Yesterday, QBY presented its "Strategy 2028", marking a pivotal shift in the investment narrative from a pure margin recovery story to a structured growth case. In detail:
For FY28, management targets € 250m in sales and a ~10% EBITDA margin (1.8x implied FY28 EV/EBITDA). The building blocks for these, in our view bullish, targets are a c. 5% organic sales CAGR, AI-driven upside and targeted M&A. This is underpinned by three strategic pillars:
Industry focus driving margins. Going forward, QBY intends to deepen its strongholds in logistics (€ 25m of FY25p sales) and retail (€ 50m), while entering healthcare and energy via M&A. Both new verticals currently feature fragmented IT landscapes and high regulatory complexity, thus posing a fertile ground for sovereign platforms like QBY's. The M&A filter is disciplined, targeting companies with >10% EBITDA margins. While the strategic logic is sound, execution remains unproven . Encouragingly, management reiterated on the call that capital discipline takes precedence over deal velocity, even after having passed on several transactions last year on valuation grounds. A reassuring signal given the € 42m net cash position. Overall, M&A is expected to contribute c. € 20m towards the FY28 revenue target, with at least one deal anticipated in FY26 (eNuW). Note that future inorganic growth is not reflected in our estimates.
Top-line acceleration via AI orchestration. QBY is currently in the midst of transforming into a sovereign AI orchestrator for the German Mittelstand, building and operating industry-specific agents on its BSI-certified German data centre infrastructure. In our view, this is the most value-relevant pillar and it appears more tangible than typical AI strategy slides. The company already has a handful of paying external AI clients, is confident of reaching 20 by YE, and already has >300 agents deployed. The commercial model targets € 100-300k in recurring Managed Service sales per customer, with setup and development fees on top. The sovereign positioning creates a genuine moat against hyperscalers in the Mittelstand. However, the key open question is how quickly the recurring revenue share builds up, as the consulting-heavy early phase will be margin-dilutive before it inflects. Management targets >60 enterprise clients by FY28, translating into c. € 20m in AI revenues. We view this as ambitious and position ourselves more conservatively (eNuW: € 10m), preferring to see further tangible progress first.
Internationalisation. Nearshore hubs in Spain and Latvia are aimed to be converted into active sales hubs, targeting 10% international revenue share by FY28 vs. 3% today. This would pose a significant diversification away from the stagnating German market, though the financial impact remains comparably modest relative to the other two pillars.
Besides that, management targets FY26 sales of € 182-190m and € 10-16m, implying further margin expansion progress at mid-point. CEO Rixen confirmed on the call that the lower end represents a pure macro stress scenario and not a strategic investment drag, leaving the underlying margin trajectory intact.
That said, valuation remains highly undemanding, as shares are trading at only 3.0x FY26e EV/EBITDA. BUY, new PT of € 6.50 (post capital reduction) based on DCF.
ISIN: DE000A41YDG0