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Nagarro's Financial Overview: FY 2024 and Q1 2025

Nagarro, the world-renowned leader in digital engineering, recently unveiled its audited financial results for the fiscal year ending December 31, 2024, along with its unaudited financial figures for the first quarter of 2025. With a solid foundation and optimistic outlook, the company's executives are poised to guide it further into new territory.

Highlights from FY 2024

The total revenue for Nagarro increased to €972 million, marking a growth of 6.6% from the previous year’s €912.1 million. When adjusting for constant currency, the growth rate reached 7.2%, showcasing robust performance globally. The gross profit followed suit, climbing to €295.8 million according to the current method - a significant increase compared to €235.7 million from the previous year. The gross margin remained strong at 30.4% for FY 2024.

The company also witnessed impressive improvements in its adjusted EBITDA, which rose to €147.5 million, up from €126.1 million in 2023. This reflects a margin increase to 15.2% compared to 13.8% from the previous year. Other notable metrics include:

• - EBITDA climbed to €134.1 million
• - EBIT rose to €96.7 million
• - Despite overall growth, the net profit remained stable at €49.2 million, sustaining the level achieved in FY 2023.

Interestingly, Nagarro saw an increase in its client base, with the number of clients generating over €1 million annually increasing from 181 to 186 within the same timeframe.

From a cash flow perspective, the operational cash flow rose to €86.5 million, compared to €79.7 million the year prior, indicating solid financial management. Although the company's cash balance at year-end stood at €192.6 million—up from €110.1 million in 2023—its debt levels also increased from €274.7 million to €329.6 million, reflecting strategic investments in growth initiatives.

Developments for Q1 2025

For the first quarter of 2025, Nagarro’s revenue grew to €246.9 million, a 3.6% year-on-year increase from €238.3 million in Q1 2024. Gross profit for this period reached €75.5 million, while the adjusted EBITDA was reported at €30.2 million, down from €39.2 million the previous year, showcasing transitional challenges as the company adjusts to new market dynamics.

The net profit dropped to €11.2 million compared to €16.6 million a year earlier, partly due to rising operational costs and shifts in business focus. Meanwhile, the operational cash flow also saw an increase to €29.8 million, reflecting a proactive approach to liquidity management.

Nagarro remains committed to enhancing its governance structure and plans to propose an expansion of its Supervisory Board, introducing candidates with diverse expertise in finance and digital transformation.

Looking Ahead

Manas Human, the co-founder of Nagarro, expressed satisfaction over the company’s performance and reiterated confidence in their growth projections for 2025. He mentioned that several growth initiatives are currently underway, with expectations of substantial contributions to overall performance in the upcoming months. The company’s strategy includes the introduction of dividends, marking a significant step towards long-term value creation for shareholders.

As Nagarro navigates through this crucial phase, its commitment to staying at the forefront of digital engineering and continuously providing value to clients remains evident. Investors and clients alike can expect a transparent and engaging dialogue as the company prepares for its upcoming analyst and investor meetings scheduled for May 15, 2025.