Following the recent announcements by the U.S. administration regarding tariffs, GN now takes further actions to counter the negative direct and indirect effects from the increased tariff levels. With the actions, GN is capable of mitigating the majority of the assumed tariff impact on the EBITA margin in 2025 as well as protecting its mid-term earnings growth.
The development in tariffs and its impact on our markets makes our environment more uncertain than normal. As a base assumption for our revised financial guidance we assume that tariff rates and exemptions as of today are constant throughout the remainder of the year and that we will see some slowdown in the Enterprise and Gaming markets, reflecting the elevated uncertainty.
In recent years, GN has proactively diversified its manufacturing footprint across the Enterprise and Gaming divisions to ensure flexibility and agility in its global supply chain. To further react to a fast-changing trade environment GN takes the following actions:
Acceleration of the diversification of its manufacturing footprint. The accelerated timeline will allow GN to service the vast majority of the U.S. market with manufacturing outside of China by the end of 2025
Implementation of price increases for U.S. customers across Enterprise and Gaming
Implementation of cost and cash flow initiatives to protect group financials
With the above initiatives, GN expects to mitigate a significant part of the tariff impacts. We continuously assess the development and additional mitigating actions will be taken as needed.
The direct and indirect impact from the increased level of tariffs - which are partly offset by the mitigation actions - are leading to the following financial guidance for 2025:
Financial guidance for 2025
Organic revenue growth excl. wind-down
EBITA margin
Free cash flow excl. M&A (DKK million)
Updated
Prior
Updated
Prior
Confirmed
Prior
-3% to +3%
3% to 7%
11% to 13%
12% to 14%
~800
~800
Key revenue assumptions for the financial guidance of 2025
Hearing division In 2025, GN expects the hearing aid markets to grow in line with the historical growth rates supported by ongoing favorable demographic trends. As such, GN projects 4-6% market volume growth and -1% market ASP decline, equaling a market value growth of 3-5%. Based on the attractive market fundamentals, the current sales momentum, as well as the launch of ReSound Vivia and ReSound Savi, GN expects to continue to gain market share in 2025. Consequently, the Hearing division assumes to contribute with organic revenue growth of 5% to 9%.
Enterprise division Following a longer period of market stabilization, the current market environment creates uncertainty that makes companies postpone certain IT projects - including peripherals categories. As a consequence, GN assumes a negative impact on the addressable market for the remainder of the year. In addition, GN will make a prioritization of product variants shipped to the U.S., until the supply chain diversification is concluded, which is expected to temporary impact revenue negatively. The end customers are expected to experience limited disruption due to currently available channel inventory. Consequently, the Enterprise division assumes to contribute with organic revenue growth of -8% to 0%.
Gaming division Due to the recent sharp decline in consumer sentiment in the U.S. as well as the general uncertainty in the global economy, GN expects its gaming gear market to be negatively impacted. In addition, GN will make a prioritization of product variants offered to its U.S. customers, until the supply chain diversification is concluded, which is expected to temporary impact revenue in the short-term. Consequently, the Gaming division assumes to contribute with organic revenue growth of -6% to +2% (excluding the impact from the wind-down).
GN expects to publish its Q1 2025 interim report later tonight.
For further information, please contact:
Investor Relations Rune Sandager +45 45 75 92 57
Media Relations Steen Frentz Laursen +45 20 65 34 20
Forward-looking statements The forward-looking statements in this report reflect the management's current expectations of certain future events and financial results. Statements regarding the future are, naturally, subject to risks and uncertainties, which may result in considerable deviations from the outlook set forth. Furthermore, some of these expectations are based on assumptions regarding future events, which may prove incorrect. Changes to such expectations and assumptions will not be disclosed on an ongoing basis, unless required pursuant to general disclosure obligations to which GN is subject.
Factors that may cause actual results to deviate materially from expectations include – but are not limited to – general economic developments and developments in the financial markets as well as foreign exchange rates, technological developments, changes and amendments to legislation and regulations governing GN’s markets, changes in the demand for GN's products, competition, fluctuations in sub-contractor supplies, and developments in ongoing litigation (including but not limited to class action and patent infringement litigation in the United States).
For more information, please see the "Management's report" and "Risk management” sections in the Annual Report. This announcement should not be considered an offer to sell or buy securities in GN.
About GN GN facilitates communication between people through intelligent hearing, audio, video, and gaming technology. Inspired by people and driven by our passion for innovation, we leverage technologies to deliver unique user experiences that bring people closer through the power of sound and vision.
GN was founded more than 150 years ago with a vision to connect the world. Today, we proudly honor that legacy with our world-leading expertise in the human ear, audio, video and speech, wireless technologies, software, miniaturization, and collaboration with leading technology partners. GN's solutions are marketed by the brands ReSound, SteelSeries, Jabra, Beltone, Interton, BlueParrott, Danavox and FalCom in 100 countries. Founded in 1869, the GN Group employs 7,000 people and is listed on Nasdaq Copenhagen (GN.CO).
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