Nagarro releases unaudited Q2 2025 results, posts 4.7% YoY revenue growth in constant currency and 14.2% increase in gross profit despite global macroeconomic challenges

Rhea-AI Summary

Nagarro (OTC:NGRRF) released its Q2 2025 financial results, reporting revenue growth of 3.2% YoY to €252.0 million, with constant currency growth of 4.7%. The company achieved notable improvements in gross profit, which increased 14.2% YoY to €83.7 million, with gross margin expanding to 33.2% from 30.0% in Q2 2024.

However, Adjusted EBITDA was significantly impacted by currency effects, declining to €30.5 million (12.1% margin) from €35.5 million (14.5% margin) in Q2 2024. Net profit decreased to €8.3 million from €12.0 million YoY. The company declared a dividend of €1.00 per share and updated its 2025 guidance, expecting revenue near the lower end of €1,020-€1,080 million range and Adjusted EBITDA margin between 13.5-14.5%.

Positive

• Gross profit increased 14.2% YoY to €83.7 million with improved margin of 33.2%
• Revenue grew 4.7% YoY in constant currency to €252.0 million
• Number of €1M+ clients increased from 184 to 188
• Days of sales outstanding improved from 88 to 85 days
• Declared dividend of €1.00 per share

Negative

• Adjusted EBITDA margin declined to 12.1% from 14.5% YoY due to currency impacts
• Net profit decreased 30.8% YoY to €8.3 million
• Currency revaluation and forex transactions had €18.0 million negative impact on Adjusted EBITDA
• Lowered revenue guidance to lower end of €1,020-€1,080 million range
• Reduced Adjusted EBITDA margin guidance to 13.5-14.5% from previous 14.5-15.5%

MUNICH, Aug. 14, 2025 /PRNewswire/ -- Nagarro, a global digital engineering leader, today presented its unaudited financial numbers for Q2 2025 and released its half-yearly financial report. 

In Q2 2025, revenue grew to €252.0 million, up 3.2% YoY from €244.1 million in Q2 2024. Constant currency YoY revenue growth for Q2 2025 was 4.7%. Organic YoY revenue growth for the quarter was 3.8% in constant currency, which translated to 2.4% organic YoY revenue growth in Euro terms. Gross profit grew to €83.7 million in Q2 2025 from €73.3 million in Q2 2024. Gross margin was 33.2% in Q2 2025, against 30.0% in Q2 2024.

Despite excellent operational efficiency in Q1 and Q2 2025, Adjusted EBITDA was significantly impacted by the revaluation loss on inter-company loans from Nagarro SE and its cash holdings due to the weakening of the US dollar against the Euro. Across Q1 and Q2 2025, the total impact on Adjusted EBITDA of currency revaluation plus foreign exchange forward transactions was a negative €18.0 million.

Consequently, Adjusted EBITDA for Q2 2025 was €30.5 million (12.1% of revenue), against €35.5 million (14.5% of revenue) in Q2 2024. EBITDA declined to €32.0 million in Q2 2025, from €32.8 million in Q2 2024. EBIT grew marginally to €23.4 million in Q2 2025, from €23.1 million in Q2 2024. Net profit declined to €8.3 million in Q2 2025 against €12.0 million in Q2 2024 mainly due to increase in income tax expense on account of withholding taxes on inter-company dividends remitted by downstream subsidiaries to their immediate holding companies. The number of clients doing more than €1 million in annual revenue in the last 12 months with Nagarro rose from 184 on June 30, 2024 to 188 on June 30, 2025.

A dividend of €1.00 per share amounting to €12.6 million (13.1% of 2024 EBIT) has been declared during the Annual General Meeting held on June 30, 2025.

H1 results

Revenue grew to €498.9 million in H1 2025, up 3.4% YoY from €482.4 million in H1 2024. Constant currency revenue growth for H1 2025 was 3.6%. Organic YoY revenue growth for H1 2025 was 2.8% in constant currency, which translated to 2.6% organic YoY revenue growth in Euro terms. Gross profit grew to €159.3 million in H1 2025 from €146.9 million in H1 2024. Gross margin was 31.9% in H1 2025, against 30.5% in H1 2024.

Adjusted EBITDA was €60.8 million (12.2% of revenue) in H1 2025, against €74.7 million (15.5% of revenue) in H1 2024. EBITDA declined to €65.0 million in H1 2025 from €68.8 million in H1 2024. EBIT declined to €47.5 million in H1 2025 from €49.7 million in H1 2024. Net profit declined to €19.6 million in H1 2025 against €28.6 million in H1 2024 mainly due to increase in income tax expense on account of withholding taxes on inter-company dividends remitted by downstream subsidiaries to their immediate holding companies.

Operating cash inflow in H1 2025 declined to €26.1 million from €27.6 million in H1 2024, even while factoring utilization under the non-recourse factoring program was reduced by €8.5 million in H1 2025 from December 31, 2024. Days of sales outstanding, calculated based on the quarterly revenue and including both contract assets and trade receivables, has improved from 88 days on December 31, 2024 to 85 days on June 30, 2025.

Nagarro's cash balance at the end of June 30, 2025 was €121.8 million as against €192.6 million at the end of December 31, 2024. Nagarro's loans and borrowings at the end of June 30, 2025, were €300.7 million as against €329.6 million at the end of December 31, 2024. The company reported 17,447 professionals as of June 30, 2025.

The summarized table for the three-months period ended June 30, 2025 is as follows:

		Q2 2025		Q2 2024		Growth
		mEUR		mEUR
Revenue		252.0		244.1		3.2% YoY 4.7% YoY in constant currency
Gross profit		83.7		73.3		14.2% YoY
Gross margin		33.2 %		30.0 %
Adjusted EBITDA		30.5		35.5		Negative 14.1% YoY
Adjusted EBITDA margin		12.1 %		14.5 %
EBITDA		32.0		32.8		Negative 2.4% YoY
EBIT		23.4		23.1		1.3% YoY
Net profit		8.3		12.0		Negative 30.8% YoY

The summarized table for the six-months period ended June 30, 2025 is as follows:

		H1 2025		H1 2024		Growth
		mEUR		mEUR
Revenue		498.9		482.4		3.4% YoY 3.6% YoY in constant currency
Gross profit		159.3		146.9		8.4% YoY
Gross margin		31.9 %		30.5 %
Adjusted EBITDA		60.8		74.7		Negative 18.6% YoY
Adjusted EBITDA margin		12.2 %		15.5 %
EBITDA		65.0		68.8		Negative 5.5% YoY
EBIT		47.5		49.7		Negative 4.4% YoY
Net profit		19.6		28.6		Negative 31.5% YoY

Supervisory Board committees

The committees of Nagarro's Supervisory Board have been freshly reconstituted. Martin Enderle, Chair of the Supervisory Board, is also the Chair of the Nomination & Remuneration Committee. Until recently he was Chair of the Supervisory Board of Delivery Hero. Hans-Paul Buerkner, who was previously global CEO and Chairman of BCG, is the Chair of the Strategy Committee. Jack Clemons, who was global CEO of Bata and has been on various other boards, including being Chair of the Audit and Risk Committee of the Worldwide Fund for Nature (WWF), is Chair of the Audit Committee.

Update on guidance

On January 23, 2025, we had projected Nagarro's revenue for 2025 to be between €1,020 and €1,080 million, when calculated at the currency exchange rates then prevailing. We now expect Nagarro's revenue for 2025 to come near the lower end of that guidance. We targeted gross margin in the region of 30%, as compared to 30.4% in 2024. We hold to this expectation of gross margin. We targeted the Adjusted EBITDA margin to be between 14.5% and 15.5%, compared to 15.2% in 2024. Despite strong underlying operational performance of the company, the revaluation loss on inter-company loans and cash holdings because of the weakening of the US dollar against the Euro is currently expected to lead the Adjusted EBITDA margin to be between 13.5% and 14.5%.

Nagarro SE will hold its analyst and investors meeting as a video call to discuss the half-yearly financial report 2025 on August 14, 2025, 1:00 pm CEST (4:00 am PT / 6:00 am CT / 7:00 am ET / 12:00 pm BST / 3:00 pm GST / 4:30 pm IST / 7:00 pm SGT / 8:00 pm JST).

Nagarro SE will hold its retail investors call to discuss the half-yearly financial report 2025 on August 14, 2025, at 2:30 pm CEST (5:30 am PT / 7:30 am CT / 8:30 am ET / 1:30 pm BST / 4:30 pm GST / 6:00 pm IST / 8:30 pm SGT / 9:30 pm JST).

To attend, please register in advance at https://www.nagarro.com/en/investor-relations/half-yearly-q2-statements-call-2025.

About Nagarro

Nagarro, a global digital engineering leader, helps clients become fluidic, innovative, digital-first companies and thus win in their markets. The company is distinguished by its entrepreneurial, agile, and global character, its CARING mindset, and its Fluidic Enterprise vision. Nagarro employs around 17,400 people in 39 countries.

For more information, visit www.nagarro.com.

(FRA: NA9) (SDAX/TecDAX: DE000A3H2200) (ISIN: DE000A3H2200) (WKN: A3H220) 

For inquiries, please contact press@nagarro.com.

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FAQ

What were Nagarro's (NGRRF) Q2 2025 revenue and growth rates?

Nagarro reported Q2 2025 revenue of €252.0 million, representing 3.2% YoY growth in reported terms and 4.7% growth in constant currency. Organic revenue growth was 3.8% in constant currency.

How did currency fluctuations impact Nagarro's Q2 2025 results?

Currency fluctuations, particularly USD weakening against EUR, resulted in a negative €18.0 million impact on Adjusted EBITDA through revaluation losses on inter-company loans and cash holdings in H1 2025.

What is Nagarro's updated guidance for fiscal year 2025?

Nagarro expects 2025 revenue near the lower end of €1,020-€1,080 million range, maintains gross margin target around 30%, and revised Adjusted EBITDA margin guidance to 13.5-14.5% due to currency impacts.

How much dividend did Nagarro declare in 2025?

Nagarro declared a dividend of €1.00 per share, totaling €12.6 million, which represents 13.1% of 2024 EBIT.

What was Nagarro's profitability in Q2 2025?

Nagarro reported Q2 2025 gross profit of €83.7 million (33.2% margin), Adjusted EBITDA of €30.5 million (12.1% margin), and net profit of €8.3 million.