Classification of NuWays AG to NFON AG

Company Name:	NFON AG
ISIN:	DE000A0N4N52
Reason for the research:	Update
Recommendation:	BUY
from:	19.08.2025
Target price:	EUR 12.10
Target price on sight of:	12 months
Last rating change:
Analyst:	Philipp Sennewald

Q2 preview: Expect muted growth as case remains intact; Chg.

Topic: NFON will release its Q2/H1 report this Thursday, which we expect to show a muted top-line growth but also further improved profitability driven by botario’s AI solutions. In detail:

We expect Q2 sales to grow 5.1% yoy to € 22.4m (eCons: € 22.3m), which should be almost entirely driven by botario, as we expect the legacy business to remain roughly flat yoy. The reason for this is seen in the weak macro environment, cautious IT spending, delayed investment decisions as well as prolonged sales cycles. Based on market observations, many clients, especially SMEs and export-driven sectors, continue to prioritize cost control over modernization, limiting upgrades and keeping demand for traditional telephony broadly unchanged. As a result, we also expect a slightly lower recurring revenue ratio of 92.9% (-2.0pp yoy). Blended ARPAgainst this backdrop, Q2 adj. EBITDA is seen to come in at € 2.9m, implying a 12.6% margin (+1.8pp yoy). The improved profitability should as well be a result of botario (eNuW: 30% EBITDA margin). In this context it is important to mention, that personnel-related investment as well as AI initiatives are seen to have weighed on margins also in Q2.

Against this backdrop, we see the top-line guidance of 8-10% growth at risk, given that macro-related headwinds are expected to persist in H2, which is why we now expect sales to grow by only 5.1% to € 91.8m (eCons: € 93.4m). On the other hand, we regard the adj. EBITDA guidance (€ 13.5-15.5m) to remain achievable given the continuously strong botario business (eNuW: € 13.6m; eCons: € 14.1m). We thus think that a guidance cut on the top-line is in the cards for H2 and might come earliest this Thursday.

Action. We slightly adjust our estimates in accordance with the ongoing reservations on the buyer side in the ICT market as well as prolonged sales cycles.

Nevertheless, the overall investment case remains fully intact as we see growth to accelerate from FY26e onwards, driven by AI integration and operational efficiency. In our view, the acquisition of botario (Q3’24) adds advanced AI capabilities that not only diversify revenues but also expand the company’s up- and cross-selling opportunities. At the same time, new features like voicemail transcription, call summarization, and the “Nia” assistant enhance customer value and support higher ARPU, while NFON is continuing to streamline operations in line with its “NFON NEXT 2027” strategy.

We therefore maintain our conviction and keep the stock in our NuWays Alpha List, which is also based on an attractive valuation of 8.3x EV/adj. EBITDA FY25e (5.8x FY26e). Reiterate BUY with a new PT of € 12.10 (old: € 12.30) based on DCF.

You can download the research here: nfon-ag-2025-08-19-update-en-93c61
For additional information visit our website: https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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