Q3 initial: Solid quarter and outlook in line with expectations

GiG Software delivered a solid Q3, in our view, with a marginal beat versus our expectations on sales but a small miss on adj. EBITDA (albeit on a low level) related to somewhat higher than expected other administrative expenses in the quarter.

Overall impression. Sales came in at EUR8.5m (-12.4% Y/Y), vs. our expectation of EUR8.2m, and adj. EBITDA at EUR0.8m, vs. our estimate of EUR1.1m (EUR1.2m in Q3 2025). We argue the deviations across the board are minor compared to what we expected and think key now is that the business is not deteriorating more than expected on an organic basis while cost discipline is maintained, as this should drive cash flow improvements in the coming quarters. GiG remains focused on cost discipline to drive margins and cash flow improvements, with the EUR4.5m annualised savings announced in January 2026 and the EUR6m annualised savings related to closure of loss-making partners, and markets said to align the cost base of the core business with the revenue. Focus now seems to be on the integration of 888Africa, enhancing GiG’s broader proposition and supporting earnings growth in the coming year, we believe.

In terms of outlook, GiG broadly reiterated its 2026 guidance (increasing the bottom end of the range marginally) at revenue of EUR45m–48m and adj. EBITDA of EUR5.5m–7m. For 2027, it now expects revenue of EUR85m–90m and adj. EBITDA of EUR17m–19m, compared with our expectations of EUR87m and EUR16.3m, respectively.

Estimates and guidance. We expect only minor consensus estimate revisions, given that the guidance range for 2026 is roughly unchanged and 2027 should not contain major surprises following the information released when the 888Africa acquisition was announced, we believe.

Share price reaction. While we do not expect any material consensus estimate revisions, we believe the report and positive outlook are likely to lead to outperformance vs. the market today.