Nagarro Reports Q2 2025 Financials and Resilient Revenue Growth Amid Economic Challenges

Nagarro's Q2 2025 Financial Performance

Nagarro, a prominent global leader in digital engineering, has recently disclosed its unaudited financial results for the second quarter of 2025. The report shows that the company experienced a year-over-year revenue growth of 4.7% in constant currency, translating to €252.0 million compared to €244.1 million in Q2 2024. This growth trajectory underscores Nagarro's strategic adaptability amid ongoing global macroeconomic challenges.

Key Financial Highlights

In the context of currency fluctuations, Nagarro's performance metrics reflect operational strength despite external pressures. Gross profit saw a notable increase, rising to €83.7 million in Q2 2025, which represents a 14.2% improvement year-over-year. The gross margin improved to 33.2%, a significant increase from 30.0% in the same quarter last year, affirming the company's ability to enhance profitability in a competitive environment.

For the first half of 2025, Nagarro's revenue reached €498.9 million, up 3.4% from €482.4 million during the same period in 2024. The gross profit for H1 2025 was €159.3 million, marking an 8.4% increase year-over-year, with a gross margin of 31.9%.

Adjusted EBITDA for Q2 2025 was reported at €30.5 million, or 12.1% of revenue, reflecting a decline compared to €35.5 million (14.5% of revenue) reported in Q2 2024. This decrease is primarily attributed to revaluation losses on inter-company loans and cash holdings due to the depreciation of the US dollar against the Euro, which significantly impacted the company's financials, resulting in a negative €18 million adjustment for the first half of the year.

Despite these setbacks, Nagarro succeeded in maintaining strong operational performance. However, net profits were adversely affected, falling to €8.3 million during the quarter, down from €12 million in Q2 2024. This decline is largely due to increased income tax expenses related to withholding taxes on inter-company dividends.

Strategic Outlook

In light of these results, Nagarro is adjusting its revenue guidance for 2025, anticipating a performance closer to the lower end of its previously projected range of €1,020 to €1,080 million. With a continued focus on gross margin stability around 30%, the company aims to navigate these financially challenging waters while targeting an Adjusted EBITDA margin between 13.5% and 14.5%.

The company attributes its long-term viability and market position to innovative strategies and a committed workforce, employing approximately 17,447 professionals globally as of June 30, 2025.

Conclusion

Nagarro's Q2 2025 financial outcomes illustrate resilience and growth amid a turbulent economic landscape. The company's proactive approach to managing operational efficiencies will be crucial as it moves forward, adapting to ongoing fiscal changes and striving for enhanced profitability. Stakeholders and investors will be keenly awaiting the forthcoming analyst and investor calls, providing insights into Nagarro's trajectory and strategic initiatives.