point, Q3 is of particular interest in terms of market commentary. However, Digital Workforce's offering differs from that of pure IT service companies in terms of offering and geographies, and thus equally strong conclusions should not be drawn about the IT market. Thus, the company's own comments are of particular interest.

However, economic uncertainty has now decreased slightly in Q3 and early October, following the customs agreement and the preliminary peace in the Middle East. However, it was already clear in advance that tariffs should not have a direct impact on the IT services sector or Digital Workforce's operations. However, indirect effects from tariffs are still likely. However, the scale of indirect effects and the obstacles they create for market recovery are still difficult to assess. Our Q2 summary comment for the IT services sector is available here.

We expect revenue to grow relatively nicely and partly scale to profitability in 2025

Digital Workforce expects higher revenue and improved adjusted EBITDA year-on-year in 2025. We forecast the company's revenue to grow by 8% in 2025, driven by an acquisition (organically 3%). In addition, we estimate adjusted EBIT to grow to 1.5 MEUR, which corresponds to 5% of revenue (2024: 0.8 MEUR).