* Volumes strong, sales up 10% y-o-y
* Adj. EBIT growth of 8% y-o-y, margin of 21%
* DOCS now penetrated >30% of municipalities
Q2'26 details
Generic Sweden reported Q2'26 sales of 48.7m, in line with our expectations (0% vs ABGSCe 48.7m), mostly driven by higher volumes in the SMS business (messaging segment), where we started to see a bottoming out already in Q1. Messaging solutions grew 10.7% y-o-y, and this could potentially be an end to the customer cost cautiousness that has held back the segment. The gross margin came in at 44%, in line with what we thought. Reported EBIT was held back by roughly SEK 1m from the settlement of holiday pay liabilities for older holiday days. Adjusting for this, adj. EBIT was SEK 10.3m, up 8% y-o-y and 10% above our SEK 9.4m.
Thoughts
The DOCS product continues to be a success story, and the penetration rate keeps climbing, with around 31% of Swedish municipalities now having the product. The share of wallet is unknown, but breaking into the public sector often takes time, as municipalities tend to sit on long frameworks. We therefore see this penetration rate as very positive for Generic. Growth in the segment was nevertheless lower this quarter at 11%, partly because much of the focus went to one of Sweden's larger municipalities, which went live later than initially planned.
Valuation
The company is valued at 10-9x adj. EBIT on our unrevised numbers for '26e-'27e, around 55% below its peers. Generic continues to operate with 21 employees (22 in Q2'25), making it one of the highest sales-per-employee companies in the Swedish tech sector.