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Investing.com -- DocMorris AG on Tuesday reported disappointing second-quarter results, with prescription (Rx) growth falling short of expectations at just 4.6% quarter-over-quarter in local currency, totaling CHF56 million.
The Swiss online pharmacy posted external revenues of CHF276 million in Q2 2025, representing a 3% year-over-year increase but a 7% quarter-over-quarter decline.
This performance reflects seasonal softness and the impact of German holidays.
German prescription sales were the only domestic growth driver, rising 4% quarter-over-quarter and 31% year-over-year to CHF56 million, though this trajectory remains behind expectations and main competitor RDC.
Over-the-counter (OTC) and Services declined 10% quarter-over-quarter and 3% year-over-year to CHF203 million, partly due to the discontinuation of the Zur Rose (SIX:DOCM) brand and strong foreign exchange headwinds.
One bright spot was TeleClinic, which grew rapidly by over 150% compared to the same period last year. The European segment also showed positive momentum, growing 4% quarter-over-quarter to CHF17 million.
Adjusted EBITDA remained largely unchanged at -CHF29 million despite the 4% better top line. Regional adjusted EBITDA in Germany declined 44% year-over-year.
Reported EBIT was down 10% half-over-half and 13% year-over-year due to continued marketing investments, particularly burdened by upfront costs for the TV campaign in Q1.
Operating cash flow (-CHF56 million) and free cash flow (-CHF144 million) were particularly weak in the first half and need significant improvement to meet management’s target of breaking even within the next 2.5 years.
Despite these challenges, DocMorris reiterated its full-year 2025 guidance, including over 10% external sales growth and adjusted EBITDA of -CHF35 million to -CHF40 million, which factors in CHF15 million of incremental Rx marketing spend.
Prescription sales are expected to grow at least 40% this year, with capital expenditure remaining at CHF35-40 million.
The company continues to expect EBITDA break-even in 2026 and free cash flow break-even during 2027. The EBITDA guidance implies a clear step-up of more than 170 basis points in profitability for the second half of 2025.
With the European Court of Justice ruling on prescription bonuses now in place and marketing intensity ramping up, the second half of 2025 should be a constructive period for prescription adoption, potentially offering investors greater visibility and reducing uncertainty over future growth.
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