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Introduction & Market Context
Techstep ASA (OB:TECH) presented its Q3 2025 results on November 27, 2025, revealing a mixed financial performance with declining revenue but improved margins. The stock responded positively to the presentation, rising 3.28% to close at NOK 13.00, approaching its 52-week high of NOK 14.95.
The Norwegian-based mobile and circular technology company, which manages over 3 million devices across Europe, is navigating a strategic shift toward higher-margin software and services while divesting certain business segments to sharpen its focus.
Quarterly Performance Highlights
Techstep reported total revenue of NOK 222.4 million for Q3 2025, representing a 6% decline compared to the same period last year. Despite this drop, the company achieved a record net gross profit margin of 37%, up 2 percentage points year-over-year.
As shown in the following profit and loss statement, the revenue decline was primarily driven by a 13% decrease in Mobile Devices & other revenues, while Advisory & Services grew by 13%:
The company’s adjusted EBITA fell to NOK 11.0 million, down 22% from NOK 14.2 million in Q3 2024, resulting in a net loss of NOK 8.5 million for the quarter. Management attributed the EBITA decline to investments in efficiency improvements, including ERP system implementation.
A bright spot in Techstep’s performance was the achievement of all-time high recurring revenue, which increased by 4% year-over-year to NOK 340 million. This growth was primarily driven by a 17% increase in Advisory & Services revenue, as illustrated in the following chart:
Strategic Initiatives
Techstep announced several strategic moves during the presentation, with the most significant being a business carve-out involving its former Optidev acquisition and "business critical mobility" solution area. This segment represents less than 20% of Techstep’s revenue and will be sold to Lexit Group AS, with the transaction expected to complete before Christmas 2025.
CEO Morten Meier explained that this divestment will allow Techstep to "sharpen focus, strengthen its financial position, and enhance operational efficiency" while investing more effectively in its core business.
The company also highlighted several new partnerships that support its European expansion strategy:
1. A strategic partnership with Pradeo, a European leader in mobile security, to deliver EU-compliant solutions combining Techstep’s MDM/UEM with Pradeo’s MTD technology.
2. A partnership with Fonua to enter the Irish and UK markets with Techstep’s Device Lifecycle Management platform.
3. An operational partnership with Telia to provide security services, strengthening Telia’s business offering.
4. A partnership with welfare technology ISV Tellu to deliver a complete device-as-a-service solution for digital homecare across Norway.
Additionally, Techstep announced an extension of its agreement with Sykehuspartner to roll out and manage up to 50,000 role-based mobile devices within the Norwegian healthcare sector:
Detailed Financial Analysis
Breaking down Techstep’s financial performance by revenue stream reveals varying trends across its business segments. While Own Software and Advisory & Services showed resilience, the Device and other segment experienced a significant decline:
Geographically, Norway remains Techstep’s largest market, accounting for NOK 133 million in revenue and NOK 42 million in net gross profit for Q3 2025. The company noted that gross profit growth in Norway was driven by Advisory & Services, partially offset by a 16% decline in device revenues due to the expiration of an unprofitable public frame agreement.
The following chart illustrates the company’s market performance across its operating regions:
From a cash flow perspective, Techstep reported negative operating cash flow of NOK 20.3 million after investments in Device-as-a-Service. The company ended the quarter with a cash position of NOK 13.1 million and noted that additional facilities are available for further liquidity:
Forward-Looking Statements
Looking ahead, Techstep outlined a two-pronged growth strategy focusing on indirect sales for volume expansion across Europe and direct sales for margin growth in Nordic markets:
Management acknowledged that partner sales have taken longer than anticipated but emphasized a "very promising pipeline and partnerships." The company also noted that delays in the rollout of clinical devices are expected for the first half of 2026.
Despite these challenges, Techstep remains committed to its mission of becoming "The Leading European Mobile and Circular Tech partner" with a focus on the Managed Mobility Services market, which encompasses the entire lifecycle of mobile devices from planning and procurement through to disposal, reuse, and recycling.
In the earnings call, CEO Morten Meier stated: "We are on a mission and an exciting journey to become the leading European mobile and circular tech partner. Our ambition is clear: continue to grow and gain market share in both channels and increasing our profitability quarter over quarter."
While Techstep faces headwinds from declining device sales and ongoing investments in IT infrastructure, the company’s strategic refocus and growing recurring revenue base position it for potential improvement in 2026, particularly as new partnerships begin to generate returns and healthcare digitalization projects accelerate.
Full presentation:
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