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Introduction & Market Context
Seco SpA (BIT:IOT), a leading global player in edge computing solutions, presented its first quarter 2025 results on May 8, showing signs of recovery after a challenging period. The company’s stock responded positively, rising 4.92% to €1.92 on the day of the presentation, reflecting investor confidence in the company’s growth trajectory and strategic direction.
The Italian technology firm, which positions itself among the top five global players in its sector, highlighted its rebound from industry-wide destocking challenges that affected performance in previous quarters. With a diversified geographical presence and increasing focus on AI-powered solutions, Seco is navigating the evolving technology landscape while maintaining solid financial fundamentals.
Quarterly Performance Highlights
Seco reported first quarter 2025 net sales of €47.2 million, unchanged year-over-year but up 7% quarter-over-quarter, indicating a recovery trend. The company’s Clea software platform contributed €5.9 million, representing 13% of overall revenue. Gross profit margin stood at 53.2%, showing improvement compared to full-year 2024 results, while adjusted EBITDA reached €9.4 million with a 20.0% margin.
As shown in the following financial performance summary:
The company’s adjusted net income was €2.3 million, representing 4.9% of sales, slightly down from 5.1% in the same period last year. Management attributed the year-over-year performance to ongoing market challenges, particularly economic weakness in Germany, while emphasizing the sequential improvement as evidence that the destocking cycle is behind them.
Seco’s revenue is geographically diversified, with EMEA accounting for 74% of sales, the United States for 14%, Asia-Pacific for 7%, and the rest of the world for 5%. This geographical spread helps insulate the company from regional economic fluctuations, including limited exposure to recently announced US tariffs.
The breakdown of the company’s sales by geography and business segment provides further insight:
Detailed Financial Analysis
The company’s adjusted EBITDA of €9.4 million in Q1 2025 represented a slight decrease from €10.4 million in Q1 2024. This change was primarily driven by higher consumption costs (-€1.3 million) and increased payroll costs (-€0.8 million), partially offset by positive adjustments (+€1.3 million).
The following EBITDA bridge illustrates these factors:
Seco maintained a strong financial position with an adjusted net financial position of €50.2 million as of March 31, 2025, compared to €41.3 million at the end of 2024. The company’s leverage ratio (Net Debt Adj. / Adj. EBITDA) stood at 1.8x based on last twelve months figures, indicating a manageable debt level.
The evolution of the company’s financial position is detailed below:
Strategic Initiatives
Seco’s strategic focus continues to revolve around its Clea IoT-AI software suite, which has shown consistent growth since its launch in 2021. The platform now contributes 13% to overall revenue, up from 9% in 2021, with the recurring portion increasing from 31% in Q1 2024 to 38% in Q1 2025.
The company highlighted the growing importance of Clea to its business model:
Seco is positioning itself at the forefront of the AI at the Edge transformation, offering end-to-end solutions that combine hardware, software, and services. This strategy aims to enable faster AI adoption in industrial settings through real-time decision-making capabilities and enhanced user experiences.
The company’s AI transformation strategy is illustrated here:
To monetize these capabilities, Seco has developed a comprehensive strategy that includes edge computing systems, the Clea IoT suite, and strategic partnerships with companies like Exein for cybersecurity and Nayax (TASE:NYAX) for payment and telemetry solutions. The company also indicated that additional value-added services would be announced later in 2025.
The monetization approach is outlined in this visual:
Forward-Looking Statements
Seco’s management expressed cautious optimism about the company’s outlook, citing a rebound in order intake and a record-level project pipeline. Key performance indicators support this positive view, with incoming backlog up 56% year-over-year and the book-to-bill ratio increasing by 59% over the same period.
The company expects quarterly revenues to reach €50 million by summer 2025, indicating continued sequential growth. Management also targets a gross profit margin of 50% for the full year 2025.
This projected growth trajectory is visualized in the following chart:
CEO Massimo Mauri emphasized that the company is "back on track to deliver strong growth in 2025" after navigating what he described as an "unprecedented market environment driven by OEM destocking." The company’s diversified client base across industries including industrial, vending, fitness, and medical sectors provides multiple growth avenues.
With its combination of hardware expertise, software capabilities, and strategic positioning in the growing AI at the Edge market, Seco appears well-positioned to capitalize on the increasing demand for intelligent connected devices across various industries, provided market conditions continue to improve as anticipated.
Full presentation:
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