Earnings call transcript: WithSecure sees revenue growth, stock falls in Q2 2025

WithSecure Oyj’s earnings call for the second quarter of 2025 revealed a mixed financial performance, marked by a modest revenue increase but a notable decline in stock value. Despite a 3% rise in total revenue and positive developments in cloud services, the company’s stock dropped 7.4% following the announcement. According to InvestingPro data, the company maintains a "Fair" overall financial health score, with particularly strong price momentum metrics. The decline reflects investor concerns over the company’s managed services and strategic shifts, though analysis suggests the stock may be undervalued at current levels.

Key Takeaways

• Total revenue increased by 3% in Q2 2025.
• Managed services revenue declined by 22%.
• Stock price fell 7.4% following the earnings announcement.
• Company continues to restructure and focus on mid-market opportunities.
• Positive outlook for cloud services with ARR growth guidance maintained.

Company Performance

WithSecure reported a 3% increase in total revenue for the second quarter of 2025, driven largely by growth in its Elements Cloud and Co Security Services, which expanded by 13%. However, the company’s managed services segment experienced a significant 22% decline, contributing to investor apprehension. The company has been actively restructuring, including the divestment of its consulting business and Malaysian entity, to streamline operations and focus on mid-market opportunities.

Financial Highlights

• Revenue: Increased by 3% year-over-year.
• Cloud ARR: Grew by 3%.
• Combined Net Revenue Retention (NRR): Maintained at 99%.
• Managed Services: Declined by 22%.
• Estimated annual cost savings from restructuring: €6.5 million.

Market Reaction

Following the earnings announcement, WithSecure’s stock price fell by 7.4%, dropping from a previous close of €1.054 to a lower value. While this reaction highlights investor concerns over the decline in managed services, InvestingPro data shows the stock has gained an impressive 44.19% over the past six months. The stock’s movement contrasts with its 52-week range, where it previously peaked at €1.11 and hit a low of €0.698. Based on comprehensive Fair Value analysis available on InvestingPro, the stock appears to be trading below its intrinsic value, suggesting potential upside opportunity.

Outlook & Guidance

WithSecure remains confident in its growth trajectory, maintaining its ARR growth guidance of 10-20% for its Elements services. The company is optimistic about its Cloud Protection for Salesforce, projecting a growth outlook of 20-35%. Additionally, WithSecure expects its EBITDA to be between 3-7% of revenue, bolstered by partner momentum in the second half of the year.

Executive Commentary

CEO Antti Koskela emphasized the company’s innovative strides, stating, "We are able to detect vulnerabilities that nobody knows exist currently." He also noted the acceleration of digital sovereignty discussions in Europe, positioning WithSecure as a significant player in this space. CFO Tom reiterated the company’s commitment to its medium-term financial targets, despite the current challenges.

Risks and Challenges

• Decline in managed services could impact overall revenue growth.
• Ongoing restructuring may lead to short-term operational disruptions.
• Currency fluctuations could affect financial performance, as seen with a €400,000 foreign exchange impact on ARR.
• Competitive pressure from other European cybersecurity firms like EZ and Bitdefender.
• Shifts in technology preferences, particularly the move away from U.S.-based technologies, could alter market dynamics.

WithSecure’s strategic focus on cloud services and mid-market opportunities presents potential growth avenues, yet the company must navigate the challenges posed by its declining managed services and restructuring efforts to sustain investor confidence and market position. With a current ratio of 1.21 and year-over-year revenue growth of 13.28%, the company shows promising fundamentals despite near-term challenges. Discover more insights and detailed analysis in WithSecure’s comprehensive Pro Research Report, available exclusively to InvestingPro subscribers, along with 12 additional ProTips that could help inform your investment decisions.

Full transcript - WithSecure Oyj (WITH) Q2 2025:

Laura Witta, Investor Relations Director, WitSecure: Very good afternoon from the very, very warm and sunny Helsinki, and welcome to My name is Laura Witta. I am the Investor Relations Director of WitSecure and happy to wish you welcome to the 2025 results release. Today, we will first have our CEO, Antti, talk through the business highlights, especially the breakthroughs made in the proactive threat management with our new tools and other things, of course. After Antti, there’s going to be the CFO, Tom, talking through the financials of the quarter. We will have questions and answers at the end.

If you have questions, you can send them over the webcast all the time. I will take them up with the presenters at the end. So warmly welcome. And with this, I’m handing over to the President and CEO of WitSecure, Antti Koskela.

Antti Koskela, President and CEO, WitSecure: So thank you, Laura. So first, I would like to go through the strategy and then I go to the financials, so that it has been a very busy quarter for us. And what has really happened during the second quarter is that digital sovereignty discussion accelerated in Europe. And this was quite a lot intensified by the removal of the email from ICC Judge by Microsoft and following the U. S.

Administration decision. And a lot of discussions started on becoming more European ever since. It was not only us talking about it. So it’s a theme that is in the market. And it’s clearly influencing already technology choices done by the partners.

And we met many of our partners and customers in our Sphere event here in Finland in May. So we had around 400 customers and partners here and majority of them were new ones first time with us and clearly signaling the increased trend for new partners coming to work with Secure. And we will have more smaller marketing sessions Sphere to use through the rest of 2025. We actually have already had one in Germany and we will have one in Japan and France through the rest of the year. And what we launched in at Sphere event, so we launched extensions to our Elements Cloud and Co Security Services as everything we do evolves around Elements.

So, we took exposure management to new level by expanding the scope to various cloud platforms and also identities. And then we extended coverage of our extended detection and response to cover well the Azure cloud environments. And then we packaged all our managed services and software into easily purchasable bundle Elements Infinite that we also launched to the market. But what Laura was suggesting in the beginning, this zero day vulnerability detection, this is quite groundbreaking. So we are able to use telemetry from our EDR tools and the behavioral data and use that with AI models, so we can detect vulnerabilities that nobody knows exist currently.

This has usually been a work for security consultants and it takes a rigorous weeks and weeks of work. We have been able to do breakthroughs with the use of AI. So this gets to the new level of proactive threat management and this technology will of course be integrated to our exposure management products as we move further. But the combination of exposure and the XDR and the whole elements is here the key. That’s why it’s so powerful.

We are also busy during the quarter, so we did two transactions. We closed two transactions during quarter two. So we closed Consulting, which is now called Reversek. So that divestment was closed on June 1. And we also divested our Malaysian entity and we transferred that to the buyer LS Systems and who became the preferred distributor for WidSecure in the region.

And the start has been quite rapid and we are looking positively towards the work with LS Systems in the region. And it’s also a very effective way for us to do marketing and sales in the region without having own feet in the ground. And then our key strategy is to work on these mid market customers and the partners serving them, because most of our pipeline comes with the partner development, how we extend the scope with the partners. So, we have extended our partnerships in Japan. So we are launching Elements MDR in Japan.

We are extending many historical endpoint protection only partners to EDR to access the Japanese mid market. In Netherlands, we have a quite broad spectrum of managed service providers. And we signed after Sphere actually. I met the CEO at the event and had a handshake that said they take WidSecure as the number one supplier, because they need a European solution. So that was done.

And also in Finland, you may have seen that we launched partnership with DNA. And so DNA, it’s going heavily to the part and the cybersecurity in collaboration of WidSecure and Google, so that these form a combination. So a lot of groundwork is done. And unfortunately, not all the groundwork is in the numbers yet, but we made what we are doing with the partners creates a good path for the funnel for the second half. And that’s where our confidence comes from how we are talking here.

We grew Elements Cloud and Co Security Services 13%. And this growth is increasingly driven by the new products Exposure Management Elements MDR partners going with the mid market playbook with the wide portfolio. And of course, the deal sizes with the wider portfolio are higher than with just selling Endpoint Protection. And then the negative part. So unfortunately, like we said in the Investor Day, so we had certain enterprise customers that are at that form a revenue concentration.

And as our focus is very much on the mid market, there has been always a risk that some of these will churn to more in house security operation centers and the tools around them. And that has happened with one very large enterprise customer in The U. K. During Q2. And with the earlier managed service churn and this one, our managed services part declined 22.

So this basically offset the good work in the Elements side and our ARR growth landed at 3%. And of course, that’s the single topic driving the NRR number. Tom will talk about the net revenue retention on Element Software and Managed Services separately in his part. And then like we announced, so we have reorganized I mean, the process of reorganizing our partner and customer facing activities to accelerate our strategy of becoming European flagship. And what we are doing here essentially is that we are focusing our sales and marketing efforts to a very globally aligned model where we have certain teams focusing on the mid market expansion and certain teams focusing on revenue retention and consolidation of the more long tail channel partner environment.

And so it’s very important for our strategy. And we could have done this earlier, but I think we have been quite busy with some of the other projects at the during first half. So we thought this would be the right time that we did it right after this transaction from Malaysia and Consulting. And we also align the cost structure in Managed Services to reflect the business reality, so that we commented on that one when we announced the reorganization program. So, Tom correct me if I’m wrong, these cost structure changes will have Q3 onwards impact, so that they don’t yet impact Q2 just for everybody to notice.

But despite investing in Sphere, despite this revenue churn from managed service, we managed to do adjusted EBITDA positive, which is a material difference from the previous year at the same time, if you remember that. So maybe with this one, I invite Tom as well to talk about how we are progressing with Cloud Protection.

Tom, CFO, WitSecure: Thank you very much and good afternoon from my part as well. So on the Cloud Protection for Salesforce, on a comparable note, we still are growing very strongly, so 54%. Of course, compared to previous quarter, this was a slower quarter for us and very back end loaded in many ways. But if you look commenting a little bit behind the numbers, we still won quite a few customers. But then unfortunately, we were also hit by a pretty large FX effect on CPSF because we have a fairly sizable operation in U.

S. So that had a negative impact on the ARR. And then there were some timings and so on. So, net together only a slight increase from the previous quarter, but still on track to do well on during this year. And of course, from this also then the NRR for CPSS was going a bit lower, it was still a very good number though, 122%.

But compared to the first quarter, it was slightly down. So as I said, the bit largest foreign exchange effect was from the dollars. Then we have quite a bit of Australian business as well and so on. So those would be impacted as well. Altogether, our ARR negative was about €400,000 So and but the numbers are in terms of customers are increasing quite well and so on as well.

Of course, the big thing is that as many of you who follow Salesforce know, they are pushing very hard the agent force and the AI tool applications on that. So we have also now part of that, we are in the forefront of protecting that activity. So agent force will be also protected by a new app by sales force during very soon. And we see that as a of course a great expansion to the sales force opportunity itself. And at the same time, to remind you everybody that, as we have said, CPSF, we continue to develop it.

And then we will see in the future what strategic options we will look at that. But we have a very good track phase at the moment going and we have patience to continue to develop it. But then maybe going to the numbers a little bit. So here you can see the Cloud ARR for the Elements company and the development of that. So elements, software and core security growing 13%.

So quite solid growth continues and good traction there and so on. And of course, the NRR and so on are also on a quite good level for this part of the business. As Antti already mentioned then on the managed services, we see a decline year over year in the ’22 over 20%. And this is because of the large as said, large enterprises going into their own way forward and not based on the mid market offering that we are providing. And this is particularly for The U.

K. And has been there already for some quarters. Then another picture. So our Cloud ARR grew three percent and the combined NRR net revenue retention was 99%. Of course, the software part was quite higher, but then the net was driven down by the managed services.

The on premise revenue declined. This is very much as planned and expected. And we continue to see that in this way as well, but for some time in the future. But this was no real big news for those who have been following us. From a profitability point of view, as said, we did a positive result despite our as always, our Q2 for past years has been a big investment in marketing and the Sphere event.

But despite that, then we were on a positive result in Q2. And here, again, the CPSF numbers, cloud protection sales force numbers. Strong ARR growth continues, some foreign exchange impact from that and the NRR at 122. And the revenue, of course, follows the ARR, so good progress on the revenue side as well as expected when the ARR also goes well. From a profitability point of view, as we have said before and continue, we are not expecting this or we don’t want to do to do profit at this stage.

We want to invest everything we generate to further growth. So this business will be breakeven approximately breakeven and has been so in the past as well. And we will continue to invest in growth as much as we can in terms of not though harming the overall cash flow for the company. Then here is the combined numbers for us. So 3% revenue increase in the quarter.

And our OpEx continues to reduce. And this is, of course, part of our efficiency measures that we have done before. And we, of course, do this continuously. And we’ve done some investments in sales and marketing to new customers and partners though. And of course, in R and D, we continue to optimize our cloud environments and so on.

And G and A, as we have also said, we expect that to scale with the business and we keep that under control. So we have a very diligent continuous efficiency measures in place and continue to watch our spend and try to improve on the efficiency. And then, of course, as Antti mentioned in the beginning, the newly launched restructuring that will have also an impact on our cost structure in the future. So at the moment, we are estimating that to reduce our structure annually, about €6,500,000 on an annual basis, cost in the future. And those will come gradually Q3, Q4 and into our numbers.

Then on our outlook, no change to the outlook. So we’re going into all of our businesses with a good pipeline for the second half and there’s no need to change our guidance. And we expect the ARR to grow for elements for 10% to 20% this year. And then for the CPSF, we are our outlook is to grow 20% to 35%. And then on the profitability for Elements Company, we expect EBITDA to be between 37% of our revenue.

With that, I will invite back and this is just maybe to recap then, we are determined to hold on to our medium term financial targets and be a rule of third plus company in a couple of years’ time. But with that, now I invite back Laura, and then we can go to the Q and A section.

Laura Witta, Investor Relations Director, WitSecure: All right. So we will start with the questions from the room, please.

Felix Hendrickson, Analyst, Nordea: Felix Hendrickson from Nordea. Have a few questions. Starting off with Managed Services. Was the decline and the magnitude of the decline in Q2 sort of in line with what you had budgeted into your guidance? And should we expect the pace of the decline to remain broadly similar for the second half of year as well?

Antti Koskela, President and CEO, WitSecure: We

Tom, CFO, WitSecure: as we mentioned before, we were always aware of potential large customer enterprise risks in here. So we have taken that into account. And as said, we are holding our guidance for the rest of the year.

Antti Koskela, President and CEO, WitSecure: And the growth model really happens through the meat market and the partners. And that’s where I think we have a belief on the partner momentum. So we have been singling that also to you in this call and previous calls. And I think we have a very healthy funnel for Elements Company also that, of course, we need to do a lot of work to, of course, get everything over the finish line, but I think pipeline is there.

Felix Hendrickson, Analyst, Nordea: Got it. Because I guess what I’m trying to get to is that do you expect the sort of headwind from the managed services decline to diminish or intensify in the second half of the year? Because that also impacts how much you need to close the Yes. Software That

Antti Koskela, President and CEO, WitSecure: is correct. Fully understood. Fully understood.

Felix Hendrickson, Analyst, Nordea: Got it. Regarding the sort of software and co security part of your Elements Cloud business, can you sort of describe the pipeline a bit more in detail? Is this mainly related to the new partners that you’ve signed? Sort of what gives you the confidence to get to the guidance? And could you just describe your visibility a bit more?

Antti Koskela, President and CEO, WitSecure: I think the key topic is that there’s a wide understanding is that you don’t do modern cybersecurity with end protection only endpoint protection only so that we see increasing trend that existing partners and customers are upgrading to other modules. But I think the more interesting partners are the partners, for instance, Reliance in Netherlands and who basically sell as a managed service security by themselves and we are white labeling and they sell it at the same time to their entire fleet, so that we don’t sell to individual end customers one by one, but we’re also able to package it to the partner and upgrade the entire fleet as well so that those give confidence that this opportunity can be turned.

Felix Hendrickson, Analyst, Nordea: Got it. And then lastly, you mentioned the €6,500,000 savings target related to the new change negotiations. Is that a net savings number? Or do you expect to invest part of that reinvest part of that into the business?

Antti Koskela, President and CEO, WitSecure: That is net saving.

Tom, CFO, WitSecure: Yes, that’s a net saving.

Felix Hendrickson, Analyst, Nordea: Got it. Very clear.

Antti Koskela, President and CEO, WitSecure: And we have underneath the number, we have, of course, reinvestment. But the key thing is here is that we are departing from a quite independent regional sales structure into globally aligned one, where we have team focused on the mid market and teams focused on the small to medium sized smaller part smaller customers and partners serving them. They require different mode of operation. And this is what we have in the plans because we have not finalized consultation in every country.

Walter Rozzi, Analyst, Danske Bank: Walter Rozzi from Danske Bank. About the planned cost cuts, how much would you say it’s coming from a structural change in your business model switching from the large customers in the mid market? In other words, is it more of a response to the lower demand in large customers or a proactive shift in line with your strategy?

Antti Koskela, President and CEO, WitSecure: This is 100% aligned with our strategy. And there’s so much as a leadership team we can do at the same time. So you might have noticed that we have been busy with consulting transaction and the Malaysian transaction. So we finalized those May. And then we could start getting to our plan and which we announced then in June.

So that we took thirty days. I think that’s pretty decent for that one. But this has been always the plan. If you remember for Investor Day, so the key thing is that we focus on the partners serving the mid market, managed service providers, kind of IT managed service providers. And that’s a scaling effect and they have access to the mid market.

Then we have a lot of channel partners from with secure history. Those we are consolidating largely under distributors like we have done with the likes of F9 in Finland, Ingram Micro and InfiniGate. And we continue to do so. Another I guess the efficiencies come two ways, so that partly is adjusting the cost structure to the managed services business reality, but big part comes from that actually us resourcing for the strategy and then there are synergies consequently from that one.

Walter Rozzi, Analyst, Danske Bank: All right. Thank you. Then also about the MDR decline. You mentioned that there was one large customer that partially churned. Can you specify what that means?

And do you expect the same client still to continue churning?

Tom, CFO, WitSecure: There is, of course, also some part that potentially churns in the future. But then that has been taken into account in our forecast. And this was a significant part

Antti Koskela, President and CEO, WitSecure: significant part from our single customer that happened in Q2.

Walter Rozzi, Analyst, Danske Bank: All right. Thank you. Then still a few questions. You also say that the FX impact was a big reason why the cloud protection for Salesforce growth was quite slow in Q2. Can you give at least a ballpark number on what the FX neutral growth was this quarter in that segment?

Tom, CFO, WitSecure: We did we announce the number there in our

Antti Koskela, President and CEO, WitSecure: So you said in the you said 800,000.

Tom, CFO, WitSecure: So that’s about the FX effect that what we were

Laura Witta, Investor Relations Director, WitSecure: Of ARR.

Tom, CFO, WitSecure: Of ARR. ARR. So without that, of course, it would have been higher that amount.

Walter Rozzi, Analyst, Danske Bank: So just explain once more, dollars 400 ks

Tom, CFO, WitSecure: ARR. Our ARR reduced to 400 compared to Q1 because of FX.

Walter Rozzi, Analyst, Danske Bank: All right. All right. Thank you. Got it. Then you also say that the discussion around the digital sovereign entity accelerated in Europe this quarter.

Do you expect this to actually materialize in increased demand still this year?

Antti Koskela, President and CEO, WitSecure: We already see increased demand from the partners, and that’s why companies like DNA in Finland are launching with us. You saw the release June 12. So we are launching with DNA to bring a European and Finnish alternative to the Finnish market from the telco. I think that’s a big step forward. And I think we have been doing quite groundbreaking work in Netherlands.

You have heard activity in our Investor Day. We have a big client talking publicly, Reliance. Reliance is a family office that has acquired seven managed service providers into the group. They are standardizing on WidSecure and upgrading that to the entire fleet. And we see more partners like this coming, so that this gives me the confidence.

Walter Rozzi, Analyst, Danske Bank: All right. Thank you. One last one related to the cost savings. You said that from Q3 onwards, it will benefit your margins gradually. But how much will it actually benefit this year’s results?

Tom, CFO, WitSecure: As we said, it will be SEK 6,500,000.0 net saving on annual basis. I would say that a large portion of that probably, depending on how now the process goes, of course, will start to come into play in from at some point in Q4 and onwards.

Walter Rozzi, Analyst, Danske Bank: All right. Thank you.

Atri Riegler, Analyst, Inderes: It’s Atri Riegler from Inderes. Maybe first now about the changed negotiations. Do

Antti Koskela, President and CEO, WitSecure: you

Atri Riegler, Analyst, Inderes: have any estimate how much nonrecurring items is going to come from those in Q3?

Tom, CFO, WitSecure: We will launch we will tell when we are done with the processes.

Atri Riegler, Analyst, Inderes: And then still about the ARR guidance. Now you seem like you have confidence that ARR growth will pick up in the H2, but should we already see some improvement in Q3? Do we already have the pipeline that now in Q3 there’s going to

Antti Koskela, President and CEO, WitSecure: be improvement? Absolutely. We need to increase the tempo in Q3 and definitely in Q4, but I expect this to be quite back end loaded any which way like our business usually is.

Atri Riegler, Analyst, Inderes: So it’s again Q4 when we’re going to see what’s going to happen. Maybe still about that, it’s if you calculate, you have to like get in like seven roughly like €7,000,000 ARR to get it like in the lower end of So your and if there’s still going to be some churn from the managed services. So it sounds like a lot compared to your history. So what gives the confidence still on the now?

Antti Koskela, President and CEO, WitSecure: I think I guess it’s important to understand is that when just the reason why I mentioned this Reliance example is that when you sell into a partner that is managed service provider, you are not they are not actually selling the technology to their end customers because they are providing a service. They switch on the technology and we get the full benefit quite quickly. And I think that gives me the confidence on that one. But there’s a lot to do. I think it’s that funnel supports it and the funnel supports it and there’s no reason to be pessimistic about it.

So that would be guesswork.

Atri Riegler, Analyst, Inderes: Can you say anything about what kind of numbers we are talking about if that kind of MSSP partner takes your technology and takes it to all of its clients?

Antti Koskela, President and CEO, WitSecure: Better not to comment, think you said. But I think we have said we shared in the Investor Day about the opportunity that how the if you move from EPP to wider. Did we share that one?

Tom, CFO, WitSecure: Yes. Mean, if it yes. So, it’s of course multiple x.

Antti Koskela, President and CEO, WitSecure: It’s like 12x endpoint protection easily seat.

Atri Riegler, Analyst, Inderes: And you already mentioned that there is like growing interest towards European cybersecurity vendors. But is it now only seen from the partner perspective? Because now, of course, the ARR growth wasn’t that fast in Q2, so

Antti Koskela, President and CEO, WitSecure: I think it’s fair it is true because our business model is about we sell into the partners, then we get the multiplication effect. We are not selling into the end user. We are selling into the partner. And together with partners, we then sell into the customer. So it’s a that’s why this progress in setting up the partnerships, that’s the foundational work that is so critical.

Atri Riegler, Analyst, Inderes: And if you look at the competitive landscape in Europe, has there been any changes in this year?

Antti Koskela, President and CEO, WitSecure: This has been the biggest change, this digital sovereignty. I think I have seen RFQs where only European vendors are eligible. And so that we have three main contenders in business, EZ, Bitdefender and WidSecure in Europe. And but we start to see those kind of trends. Denmark has taken very drastic actions to remove U.

S.-based technologies. I think they are removing Office three sixty five and moving to open source systems, and they are doing systematic actions. So that this is a big undercurrent and it will not happen overnight, but it’s a big undercurrent. And it’s a part of the European defense as well. So if you look at this NATO spending, 5%, this 1.5%.

Cyber is part of the 1.5% and the sovereignty part there.

Atri Riegler, Analyst, Inderes: All right. Thank you.

Laura Witta, Investor Relations Director, WitSecure: All right. One more question from the room.

Felix Hendrickson, Analyst, Nordea: Yes. Just a couple of housekeeping items. Just on working capital, there was quite a meaningful release in the quarter. So could you explain that a bit? Was that something structural?

Or is that something that will reverse in the back half of the year?

Tom, CFO, WitSecure: That has probably mostly related to when we did the consulting divestment and so on. So that had a big impact on the numbers as well.

Felix Hendrickson, Analyst, Nordea: Okay. And then just another one related to Sphere. I think you disclosed last year that the cost related to the event was roughly €1,200,000 Can you disclose how much it was this year?

Antti Koskela, President and CEO, WitSecure: €750,000 It was in Tom’s slide, so that we had a significantly lower spend on that one. We had a very focused session for the right audience, customers and partners, less of an industry event.

Felix Hendrickson, Analyst, Nordea: Thank you.

Laura Witta, Investor Relations Director, WitSecure: All right. Thank you. I’m moving to the questions from the chat. And Jako, our analyst, is online today and asks, given the talk around digital sovereignty in Europe, are you seeing especially good opportunities in the European public sector? You touched on it already, but maybe let’s Yes.

Antti Koskela, President and CEO, WitSecure: Think that’s definitely an upside for us is the public sector, and there are increasing items on that one so that, of course, there’s a whole notion how we as a nation support Ukraine. I think that’s a big part of the opportunity and so forth. All

Laura Witta, Investor Relations Director, WitSecure: right. Then again from Jakob. After the churn of the large client in managed services in Q2, could you comment the remaining at risk customers in the managed services portfolio?

Tom, CFO, WitSecure: Of course. Unfortunately, when these churn things happen, the risk reduces somewhat. And as Antti said, there is also a part of managed services actually, which is growing. It just doesn’t come true when large customers are number

Antti Koskela, President and CEO, WitSecure: of end customers in managed services is higher in this quarter

Tom, CFO, WitSecure: than it was So in this I guess the answer is that once the churn happen, the risk reduces.

Antti Koskela, President and CEO, WitSecure: Absolutely.

Laura Witta, Investor Relations Director, WitSecure: All right. Then there’s Jako and member of the audience who both asked about the cloud ARR guidance. We talked about it already, but let’s talk about it once more. So the guidance implies rather steep acceleration in the second quarter. What gives you the confidence for such a change in the trading?

Antti Koskela, President and CEO, WitSecure: So the work we have done with the partners in the first half and the quality of the partnerships and of course having access to our sales funnel. And I think sales funnel is the basis of our ARR guidance.

Laura Witta, Investor Relations Director, WitSecure: All right. And actually, it looks like people are on their holiday because there’s no more questions in the chat.

Antti Koskela, President and CEO, WitSecure: Yeah. Is there

if I still comment, I think this ARR topic is that it is really about that we have a good funnel, we have good partners. I think now us to prove and execute on that one. I I think that’s what we need to do. And it’s a that’s why we put the focused operational model as well in place for sales that we are able to capture these opportunities.

Laura Witta, Investor Relations Director, WitSecure: Thank you, Antti, for recapping. Any questions in the room? None in the chat either. So I think we are ready to wrap up and go back to the sunny city. So thanks for being with us today, and have a nice summer.

And thanks for following us in the future as well. Bye bye.

Antti Koskela, President and CEO, WitSecure: And thank you for and happy holidays from my part.

Tom, CFO, WitSecure: Thank you very much.

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