Strong start into FY26; Guidance already upgraded

Group sales rose 11% yoy to € 51.4m (eNuW: € 51.9m), driven mainly by software (+13% yoy to € 38.3m). Once again, Cloud & Subscriptions accelerated significantly to € 27.0m (+27% yoy), now accounting for 53% of total sales (Q1 25: 46%), while license revenues continued their planned compression to just € 1.6m (-40% yoy), reflecting the ongoing successful migration of customers towards recurring cloud contracts. Together with maintenance, recurring revenues reached € 36.7m (+17% yoy), lifting the recurring share to 71%, reflecting a 3pp yoy improvement.

The cloud ARR trajectory remains the most important forward indicator. Cloud ARR grew 27% yoy to € 110m, supported by a net retention rate of 112% (+1pp yoy). The 12-month cloud order backlog rose 23% yoy to € 114m, while the total ARR backlog climbed 16% yoy to € 152.5m. New ACV came in at € 21.5m (flat yoy), with new logos accounting for ~50% of contracts signed. Healthcare is gaining additional traction as a vertical, contributing a significant share of new business. During the CC, management stated the flat ACV is in-line with budget and thus baked in the FY26 top-line guidance (c. € 215m). Should the current (macro-related) elongation of sales cycle ease, this could imply upside to the current outlook.

On profitability, EBIT reached € 18.2m, corresponding to a 35.3% margin (eNuW: € 17.9m), once more reflecting ATOSS' disciplined cost management and the operating leverage inherent in the SaaS model. A revaluation of the long-term incentive programme had a marginal accretive impact on the quarter. FCF surged 97% yoy to € 39.4m, reflecting front-loaded cloud billings and a normalisation of tax outflows vs. Q1 2025, which had been inflated by one-off back taxes. Liquidity reached € 162.1m, providing the company with ample strategic flexibility for further organic investments into AI or potential bolt-on acquisitions, while organic growth alone remains sufficient to drive value creation with ROICs well above 50%.

On AI, ATOSS targets two near-term deliverables: the agentic ATC assistant launching in Q2 2026 and thetwo new Agents for ASES, both due in Q4 2026. The latter allows workers to describe complex scheduling needs, even by voice, with the agent checking all applicable rules and surfacing compliant options autonomously. Strategically, AI is proving a pull-forward catalyst for cloud migration with early adoption trends across healthcare and retail suggesting the product roadmap is resonating with the installed base.

Management confirmed FY26 sales guidance of ~€ 215m and lifted the EBIT margin target to ≥34% (previously ≥32%), which we already flagged in previous notes and hence regard as reasonable given the strong start into the year.

Reiterate BUY with a new € 134 PT (old: € 148) based on DCF.