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Kitron ASA (OSE:KIT) presented its second quarter 2025 results on July 11, showing revenue growth of 2.7% year-over-year and an improved outlook for the full year, driven primarily by strong performance in its Defence & Aerospace segment.
Quarterly Performance Highlights
Kitron reported Q2 2025 revenue of €172.2 million, up 2.7% compared to €167.6 million in the same period last year. EBIT remained flat at €15.0 million, with a slight margin compression to 8.7% from 8.9% in Q2 2024. The company’s order backlog grew 12% year-over-year to €509.3 million, providing solid visibility for future quarters.
"Strong Cash Flow in the quarter at €19.3 million and significant contract wins in Defence & Aerospace and Connectivity & Industry sectors highlight our operational momentum," the company stated in its presentation.
As shown in the following financial highlights slide:
Net income for the quarter was €10.0 million, slightly down from €10.4 million in Q2 2024, resulting in earnings per share of €0.050 compared to €0.052 in the same period last year. The company’s financial position improved, with net interest-bearing debt decreasing to €96.0 million from €122.8 million a year ago, and the NIBD/EBITDA ratio improving to 1.4 from 1.6.
Sector Performance Analysis
Kitron’s performance across business sectors showed significant variation, with Defence & Aerospace emerging as the clear growth driver while other segments delivered mixed results.
The Defence & Aerospace sector recorded impressive growth of 25% year-over-year, with Q2 2025 revenue reaching €46.2 million compared to €37.0 million in Q2 2024. This sector’s order backlog increased by 46% year-over-year to €237.1 million, representing nearly half of Kitron’s total backlog.
The following sector trends chart illustrates the performance across all business segments:
In contrast, the Medical (TASE:BLWV) Devices sector faced challenges with a 23% year-over-year decline to €11.9 million, while Electrification saw a 7% decrease to €44.1 million. The Industry sector showed modest growth of 5% to €40.3 million, and Connectivity remained relatively stable with 1% growth to €29.7 million.
The company’s order backlog provides a forward-looking indicator of sector performance:
Strategic Initiatives & Outlook
Kitron highlighted several strategic initiatives aimed at capitalizing on growth opportunities, particularly in the Defence & Aerospace sector. The company noted that "new defense tech is creating substantial new opportunities with rapid scalability in production and supply chain requirements," and mentioned that five Kitron sites are now focused on Defence & Aerospace to quickly scale new opportunities.
The company has secured significant new contracts, including a €11 million order for advanced military communication products for the European market, a €4 million order for electronics modules for airborne radar applications for the US market, and contracts for unmanned aerial systems valued between €4-8 million.
The following slide summarizes these key developments:
Kitron also mentioned ongoing M&A activities, stating that an "M&A project [is] advancing, aligned with long-term growth and capability expansion," though specific details were not disclosed.
Financial Position & Guidance
Kitron’s financial position strengthened during the quarter, with improved cash flow and reduced debt levels. Operating cash flow reached €19.3 million, up from €18.8 million in Q2 2024. The company’s equity ratio improved to 36.3% from 33.9% a year ago.
Working capital management showed improvement, with net working capital decreasing 4% year-over-year to €180.7 million, and the cash conversion cycle improving to 104 days from 112 days in Q2 2024.
The detailed cash flow and working capital position is shown in the following slide:
Based on the strong performance in Defence & Aerospace and improving outlook for other sectors, Kitron raised its full-year guidance. The company now expects 2025 revenue to be between €675 million and €725 million, with EBIT expected to range from €55 million to €65 million.
"Rolling 6-month customer outlook supports stronger outlook in second half of 2025," the company noted, adding that while non-defense sectors are showing strengthening outlook for the second half, potential risks include "trade wars, global economic uncertainties and rapid defense orders [that] could impact demand."
Kitron’s stock closed at €60.75 on July 10, 2025, near its 52-week high of €63.50, suggesting investor confidence in the company’s growth trajectory and strategic positioning in the defense sector.
Full presentation:
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