Third quarter 2026 compared to 2025, group
- Net sales amounted to SEK 67.3 million (72.7), corresponding to a decrease of 7% (-22).
- Growth adjusted for foreign exchange amounted to -10% (-18).
- Software revenue amounted to SEK 39.7 million (48.5), corresponding to 59% (67) of net sales.
- The order book amounted to SEK 946.6 million (281.5) at the end of the quarter.
- Operating profit (EBIT) amounted to SEK -6.1 million (-11.7), corresponding to an EBIT margin of -9% (-16).
- Net income for the period amounted to SEK -4.3 million (-13.3).
- Earnings per share before dilution amounted to SEK -0.09 (-0.33) and diluted to SEK -0.09 (-0.33).
First nine months 2026 compared to 2025, group
- Net sales amounted to SEK 222.7 million (239.3), corresponding to a decrease of 7% (4).
- Growth adjusted for foreign exchange (FX) amounted to -5% (8).
- Software revenue amounted to SEK 135.6 million (140.9), corresponding to 61% (59) of net sales.
- Operating profit (EBIT) amounted to SEK -13.4 million (-14.7), corresponding to an EBIT margin of -6% (-6).
- Net income for the period amounted to SEK -7.1 million (-31.7).
- Earnings per share before dilution amounted to SEK -0.17 (-0.79) and diluted to SEK -0.17 (-0.79).
A word from the CEO:
The third quarter was weaker than we had expected. Net sales decreased by 7 percent to SEK 67.3 million (72.7) and software revenue amounted to SEK 39.7 million (48.5). At the same time, EBIT improved to SEK -6.1 million (-11.7) on a lower cost base. The transformation we initiated after the third quarter of 2025 has delivered on the cost side. Sales now need to follow, and that is where our focus lies.
The quarter in brief
Net sales were affected by continued delays in closing deals, primarily in North America, and by lower exercise volumes during the summer months, which follows the seasonal pattern we see every year. Software revenue was also affected by the change in how we assess our customer contracts, as described in the first quarter report, whereby a smaller share of the contract value is recognized at initial delivery. This results in lower net sales in 2026 but distributes revenue more evenly over the contract term and more closely in line with cash flow. The recurring base continues to grow, and ARR for software revenue increased by 5 percent to SEK 181.3 million. Expert Services had a strong quarter with growth of 28 percent, while software-related services were unchanged.
Total costs were approximately 17 percent lower than in the same quarter last year, which shows that the savings program is taking effect. EBIT for the first nine months amounted to SEK -13.4 million (-14.7), despite lower net sales. Today we are 165 employees compared with 209 a year ago, while continuing to deliver in programs from Australia to Canada and developing Exonaut at a faster pace than before. I am grateful for, and proud of, what the organization has achieved over the past twelve months.
Business during the quarter
Our pipeline continues to grow, supported by the defense buildup in Europe in particular. At the same time, like many others, we are affected by capacity constraints in procurement and purchasing organizations, which prolongs sales cycles and makes it difficult to predict when deals will close. During the quarter we nevertheless signed a number of important agreements, including an extension of our contract in Canada, where Exonaut now also includes AI-supported functionality, and continued agreements within existing programs in the United Kingdom. Through our local partner, the agreement with the Australian Army Combat Training Centre was extended by three years. In the Nordics we continued to win business in defense and total defense, and within NATO our engagement in exercise planning was expanded. These agreements show that existing customers continue to choose Exonaut and to broaden their use of it. Order intake amounted to SEK 55.5 million and the order backlog to SEK 946.6 million (281.5), carried by the UK contract signed in the second quarter, where the start-up phase is proceeding according to plan.
Development of Exonaut
The transition to a continuous delivery model is proceeding according to plan, and we are able to increase the release cadence without the organization growing at the same rate. This also explains why capitalized development expenditure decreased during the quarter, while the level of ambition in development is unchanged. AI is gradually becoming part of the product itself and demand remains high, although many customers still have limited ability to put the capability to practical use. We have an advantage in that our systems are already deployed in customer environments, and we make new AI capabilities available as customers become ready to adopt them.
Cash flow and financing
Cash flow from operating activities amounted to SEK -9.0 million (9.1). The third quarter is seasonally our weakest baseline quarter for cash flow. There are no major license payments during the period, and the summer months mean lower invoicing from Expert Services in Sweden and from software-related services in defense in EMEA, while costs continue to run. The work to improve cash conversion continues with full focus going forward.
The rights issue, which closed on July 23, was significantly oversubscribed. Subscription interest corresponded to approximately 240 percent of the offering, and the Board of Directors resolved to exercise the over-allotment option. The issue provided approximately SEK 73.6 million before issue costs, partly through set-off of shareholder loans. It has strengthened the balance sheet and given us room for the sales resources we are now building up in Europe. I would like to thank existing and new shareholders for their confidence.
North America
After the second quarter, I wrote that the third quarter would be important for North America. The region has not developed as we expected, and net sales for the first nine months are approximately half of the previous years. What did not materialize was new business in the COTS segment, where we sell directly to various parts of the US armed forces. At the same time, we have established a base of contracted programs in the region that provides revenue and cash flow for the coming twelve months, and that allows the operation there to stand on its own. The US remains a strategically important market for us in the long term, but we must prioritize our resources globally, and I have therefore chosen to concentrate our efforts in the US for now on delivering in the programs we have and on a smaller number of qualified opportunities. The new sales resources made possible by the rights issue are directed primarily toward Europe, where we have a strong base and where growing defense budgets are now being channeled toward our areas.
Focus ahead
Our priorities remain unchanged. We deliver for our customers, and the extensions signed during the quarter show that they continue to choose Exonaut. Profitability improved significantly in the quarter compared with the previous year, although operating profit remains negative and cash flow is not yet where it needs to be. In defense we have an order backlog larger than at any time in our history, while revenue is lagging behind. The cost base has been adjusted, and the work in the coming quarters is about capturing the opportunities we see, increasing sales, and securing improved cash flow.
Jonas Jonsson
CEO
For further information, contact:
4C Group AB (publ)
Jonas Jonsson, CEO
Veronica Wallin, CFO
investor.relations@4cstrategies.com | + 46 (0) 8 522 27 900
Certified Adviser: Tapper Partners AB
About 4C Strategies
4C Strategies is a leading global provider of organisational readiness and training management solutions for customers in the defence, public and corporate sectors. 4C Strategies provides an integrated offering of organisational readiness and training management solutions in mission-critical environments, consisting of its software platform Exonaut as well as expert services and software-related services. Exonaut complies with the strictest demands on security and data integrity and is accredited by NATO. From its offices in the Nordics, the UK the US and Australia, 4C Strategies serves over 150 customers, including some of the world's most high-profile public institutions, global enterprises and several NATO allied armed forces. 4C Strategies was founded in Sweden in 2000, and is headquartered in Stockholm. 4C Strategies is the operational brand within 4C Group AB (publ), which is listed on Nasdaq First North Premier Growth Market under the ticker "4C".
investors.4cstrategies.com
This information is information that 4C Group is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 2026-11-03 07:50 CET.
