Teneo AI Q2 2025 slides: 60% SaaS ARR growth amid conversational AI market expansion

Introduction & Market Context

Teneo AI AB (TENEO) presented its Q2 2025 financial results on August 19, 2025, highlighting strong growth in its SaaS business amid an expanding conversational AI market. CEO Per Ottosson and CFO Fredrik Törgren led the presentation, which emphasized the company’s improved financial metrics and strategic positioning in an increasingly competitive landscape.

The presentation highlighted that conversational AI is rapidly replacing legacy IVR systems, with a projected 200% increase expected from 2025-2026 according to DMG Consulting, positioning Teneo to capitalize on this market shift.

Despite the positive operational results, Teneo’s stock declined 1.21% on the day of the presentation, closing at SEK 0.58, extending a recent downward trend that has seen the stock trade significantly below its 52-week high of SEK 0.95.

Quarterly Performance Highlights

Teneo reported substantial growth across key performance indicators for Q2 2025, with SaaS ARR increasing 60% year-over-year in constant currency to SEK 70.1 million, while total ARR reached SEK 89.7 million, representing 21% growth compared to Q2 2024.

The company’s SaaS API call revenues showed particularly strong performance, growing 81% year-over-year to SEK 12.7 million, with API call volumes increasing 69% to 53.2 million calls during the quarter.

As shown in the following chart of key performance indicators:

Net revenue retention remained strong at 129%, indicating high customer satisfaction and expansion within existing accounts, though slightly down from 142% in Q1 2025. The company maintained 100% recurring revenues with SaaS representing 73% of the total.

Teneo achieved a record gross margin of 88% in Q2 2025, showing consistent improvement from 79% a year earlier, as illustrated in this quarterly trend:

Net sales increased 15% year-over-year to SEK 22.1 million, while adjusted EBITDA improved to -SEK 3.9 million from -SEK 6.3 million in the comparable period, showing progress toward profitability.

Strategic Initiatives & Competitive Positioning

Teneo emphasized its competitive advantage in accuracy, presenting third-party testing data showing its platform achieving 95% accuracy out-of-the-box, significantly outperforming competitors including Amazon (NASDAQ:AMZN) Lex (89%), IBM (NYSE:IBM) Watson (81%), and Google (NASDAQ:GOOGL) DialogFlow (74%).

The company’s accuracy advantage is illustrated in this comparative analysis:

A key strategic development highlighted was Teneo’s partnership with Genesys as the sole Agentic AI partner on AppFoundry, creating a synergistic integration that directly drives consumption of Genesys AI Experience tokens through a joint sales strategy targeting high-value segments.

The presentation referenced Nice’s recent acquisition of competitor Cognigy for 955+50 MUSD (representing 26x sales multiple), suggesting significant industry consolidation and high valuations in the conversational AI space, which Teneo characterized as "The AI arms race in CX."

Teneo also highlighted its #1 ranking in customer satisfaction across all nine vendor categories in the latest DMG Conversational AI Report, achieving perfect 5.0 scores in implementation, training, professional services, support, vendor communication, pricing, and overall satisfaction.

Detailed Financial Analysis

The company’s SaaS business model showed consistent growth in API call volumes over multiple quarters, with a slight decrease in Q2 2025 (53 million) compared to Q1 2025 (61 million), but still representing a 69% year-over-year increase.

This growth trajectory is visualized in the following chart:

Teneo maintained disciplined cost control, with OPEX run rate stabilized at SEK 117 million in Q2 2025, unchanged from Q1 2025 levels, while continuing to invest in sales and marketing activities.

The company reported a cash position of SEK 41.1 million at the end of June 2025, with an additional SEK 8.3 million in accounts receivable collected in early Q3, bringing the adjusted cash position to approximately SEK 49.4 million.

The sales pipeline showed significant expansion, with the 12-month subscription pipeline growing from EUR 266,000 in October to EUR 2,045,000 in June, indicating strong future growth potential. The average Teneo customer subscription was reported at EUR 9,900 per month (EUR 118,800 annually).

Forward-Looking Statements

Teneo outlined its U.S. market expansion strategy, highlighting recent key hires including Lee A. Kayne (CX Sales and Partnership Leader, formerly with Aspect and Genesys Cloud) and Michael Kenney (GM/US Director, previously with Ingram Micro, Dropbox (NASDAQ:DBX), and Symantec (NASDAQ:GEN)).

The presentation acknowledged potential impacts from the recent U.S. election, including a focus on local U.S. delivery, cost savings initiatives, dollar currency effects, and uncertainty in sales cycles.

The company plans to continue investing in sales and marketing activities throughout 2025 but noted it would "carefully steer investments based on customer wins," suggesting a measured approach to growth spending.

While the presentation highlighted strong operational metrics, investors appear cautious, as reflected in the stock’s recent performance. Teneo trades well below its 52-week high of SEK 0.95, with the stock closing at SEK 0.58 on the day of the presentation, suggesting the market may be looking for further evidence that growth metrics will translate into sustainable profitability.

Full presentation:

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