Original-Research: Bittium Oyj (von NuWays AG): BUY

Classification of NuWays AG to Bittium Oyj

Company Name:	Bittium Oyj
ISIN:	FI0009007264
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 42
Target price on sight of:	12 months
Last rating change:
Analyst:	Julius Neittamo

Q2 review: Blow out sales and order intake; PT UP Bittium printed an exceptional Q2. Sales grew 60.1% yoy to € 36.6m (eNuW: € 27.2m, eCons: € 29.3m), a 25% beat vs consensus, on very strong Defense & Security (D&S) backlog conversion and product deliveries. D&S sales doubled yoy to € 28.7m (eNuW: € 19m, eCons: € 20.7m), 39% above consensus and the source of the entire group beat. Medical sales grew 3.2% yoy to € 4.9m (eNuW: € 4.8m, eCons: € 5.1m), while Engineering Services sales declined 14.5% yoy to € 3.3m (eNuW: € 3.4m, eCons: € 3.5m), due to a weak market and the reallocation of personnel to D&S projects. In addition to the very strong deliveries, the D&S order intake in Q2 was arguably more impressive at € 38.2m (Q2'25: € 20.0m), implying a book-to-bill of 1.33x even as deliveries doubled yoy. Group order backlog grew 137% yoy to a record € 102.2m, of which € 94.2m in D&S. Notably, part of the orders came from weapons manufacturers, an order source that has developed faster than we anticipated, adding a second demand channel alongside national procurement. The CEO named manufacturers of ground-based air defence systems as one such customer group, integrating Bittium's tactical communications into their platforms. The mix shift toward product sales drove outstanding profitability. EBITDA grew to € 10.1m (Q2'25: € 2.9m; eNuW: € 4.6m, eCons: € 6.4m), implying a 27.5% margin (+14.9pp yoy; eCons: 21.3%). EBIT came in at € 8.1m (Q2'25: € 1.1m; eNuW: € 2.6m, eCons: € 4.0m), more than double consensus, for a 22.2% margin (+17.3pp yoy), near our assumed structural run-rate level (~24%; eNuW). The margin step-up is above all a mix effect: product-based sales reached € 27.8m or 76.1% of group sales (+10.1pp yoy). The high-margin hardware contribution is most visible in D&S, where EBIT grew to € 8.8m (Q2'25: € 1.7m; eNuW: € 2.4m, eCons: € 3.9m) at a 30.6% margin (+18.8pp yoy; eCons: 18.4%). Bittium does not disclose how much Indra-related income was recognised in Q2, only noting that the cooperation is progressing according to plan. Nevertheless, Q2'26 was a high-quality beat, carried by the higher share of product sales and the resulting operating leverage (eNuW). Both rest on Bittium's early-mover lead in tactical communications, built on ~€ 200m invested over the past decade. FY26 guidance of € 140-155m sales and € 26-32m EBIT was confirmed. The board also resolved to pay an extraordinary dividend of € 0.15/share, increasing the FY25 distribution to € 0.30/share. The robust delivery execution and the even more impressive order intake increase our confidence in a strong finish to the year. Management reiterated its guidance for an H2 weighting, consistent with the seasonality of the past three years. We raise sales estimates for this and the coming years as we see Bittium increasingly gaining traction across customer groups and regions. In light of the above, we raise our PT to € 42 (old: € 40) and reiterate our BUY rating, based on our DCF model. You can download the research here: bittium-oyj-2026-08-10-previewreview-en-7a215 For additional information visit our website: https://www.nuways-ag.com/research Contact for questions: NuWays AG - Equity Research Web: www.nuways-ag.com Email: research@nuways-ag.com LinkedIn: https://www.linkedin.com/company/nuwaysag Adresse: Mittelweg 16-17, 20148 Hamburg, Germany ++++++++++ Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte. Offenlegung möglicher Interessenkonflikte nach § 85 WpHG beim oben analysierten Unternehmen befindet sich in der vollständigen Analyse. ++++++++++