Earnings call transcript: Adtraction Q3 2025 reveals stable sales, stock dips

Adtraction Group AB reported its financial results for the third quarter of 2025, showing stable sales and a slight dip in stock price. The company’s earnings per share (EPS) were SEK 0.57, unchanged from the previous year, while net sales reached SEK 286 million, reflecting a 2% decline. The stock price experienced a 0.73% decrease, closing at SEK 27.3.

Key Takeaways

• Net sales reached SEK 286 million, showing a 2% decline.
• Earnings per share remained stable at SEK 0.57.
• Stock price decreased by 0.73% in immediate market reaction.
• The company focuses on integrating recent acquisitions and exploring AI opportunities.
• Adtraction anticipates returning to growth by 2026.

Company Performance

Adtraction’s Q3 performance demonstrated resilience amid challenging market conditions. The company maintained its EPS at SEK 0.57, despite a 2% decline in net sales. This stability is attributed to strategic innovations and operational efficiencies, including the development of new tools and services.

Financial Highlights

• Revenue: SEK 286 million, down 2% year-over-year
• Gross profit: SEK 54 million, down 2% year-over-year
• EBITDA: SEK 11.9 million, up 2% year-over-year
• Operating cash flow: SEK 16 million
• Net cash position: SEK 115 million

Market Reaction

Following the earnings announcement, Adtraction’s stock saw a slight decline of 0.73%, closing at SEK 27.3. This movement reflects investor caution amid the company’s reported sales decline and market uncertainties.

Outlook & Guidance

Looking ahead, Adtraction expects a small negative growth in Q4 as it focuses on integrating Affiliate Future, a recent acquisition. The company remains optimistic about returning to growth by 2026, driven by strategic mergers and acquisitions and technological advancements.

Executive Commentary

Simon, CEO of Adtraction, stated, "Our main goal for 2026 is to get back to growth," highlighting the company’s long-term strategy. He also expressed confidence in the profitability of recent acquisitions, saying, "We think that we can turn this [Affiliate Future] into a profitable company fairly soon."

Risks and Challenges

• Market uncertainty due to AI and changes in Google’s strategies.
• Decline in the finance vertical, down 15%.
• Additional costs from the Affiliate Future acquisition.
• European market contraction, with a 15% negative growth.
• Competitive pressures from established players like Awin.

Q&A

During the earnings call, analysts inquired about the impact of AI on traffic and content, the rationale behind the Affiliate Future acquisition, and challenges in the Spanish finance market. The company also addressed the progress of its tracking solution and the potential of its influencer tool.

Full transcript - Adtraction Group AB (ADTR) Q3 2025:

Simon, CEO, Adtraction: Hello and welcome to the presentation of Adtraction third quarter results. CFO Andreas Hagström and I will present, and then there will be a Q&A session. Please post your questions in the Q&A tool that you probably see in front of you, and we will do our best to answer. With that said, we’ll jump straight into the presentation. The short story of the third quarter is this: we’re still not where we need to be in terms of growth. Sales dropped by 2%. Adtraction remains profitable, though EBITA, or operating profit, was at SEK 12 million, which is basically at the same level as last year. E-commerce has been stable. We saw a growth of 7%. That growth, of course, is fueled by the acquisition of AdRecord, which we did in Q4 last year. We’re also seeing a small organic growth, which we think is encouraging.

Also, please note that this is the last quarter where we see growth which is fueled by the acquisition of AdRecord, because we consolidate AdRecord since October 1, 2024. However, this quarter we will add Affiliate Future instead. More on that a little bit later. Finance has been weak or very weak. We saw a drop by 15% in the quarter. I will get back to that later on in the presentation. We still generate a solid cash flow in this quarter, around SEK 16 million. Andreas will dig into the details of that. I will just say that generating a strong cash flow is a core focus for Adtraction and something that we’re constantly working with. If we get paid early, our partners get paid early, and we can deliver better services. All in all, we saw a negative growth rate, gross profit-wise, of 2.3%.

This is related to the finance vertical. We’ve done a lot of M&A work. When you’re doing an M&A transaction, there’s a couple of phases. First, you need to establish contact, and then when it seems like both parties want to do the transaction, we get going. In this case, the Affiliate Future case, basically everything happened in July, August, and September. The whole transaction was basically condensed to three months. I think that we again show that we can efficiently execute an M&A transaction, even if it turns out to be complex in certain regards. More on that also a little bit later. I have noted that everyone is talking about AI, and that means that I will need to talk a little bit about AI too. I will do that in this presentation. I would also like to emphasize that Europe remains our goal.

Awin is a clear market leader in Europe, and I think there is room and need for a challenger, and Adtraction wants to be that challenger. Step by step, we’re going to try to grow in Europe. Let us talk a little bit about the finance. Vertical. We’ve seen weak markets in general, and that is the main explanation for the poor performance. In some cases, though, Adtraction has performed worse than the market in general. That’s the case in Spain, for example, where we probably need to find better solutions for our customers in order to be competitive. We are working on such solutions. I think that it’s also important to point out that Q3 last year was a strong quarter. So the base numbers are very strong.

As a matter of fact, I think that the Q3 last year was the best quarter ever for the finance vertical for Adtraction. What I think is encouraging now is that Sweden is growing in September. What is encouraging about that is that we have seen massive regulation in Sweden, and in spite of that, we’re able to deliver growth. We’re also seeing sequential growth. Q3 is better than Q2 for finance. This should be the case, but it’s still encouraging that this is happening. E-commerce has been stable in 2025, I think. We’re seeing far fewer accounts being closed or paused. We see strong account wins; we’re winning accounts, and we’re seeing a more optimistic outlook from brands.

When it comes to Black Friday bookings, things looked a little bit slow initially, but it seems like bookings are now picking up pace, I would say, in the last week or so. If we looked at the combined picture, I think that we see a stable 2024 and 2025 for finance and e-commerce together. Obviously, this is not where we want to be. We want to get back to growth. If we look at sales, we see the same picture. Again, this is a different way of presenting gross profit growth until 2023 and then stable development 2024 and 2025 after an initial drop in 2024. The most important goal for Adtraction is to get back to growth. If we do that, we will increase EBITA, and we will increase cash flows, and that will create opportunities for us. The question is, how do we get back to growth?

It’s basically the same story as before. The main idea here is that we want to grow together with our partners and customers. When we see a stronger economy and when partners and customers grow, Adtraction too will grow. Of course, we want to increase our market share. That, of course, is a fairly complex exercise. At the end of the day, this boils down to us delivering a better service than competition. This boils down to us delivering better results than competition. I think that we are doing a lot of things to do just that. The second thing is that we need to communicate our solutions to our customers in a better way. We’re also working on that. I think that most people would agree that there’s a lot of uncertainty regarding. AI traffic sources and Google and what Google is doing.

Our impression is that brands perceive a bigger uncertainty when it comes to traffic acquisition and whatever it is that Google is doing now than they did before. The case to diversify traffic acquisition actually makes more sense now than ever. We’re sort of seeing this change in real time. We want to do M&A. Adtraction has acquired five networks. I think that we’re doing more than anyone else in Europe. We’re actively looking for new opportunities, and we’ll continue to do that. We see a lot of inbound leads. To be honest, most of that stuff is not so interesting, but there are some interesting leads inbound that’s popping up here and there. We have started looking at some transactions that are not networks but are sort of related. It’s still AdTech, and they’re still helping retailers grow their sales. It is the same core idea.

Speaking of M&A, we have acquired Affiliate Future recently. I will say a few words about that transaction and the rationale and the company. The company that we acquired is called Internet Business Group, but it goes under, everyone knows that as Affiliate Future. We acquired that from GlobalData. GlobalData is listed in London and has a market cap of around GBP 1 billion last time I checked. Of course, Affiliate Future is a very small part of their business. We announced the transaction on October 10, and we closed it actually late Friday night. We’ve only owned the company formally for a few days. The transaction is a carve-out, which means that it’s a little bit more complicated than just buying some company that an entrepreneur started, which is the case for all other transactions that we’ve done.

It means that we need to spend some time trying to figure out how to separate the business from GlobalData. We need to do service agreements and a few other things. The good news is that we managed to do that too. I think that we learned a thing or two in this process. I think at the end of the day, this was a complex transaction. It’s fairly small, but still a complex transaction. We still managed to do it reasonably efficiently together with GlobalData. Affiliate Future has been around for a while. It was founded in 1999, headquartered in London. Actually, this company was listed on the AIM market for a few years, I think, and then it was acquired and delisted by GlobalData in 2008. They currently have 14 employees, an e-commerce focus. There’s no finance here, e-commerce only, around 200 clients and close to 3,000 partners.

All of this sits on their proprietary platform. There’s no customer overlap with Adtraction. We will add a few new partners here. What we said is that brands will be offered the opportunity to migrate to Adtraction’s platform. In practice, this means that over time, all brands will be migrated to Adtraction’s platform. We will not keep two platforms over time. Most of this work is expected to happen in Q1. We do not want to disturb the important Black Friday and Christmas trading period in either platform, actually. Why are we doing this? First of all, we think that the U.K. is an important market. We established operations in the U.K. in 2019. We are profitable, but we want to be bigger there. The reason we want to be bigger in the U.K. is that the U.K.

is Europe’s biggest market for partner marketing. There is a lot of innovation going on in the U.K., and there is a lot of standard setting going on in the U.K. What happens in the U.K. typically also happens in the rest of Europe in one way or another, sooner or later. There is an industry organization called APMA, which we have been a founding member of. We will, of course, continue to be represented in that organization. We think that the U.K. is a hub for European expansion. A lot of pan-European deals start in the U.K., and with a bigger presence there, there is a greater chance for us to participate in those procurement processes. Affiliate Future brings an experienced team. They bring new brands and partners, and they also bring some sector expertise.

For example, Affiliate Future has done a lot more in the travel space than Adtraction has. We expect to continue to do that and hopefully also to take that to other markets. We do expect some nice network effects when we move brands and partners to our platform. This is what we always talk about. Of course, there will also be some churn. There is always some churn. In general, I think that we have a good process for migrating brands and partners. I think that it is quite clear to basically anyone that we have invested a lot more in Adtraction’s platform, and that probably Affiliate Future’s platform has been somewhat underinvested. Now I will talk about some AI things. I am not going to sit here and talk about how AI will impact society. There are other people with a better view on that.

What I will talk about is how AI may impact our small corner of the universe and share some recent observations. I would like to just start by talking about the usage of AI tools, or more specifically, LLMs. There was a survey done in Sweden, and it turns out that close to 50% of people born in the 2000s use the AI tools instead of Google. Even more people use AI tools whenever Google cannot answer a question. There is a big usage of these AI tools. This is not true only for young people, but it is true for all age groups, and it is increasing across all age groups. Because the usage is so high, I think it makes sense for retailers or brands to think about what they should do. We did a little survey among our clients.

This is not a scientific survey. It is slightly too small, but I think we can still observe a thing or two from the answers that we received. We asked our customers, "Do you currently receive any traffic from AI tools?" Or, sorry, rather, "Are you currently doing anything to receive traffic from AI tools?" Then 50% said that, "Yeah, they are already testing to get some traffic." 20% said that, "Not yet, but we will probably do that soon, within 12 months or so." 30% said no, or they do not know. I think, to be honest, that all of these strategies make sense. The thing is that no one is really getting any traffic from the AI tools. 70% of the respondents in our little survey said that they are essentially getting no traffic from the AI tools.

30% said that they do not know, which means that they are not getting any traffic. There is a few percent who said that they are indeed getting more than 10% of their traffic from AI tools. To me, that actually sounds a little bit strange. I think that this data should not necessarily be completely trusted. What is going on here is, just like we said last time, that the AI tools are stealing content from websites without sending users back. Here, I would like to quote someone called Matthew Prince. He is the CEO of a company called Cloudflare. Cloudflare is an internet infrastructure company. He said this: "10 years ago, Google sent publishers one visitor for every two pages it had crawled. Six months ago, the ratio was one visitor for every six pages.

Now it is one for every 18." Likewise, OpenAI’s ratio went from 250 to 1 six months ago to 1,500 to 1. For Anthropic, six months ago, it was 6,000 to 1. Now it is about 60,000 to 1. That means that these AI tools are crawling content sites, and they are not sending users back. The business model is fundamentally changing for the internet. Just like I said in the last quarter, the reason is that we all find these services great and useful. We tend to communicate with these tools, and we tend to stay within these tools rather than click out. My big question is still, what business model will these companies use? All of them offer subscription services. We have seen experiments with ads. It is not far-fetched that Google and Meta and XAI will work with ad-based models.

I think basically that everyone needs to go in this direction, including ChatGPT. I will say a few words about Google because Google is doing a lot of things. I think that a good starting point to understand what Google is doing is to conclude that Google’s focus is Google. First of all, we have received some reports from clients that because of Google AI Overview, some clients lose up to 20% of their traffic on specific keywords, not in general. What has happened here is that Google has encouraged everyone to produce great content. They say, "Produce great content, and then you will get traffic." Then Google says, "You know what? I changed my mind. I’m going to take that content and present it in an AI Overview, and you will no longer get any visitors." This creates uncertainty, I would say, about Google’s business practices.

I think that if we think that Google’s focus is Google, then we can actually sort of predict what they’re doing. Here, I searched for an expensive click. That’s "låna pengar" or borrow money. That’s a very expensive click. There is no AI Overview in sight here. Nowhere close to this search result can we see an AI Overview. I searched for something that’s a much cheaper click. That’s going to be "skavsor" or blisters. The first thing that is presented here is an AI Overview because there’s no opportunity cost for Google. My take is that if Google can make money from ad links, they will continue to do that. It’s not really the user experience that’s guiding Google’s behavior. It’s their own revenue streams. When there is an opportunity cost to present an AI Overview, we’ll see fewer of those.

This is not a scientific survey or investigation by any means. This is just an observation. I think it works. We can predict how Google will behave. This, of course, has an impact on brands. Maybe be a little bit careful to put all of your money in that Google basket. A couple of weeks ago, maybe two weeks or so, we’ve seen AI mode in Sweden. I think people are not talking about it so much, but I think that we can expect the same behavior from Google here as we’ve seen in AI Overview. A company that’s been very active in all sorts of ways, doing deals left and right at all times, is ChatGPT. We’re just going to look at what they’re doing when it comes to our corner of the universe. First of all, again, we see the young people dominating the use of this model.

Up to 50% of messages come from users aged 18 to 25. They are totally dominating when it comes to the usage of ChatGPT. Very few messages, only around 2% in this report that we saw, actually use ChatGPT to find products that they can purchase. You do a lot of other stuff with this. That is because ChatGPT is a productivity tool and not a shopping tool. People currently use that for productivity purposes rather than shopping purposes. Of course, this may change. This may change. We are seeing that ChatGPT is doing a number of initiatives which is related to e-commerce. They have done a deal with Shopify about an instant checkout. They are partnering with Etsy in the US and with Walmart. I think that these things are like test balloons in one way or another. I personally do not believe much in the instant checkout concept.

I think that in order to see massive volume, ChatGPT and OpenAI will need to start working with ads, which again will create quite a different user experience. If they do, that means that Adtraction’s partners can acquire traffic from ChatGPT in the same way that they currently acquire traffic from Google. The business model stays sort of intact, but traffic is moving from Google to ChatGPT. A big question mark here, of course, is what will happen to these shopping agents. The honest answer is that we do not know. We need to follow this development. Fundamentally, a partner marketing network such as Adtraction can be used to give commission to anyone who is building a shopping agent. Just take a tracking link, and that will work out nicely. This is very early days, and we have not seen any of that materialize yet.

Speaking of partners and AI, I think that we have some interesting observations regarding partners’ role in the ecosystem. The first observation is that partners can help brands for specific products be seen in the AI search results. For some reason, I wanted a mascara. I had no idea what I should buy. I just asked ChatGPT, "What mascara should I buy? Which one is best?" ChatGPT suggests that I should buy Maybelline, Lancôme, L’Oréal, or something like that. ChatGPT also says that the reason that I say this, the reason that I, ChatGPT, say this, is that Metromode, Elle, Bestitest, Skönhetsguiden say that these brands are great. All of these sites that ChatGPT is referring to is working with Adtraction partners.

If someone were to click one of those links that you find in the search results, you would end up at an Adtraction partner that is linking to Adtraction brands. It is quite clear that for the reasons that I stated before, it is quite clear that most people do not click those links. It is clearly better to be seen indirectly here than to not be seen. This brings us to the second point here, that partners can also help retailers be visible in, for example, ChatGPT. I had no idea where I should buy my mascara. I had no idea where to get that. I asked ChatGPT, and the answer was Lyko. That seems reasonable, I think. Lyko is a big retailer. But I also asked ChatGPT, "Why do you say this, ChatGPT?" And ChatGPT is then referring to Bestitest and Femina, which are Adtraction partner sites.

If you click on those, you’ll once again find links to Lyko. Lyko is probably not getting a lot of traffic here. With all of this uncertainty, it’s obviously much better to be seen in the AI results than to not be seen. To work with partner marketing and Adtraction is a sure way to be seen in the LLMs. We have demonstrated this for many brands. A lot of people who are working with this type of optimization actually recommend partner marketing. The logic here simply is to look at what are other people saying about the particular brand. That seems reasonable. I’m just going to go ahead and quote that. That’s what ChatGPT is currently doing. The main point here is that we should not, or no one, no retailer or e-commerce company should put all of their eggs in that Google basket.

I think that it’s probably more risky now than ever to do that. We’re also seeing that brands are willing to listen to that. They understand that it’s super risky to put 50%-60% of their budget in that Google basket. That was my little AI Overview for this quarter. Let us go back to the numbers. I will say a few things, and then I will pass the mic to Andreas. This is a graph of Adtraction’s employees. What has happened here is that we acquired AdRecord in the first quarter of 2023. The number of employees increased. As we performed a little bit worse, the number of employees decreased throughout 2024. We did acquire AdRecord in the fourth quarter 2024, and the numbers jumped up a little bit and have since decreased. Now, in the third quarter, we’re slightly increasing again.

Of course, what will happen in the fourth quarter is that that number will increase by 14% because of the Affiliate Future acquisition. We’ve tried to be disciplined when it comes to costs. We’ve tried to keep costs down. Obviously, what will happen now is that the cost will increase as a result of the Affiliate Future acquisition. Probably we will add slightly less than SEK 1 million per month or slightly less than SEK 3 million per quarter as a result of this acquisition. With that said, I will pass the mic to Andreas. Thank you, Simon. Starting with net sales, we have SEK 286 million. That is a negative growth of 2%. If we were to exclude currency exchange effects, we would have had a growth of 0% instead. Looking at gross profit, we have SEK 54 million. Also that, a negative growth of 2%.

The same thing goes for currency exchange here. It would have been 0%. Profitability, starting with EBITDA, we have SEK 11.9 million, and that is an increase by 2%. We can see the same seasonality effects as previous years, lower cost base in the third quarter due to vacation pay. For transparency and comparability, we also present one-off costs of around SEK 1 million in the quarter. You can see that in the other external costs in the P&L. For last year, we had one-off costs of SEK 2.5 million, mostly related to personnel costs. If we were to add back the costs of SEK 2 million in AdRecord for 2024, which is not presented in the consolidated results of that year, we can also see that we have slightly lowered our total cost base year to year. Adjusted net result per share, SEK 0.57.

That is the same as last year. Verticals, starting with e-commerce, we have SEK 31.3 million in gross profit. That is a 7% growth. We can see that we grow on 7 out of 12 markets. As Simon mentioned, we can also now see slightly positive organic growth in this quarter. The finance vertical, SEK 21.7 million gross profit. That is a negative growth of 15%. If we look for the positives here, we can see that the Swedish finance vertical is back to pre-legislation numbers. What we have said before is that we are going to take a hit in the Swedish market due to legislation. What happened now is that we can see sequential growth month over month since April up until October. We can also see year-over-year growth in both September and October for the Swedish finance vertical.

Looking at the vertical as a whole for finance, we can also see that we have growth on three of the smaller markets. Looking at the other vertical, which is everything outside of the Adtraction platform, we see SEK 1 million in gross profit. Geographies, the Nordics, we have SEK 41.8 million, and that is a 2% growth. We can see growth on two out of four markets. In Europe, SEK 12.2 million in gross profit. That is a 15% negative growth, most of which comes from the headwinds in the Spanish finance market. We can also see finance as a whole as well, because we can see growth on two out of eight markets in Europe. Looking at cash flow, we can see that we bounce back when it comes to working capital. We have a positive effect in the third quarter.

We can also see on a rolling 12 basis that we have a good operating cash flow on the blue line above. The operating cash flow for the quarter is SEK 16 million. We have small investing activities on minus SEK 0.3 million, giving us a total cash flow of SEK 15.7 million in the quarter and ending on a net cash position of SEK 115 million. By that, I give the mic back to you, Simon. Thank you, Andreas. Our goals also remain the same. The core of Adtraction is that we want to deliver growth, profitability, and cash flows. The main focus, of course, again, is to get back to growth. Adtraction wants to be a European network. We think there’s room for a hungry challenger that challenges Awin. In order to do that, we need to be a leading consolidator.

I think it’s fair to say that we are a leading consolidator. We’ve done most of the transactions in our space. To be honest, we rarely see any competition, any real competition when we buy something, which to me tells me that we are the ones driving this. We want to serve a wider range of clients, and we’re going to update our platform to make it easier to work with smaller clients. We also have a number of initiatives to work with bigger clients. Everyone essentially should be able to find a home at Adtraction. What’s happening now is the question. Again, we want to get back to growth. This is our main goal for 2026. We do not think that we will see growth in Q4. We expect a small negative growth. Again, this is related to the finance vertical.

We will focus a lot on the Affiliate Future integration to make that team a part of our Adtraction and to migrate everything to our platform. We are looking forward to more M&A opportunities. To be fairly transparent there, there’s nothing concrete going on right now. There are some discussions, but there’s no live process or anything like that. I don’t expect to announce anything in the next few months, at least. We think that Bundler is doing quite well. In the report, I wrote that we believe that they have product-market fit, and that means that things are starting to happen a little bit on their own. There’s a lot of companies that understand that Bundler provides a great value and a great service. Bundler is building more and more integrations, and the Bundler team is very proud that they recently helped Klarna launch some of their credit cards.

Bundler is providing some of the services related to that. This was the presentation for today. We have received a number of questions, as usual. We’re, of course, grateful for that. We’re grateful for the interest in Adtraction. I’m just going to go ahead and start reading here. The first question is this. Given that the finance vertical exhibits higher margins than e-commerce, could you shed some light on how the margins can hold up given the mixed effects during the last quarter? It’s actually the other way around. E-commerce has higher gross profit margins than finance, and I think this probably explains the development that you’ve seen. The question is, could you shed some light on growth initiatives in other Europe and when we can see a pickup in momentum in these markets?

We are doing a lot of different projects that are long-term in nature that I think will help us grow going forward. A big thing here is that we are doing a process to clarify our offering. We are going to work with different tiers, and pricing will be very clear. We are also working with a better international offering, and all of these things will help boost growth. They are mainly long-term projects. In order to get back to growth, I think we basically need a stronger development in the finance vertical. Here is a question that is very much related indeed. I will still read it, and then I will try to answer whatever I have not answered before. You have several initiatives ongoing that seem to be growth-related: the tracking project, the influencer tool, Salesforce, and also Bundler.

Can these initiatives get Adtraction back to growth, or do you also need a general market recovery? Yeah, I think that longer term, these efforts probably will help us. Short term, we will need a bit of a market recovery. We should remember, however, that we are not super far from growth. If we adjust for FX, we were actually at the 0% growth rate in the quarter when it comes to sales. Everything that we do that generates a little bit of growth, for example, the tracking project, will help in that regard. Do you have any insights into Black Week as of now? How is the activity from advertisers looking? Are they more or less optimistic compared to last year? This is a good question. Here is the thing. Up until very recently, things looked sort of bad, to be honest.

We have seen a great pickup in activity in just the last week, and we are now seeing good momentum. As usual, that does not necessarily translate into sales or gross profit, but at least we are seeing good momentum, and we are hoping that we will also see good development for sales and gross profits. You have previously mentioned that clicks and conversions have seen growth for the past couple of years. The reason why Adtraction is not growing is due to commission levels that have declined. Can we have an update on the commission levels as of today? It is not only the commission levels. I would say that to some extent it is the commission levels, but it is also related to order value. If order value drops, we will typically get a lower commission, even if the percentage commission is the same.

It is also a question of product mix. What are we getting paid for? This actually is a fairly complicated thing to sort out. To answer this specific question, I would say that we have not seen a drop in commission levels recently. If anything, they’re slightly increasing. When this plays out very nicely, both commission levels and volume will increase, and that will result in growth. A question regarding Affiliate Future. It seems like you’re paying around SEK 15 million for a company that is not generating any profit. This differs from the past. What is your view on this? Yeah. Clearly, Affiliate Future has lower profitability than the companies that we acquired before. I also think that Affiliate Future has not been prioritized by the former owner. They were not focusing on this.

We intend to focus on Affiliate Future, and we think that we can turn this into a profitable company fairly soon if they have better processes, a better platform, and access to better systems. We would expect Affiliate Future to be as profitable as some of the other companies that we have acquired. Here’s another question about Affiliate Future. Do you expect the network effects when customers migrate to the Adtraction platform to result in more conversions from Affiliate Future’s existing customers? Yeah, is the short answer, but I’m not going to answer the second part of that. If so, how much more? Because we honestly do not know that. I think that our tracking is slightly more up to date. I think that we can handle consent problems and app tracking and deduplication and so on a little bit better than Affiliate Future with their platform.

It is very difficult to put a number on that because we, to be honest, really have not started that process. In general, I expect better conversion, but also there will be some churn. There always is some churn related to this. Let’s see if we have some more questions. There were actually a lot more questions. We’re just going to keep going. First, the question about Affiliate Future. What’s your plan for Affiliate Future? On their website, they state 600 advertisers some years ago, but now they state, or you state, 210 advertisers. What has caused this decline? First of all, the main problem here is that Affiliate Future’s site is not properly updated. Of course, it should have been updated.

I think that what’s going on here is that I do not know how old that number is, 600, but what happened was that Affiliate Future used to be very much focused on travel. Then COVID hit, and they saw a big drop in sales and revenue related to COVID. After COVID, they diversified their portfolio, and they’re now much less dependent on travel. Travel is, of course, still an important vertical for Affiliate Future, but not the way it used to be. I hope that answers your questions. Could you resonate a little bit about multiple pay for Affiliate Future, SEK 50 million for SEK 0 million in EBITDA? Please help us thinking about this. What you’re saying here is essentially true.

Maybe there is a little bit of profitability going on at Affiliate Future, but what we’re paying for is actually the gross profit, the contracts, the partners, the expertise of the team, and I am convinced that we will turn this into a profitable operation. Of course, as a seller, you wouldn’t expect to accept SEK 0 million for when you try and sell a company. Someone is willing to pay something. Of course, there’s been a lot of price negotiations in the process here. Another question about e-commerce. I’m just now reading questions in the order that they appear, so we’re going to swing from topic to topic here. It seems like Swedish e-commerce performed well during the third quarter, according to public data like E-handelsbarometern. Is there any reason why you do not see an acceleration of growth in the e-commerce segment?

First of all, I agree that we’re not seeing an acceleration. We’re seeing a stable development. This question pops up from time to time, and there are a couple of different reasons here. First of all, e-commerce to Adtraction is anything that’s not consumer finance. We would include things like insurance, streaming, audiobook services, and a lot of those things, or electricity for that matter. A lot of those things are not included in the E-handelsbarometern. When it comes to E-handelsbarometern, I don’t think that their method of measuring things is that accurate, actually. Maybe take a look at that. I think the main thing is that we’re sort of measuring different things here. Are you still active in M&A discussions with other companies? Can we expect more acquisitions in 2026, or is Affiliate Future enough? Affiliate Future clearly is not enough.

I think that we have demonstrated that we are the leading consolidator here. We will keep looking at other networks. Like I said in the presentation, we may actually look a little bit outside our core business and buy companies that sort of help retailers with the same thing, increase sales at a predictable cost. We don’t know yet. There’s always some discussion going on. I would actually be surprised if we don’t do a deal in 2026. Again, these things take time. What countries within the finance vertical are the most challenging? Clearly, that is Spain. Spain has been very challenging. I think that the market there is changing. The way that different players are cooperating is changing. Our performance in Spain is worse than the general performance of the market. We need to update our offering and provide a somewhat different service to our customers.

Our team in Spain is working on that. At some point, we will see a different development. Also, things have been challenging in Norway recently, but that’s mainly related to strong performance in 2024. Here’s another question. It seems like Affiliate Future has some. Tilt towards travel. Could you help us understand the seasonality in the business? Is Q4 the strongest? It’s not as e-commerce heavy as Adtraction, but it has a little bit of a tilt towards Q4, yes. In general, of course, the travel season happens in the summer months, and then there’s going to be some delays with payments and so on. I don’t think that Affiliate Future will affect the seasonality of Adtraction as a whole. It’s a little bit too small. Another question here.

Do you envisage Affiliate Future to burden profits initially, given its carve-out before recouping that later on, thus putting it on a net neutral contribution over the next year? Yeah, probably we will have a fairly neutral contribution for a while. I don’t know exactly the time perspective. We’re now starting to work with the Affiliate Future team to see what can be done. We, anyway, do not like losses. That will not happen. This will either be profitable or it will be sort of neutral. How large part of the gross profit do you expect to lose when forcing to change platform for Affiliate Future customers? I want to use a different verb here than forcing. We are more or less giving them access to a much, much better platform. They should welcome that. Having access to Adtraction’s platform will create opportunities.

Yes, of course, there will be a churn. Sometimes because the customer wants to do something else, sometimes maybe because we don’t want a specific customer on our platform. If I were to say a number, I would say we can migrate 90% of gross profit or a little bit more or a little bit less. That means that there will be like a 10% churn or something like that. In the best of worlds, it’s lower than that. Here’s a question for Andreas. Your working capital has supported free cash flow generation of late. How should one think about your ability to retain current working capital in relation to sales levels? Like we previously mentioned, I’d say that it’s going to be normalized. We have made initiatives that have had big effects, like you’ve seen in the last couple of quarters.

Now we should be seeing a normalized working capital comparing to the sales, yes. We’re faster to invoice, but you could say that the project, so to say, of this is more or less over or closed. All right. Here’s a question, I guess, for me. When should one expect finance to stabilize? To be honest, I expected that to happen already because we’ve seen lower interest rates, and we’ve seen perhaps a more stable economy in that regard. We’re a little bit surprised by some of the development here. To be honest, I cannot set the date or time frame here. All we can do is focus on providing a great service to our partners and brands. Over time, we are confident that we will resolve this. Please remind us how our margins grow in EBITDA impacted by a smaller share of finance. Again, we see.

We have higher margins, gross profit margins in e-commerce, everything else equal. On the other hand, I would say we are more efficient in the finance space. EBITDA across the finance team is greater than EBITDA across the e-commerce team. It is a little bit tricky to sort that out, and we actually do not report at that level. Those are the main things. Has Affiliate Future been growing prior to being acquired? No, not really. They saw a big drop in connection with COVID, and since that, it has been a more or less stable business for a few years. How large is negative growth in gross profit from the Swedish finance vertical? We are not disclosing things at that level, unfortunately. What we have disclosed is that we have been back to growth for September and probably October in finance.

What we are seeing is that, I think that is encouraging, like I said before, because that shows that we can get back to growth also after a massive and very strange regulation. What has been the main reasons for not returned to growth during 2025 in your review? I think that the main reason is the performance of the finance vertical. I would argue that is the main reason. If we did not see a significant drop in finance in the third quarter, we would have been back to growth. You may recall that we saw a strange development in Q2. We were expecting to return to growth. What did Trump call it? Liberation Day happened. That caused a lot of uncertainty in the market. It caused a lot of uncertainty. The market recovered, but that, of course, also had an impact. Here is a question from you, Andreas.

I do not know if you know this on top of your head. Other external costs rose from SEK 10 million in the second quarter to SEK 13 million in the third quarter. Why? What do you expect going forward? We expect it to be slightly around those numbers as well. What we said now is that we have a one-off effect there of SEK 1 million. There has been some previous personnel costs that are now also external costs due to contracts reasons. TradeDoubler has experienced strong growth across most markets. How does your performance compare to peers? Are you underperforming, or is TradeDoubler outperforming? I would say neither. If you look at TradeDoubler’s report, you will see that in the Nordics, they had negative growth. Adtraction is 75% a Nordic business. I think that we are sort of both performing in line with markets.

Also, I think that TradeDoubler has done something very impressive with MetaPick. They see growth across many markets with MetaPick. Can I give an addition to my previous answer as well? If you were referring to the third quarter or higher in the second quarter, we also had our yearly annual conference. Of a one-off effect as well of SEK 2 million in other external costs there. All right. How much of finance in Sweden? Unfortunately, we’re not disclosing that per market. Then we had a question about other costs again. That’s the same answer as before. How do you work with M&A? Do you want to be finished with integration before you move on to the next target, or could you, for example, acquire two companies in the same quarter? I don’t think that we have a small M&A team.

I don’t think that we realistically could acquire two companies in the same quarter. What we can do is to work with integration and start looking at other things. Now there’s going to be full focus on integration and migration. We’re already looking at other things. It is not necessarily the same team that’s doing these different things. Could you update on the tracking solution for your advertisers? How has this progressed? Yeah, this is an ongoing project. I think we have good momentum. As often happens, we need a little bit more time than we expected to start this process. Now I think we have good momentum. Brands understand that they need to compensate if tracking is not executed for consent reasons. I think in general, this process is going good. I expect this to have an impact on our business.

It will take some time before we can see the effects of this. We have a team that’s working on this right now, and things are happening every day. Here’s a question that I’ve actually been waiting for. Here we go. Curious about your influencer tool. How does this differ versus current solutions on the market? Will this be a separate platform from your Adtraction platform? The reason that we mentioned this tool in the report is that you may in a couple of months see something from Adtraction. We just wanted to inform investors in advance. I would like to remind the listeners here that Adtraction is working with influencers already. We have a lot of collaborations with influencers. What’s going on now is that we will have a better user interface for these influencers.

It will still be based on Adtraction’s platform, but we will have a user interface that’s much better suited for influencers as we see it. Probably there will be other commission models in play also. I’m not going to say so much more about that at this stage, but we will talk more about this going forward as we launch this thing. We learn things, and then we also understand the potential in it. I think that’s it. Those are the questions that I can see to date. I thank you for listening. We’ll see you next quarter. Thank you very much.

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