Translation: Original published in Finnish on 10/29/2026 at 8:00 am EET.

SSH's Q3 results were largely in line with our expectations. While growth was moderate as expected following the September profit warning, the ARR level saw good anticipated growth, driven by the major deal with a bank announced in September. Our forecasts are largely unchanged following the report, and we expect growth to pick up starting as early as Q4. We still consider the valuation of the share (2026e EV/S 4.2x) to be somewhat stretched relative to the growth outlook. We reiterate our EUR 1.90 target price and our Reduce recommendation.

Subscription sales grew faster than we expected

SSH’s revenue in Q3 grew by 5% to 5.7 MEUR, in line with our estimates. Growth was driven by strategically important subscription sales, which grew by 18%, slightly faster than our expectations, to 3.9 MEUR. As expected, PrivX drove growth among products, with its subscription ARR growing by a remarkable 34%. Overall, subscription ARR grew by 24%, and total ARR increased by 14%. This growth was driven in particular by the 3 MEUR three-year deal announced in September, which could only impact Q3 revenue for one month. We consider the development of ARR to be the most promising aspect of the report, as its increase will support growth in the coming quarters. Excluding subscription sales, all other revenue items (licenses, maintenance, and professional services) decreased from the comparison period.

EBITDA decreased to 0.3 MEUR (Q3'25: 0.8 MEUR), still exceeding our forecast of 0.1 MEUR somewhat. Front-loaded cost growth weighed on earnings, and the quarter also included 0.2 MEUR in costs related to management changes.

Guidance and estimates unchanged

SSH reiterated its lowered guidance from September, which states that revenue will grow in 2026, cash flow from operating activities will be positive, and EBITDA will remain negative for the full year, though H2 will be better than H1. This requires an EBITDA of approximately -0.6 to 0.1 MEUR for Q4. In his review, CEO Lars Bell, who started in early October, highlighted a focus on growth predictability, the sharpening of sales processes, as well as the growth opportunity presented by agentic AI. Further, Bell also emphasized cost discipline. Admittedly, after this year's increase in costs, cost growth should level off, and the clear goal is to make SSH a profitable company. The report did not provide significant new information on the Leonardo partnership. The company continues to view the partnership as a very valuable opportunity, but, as we have assessed, it will take some time for this to result in tangible growth. In this regard, investors will therefore still need to be patient. We expect revenue to grow by 6% this year to 23.0 MEUR (we expect growth to accelerate significantly in Q4) and EBITDA to be -0.2 MEUR. Next year, we expect growth to accelerate to 17%, driven by the growing share of the rapidly expanding PrivX, the large bank deal, the gradual realization of the Leonardo sales pipeline, and demand driven by agentic AI. EBITDA is expected to reach 1.6 MEUR.

Valuation continues to price in faster growth

SSH's EV/S multiples for 2026–2027 are 4.2x–3.5x, and earnings-based multiples do not yet provide support for the valuation. Relative to large and profitable cybersecurity peers, the share trades at a discount, but compared to Nordic software companies, the company continues to trade at a substantial premium. Our DCF model, which anticipates substantial and profitable growth, suggests a share value of EUR 1.9, close to the current share price. Although there are positive drivers associated with the growth outlook (accelerated ARR growth, large PrivX deals, demand driven by agentic AI, and Leonardo), their realization into total revenue remains modest when accounting for declining revenue items. At the current valuation, the risk/reward ratio is not yet attractive without concrete evidence of significantly stronger overall growth.