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Investing.com -- MIPS AB (ST:MIPS) shares rose 6.1% after the Swedish helmet safety technology provider reported solid organic growth across all helmet categories in the third quarter, despite headwinds from legal costs and currency effects.
The company posted net sales of SEK 135 million for the third quarter of 2025, up 10% from SEK 123 million in the same period last year. Organic growth, adjusted for currency effects, was significantly stronger at 19%. However, operating profit decreased 7% to SEK 44 million from SEK 48 million a year earlier, with operating margin falling to 32.6% from 38.5%.
The decline in operating profit was primarily attributed to SEK 13 million in legal costs related to a lawsuit involving one of Mips’ U.S. customers. While Mips is not a party to the suit, the company has chosen to engage since it concerns areas where Mips has intellectual property rights.
"During the quarter we saw good development with an organic growth of 19 percent and growth in all our categories. This is despite the fact that the tariffs in the for us important US market continues to create uncertainty," said Max Strandwitz, President and CEO.
Sales growth was evident across all helmet categories, with Sports up 8%, Motorcycle up 28%, and Safety up 26%. Geographically, Europe showed particularly strong growth of 73%, while North America declined by 8%, impacted by tariff uncertainties.
The gross margin improved slightly to 74.2% from 73.4% in the same quarter last year, reflecting a favorable sales mix. Diluted earnings per share decreased to SEK 1.29 from SEK 1.37 a year earlier.
Cash flow from operating activities increased by 14% to SEK 41 million, driven by improved working capital management.
"Despite the challenges consumer goods companies with significant exposure to the US have faced during the year due to major and sudden tariff announcements, we have once again been able to demonstrate the strength of our business model and our offering," Strandwitz added.