In This Article:
Highlights
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The Hearing division delivered -1% organic revenue growth driven by a strong initial uptake of ReSound Vivia, but off-set by a challenged U.S. market as well as some slowdown of existing products in anticipation of ReSound Vivia. The strong uptake of ReSound Vivia has continued into April, lending support for expected market share gains. As a consequence of the launch initiatives and the challenged U.S. market, the divisional profit margin ended at 28.4%.
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The Enterprise division was challenged in the quarter with -9% organic revenue growth due to a demanding comparison base from several large deals in Q1 2024 and the current global macroeconomic uncertainty. The sell-out growth was stronger at -5%. As a result of strong pricing discipline and cost focus, the divisional profit margin ended at 32.9%.
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The Gaming division experienced 11% organic revenue growth excluding the wind-down of the Talk and Elite product lines in a challenged gaming gear market – especially in the U.S. due to the sharp decline in consumer sentiment in the second half of the quarter. The divisional profit margin (excluding wind-down effects) ended at 12.9% supported by strong pricing discipline as well as one-company supply chain benefits.
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Group reported EBITA ended at DKK 300 million (EBITA margin of 8%), reflecting the negative operating leverage.
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Free cash flow excl. M&A ended at DKK -395 million driven by strong cost focus, but off-set by traditional seasonality on working capital, higher interest payments and timing of corporate tax payment. Net interest-bearing debt ended at DKK 10.1 billion, equal an adj. leverage of 4.1x.
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The direct impact from the recent escalation of tariffs was limited in the quarter. However, in order to protect future profits, significant actions are being executed: 1) Acceleration of diversification of manufacturing footprint, 2) U.S. price increases for Enterprise and Gaming and 3) Group-wide cost and cash initiatives.
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As a consequence of the direct and indirect tariff impact, group financial guidance is adjusted. GN now expects group organic revenue growth of -3% to +3%, an EBITA margin of 11% to 13%, and an unchanged free cash flow excl. M&A guidance of DKK ~800 million.
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 financial guidance 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%.