Unlikely to change current sentiment - Q3 initial

Overall, a somewhat light report from OssDsign with sales 3% below DCARe. We would expect low to mid-single digit negative revisions to consensus sales on the back of the numbers, and although the share price has been weak YTD, we struggle to see the Q3 report changing sentiment and expect a negative reaction in mid-single digits on the day.

Q3 results. Sales were ~SEK36m, 3% below our forecast, and down ~20% organically Y/Y and -8% Q/Q in USD terms. The seasonal effects on sales in Q3 that the company highlighted in its Q2 report materialised; however, the development was a bit weaker than anticipated, although the absolute deviation in sales was not that large (SEK1m). The gross margin was 93.2%, a pick-up from Q1–Q2 2026, and above our forecast of 92.2% as the company saw some improvements in product and customer mix compared with Q2. However, the gross margin was still down Y/Y, from 95.6% in Q3 2025. Adj. EBIT was better (lower losses) than we expected at SEK-6.6m (we forecast SEK-10m). However, capitalised development was higher than we expected in the quarter at SEK9.6m (we forecast SEK6m), so adjusting for these effects, adj. EBIT was broadly in line with expectations. OCF was SEK-5m in Q3, and net cash flow after intangible capex, lease repayments, and effects from the warrant programme was SEK-15m. By the end of the quarter, the company held SEK138m in cash and equivalents.

Estimates. On the back of the Q3 figures, we would expect consensus sales estimates to be revised down by low to mid-single digits.

Share price reaction. The share price has been very weak YTD (down ~70%), yet we struggle to see the Q3 results sparking any tangible turnaround in sentiment, and we expect a negative share price reaction in the mid-single digits.

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