Nagarro Unaudited Q3 2026 Results
Nagarro, a global AI‑native engineering and transformation firm, issued its unaudited financial statements for the nine‑month period ended 30 September 2026 and for the third quarter of 2026.
For the nine‑month period, revenue reached €755.5 million, up €2.1 million (0.3%) from €753.4 million in the same period of 2025; on a constant‑currency basis this represented a 2.7% year‑on‑year increase. Gross profit was €243.1 million, essentially flat versus €243.5 million a year earlier, yielding a gross margin of 32.2% compared with 32.3% previously. Adjusted EBITDA rose to €107.3 million, a 2.4% increase YoY and an adjusted EBITDA margin of 14.2% versus 13.9% in 2025. EBITDA, however, declined to €99.0 million from €108.5 million, an 8.8% drop, primarily because net expense from special items rose by €12.1 million, driven mainly by a €14.4 million increase in share‑based payment arrangements (partly offset by €1.1 million lower investigation expenses and €1.3 million lower audit fees). The most material adjustments to EBITDA for the nine‑month period were €5.1 million of share‑based payment expense and €1.8 million related to the public takeover offer. EBIT fell to €73.0 million from €82.3 million, while net profit increased modestly to €42.5 million from €41.0 million, reflecting lower withholding taxes on intra‑group dividends. Operating cash flow (OCF) improved slightly to €77.7 million from €77.1 million; when adjusted for factoring changes, OCF was €85.0 million versus €81.0 million a year earlier.
In the third quarter alone, revenue was €255.0 million, a marginal increase of €0.4 million over Q3 2025. On a constant‑currency basis the quarter was flat (‑0.2% YoY), translating to a 0.2% rise in euro terms. Organic revenue growth was negative 1.6% in constant currency (‑1.2% in euro terms). Gross profit stood at €83.9 million (32.9% of revenue) versus €84.2 million a year ago. Adjusted EBITDA declined to €38.3 million, a 13.1% drop YoY, and represented 15.0% of revenue compared with 17.3% previously. EBITDA fell sharply to €32.5 million from €43.5 million, driven by a €5.8 million reduction in adjusted EBITDA and a €5.2 million increase in net expense from special items, mainly a €6.4 million rise in share‑based payment expense (partly offset by €1.0 million lower investigation expenses). The key adjustments for the quarter were €4.6 million of share‑based payment expense and €0.9 million linked to the public takeover offer. EBIT decreased to €23.8 million from €34.9 million, partially offset by a €3.1 million reduction in income‑tax expense. Net profit fell to €12.7 million from €21.4 million, a 40.5% decline YoY.
Client concentration improved slightly, with the number of clients generating more than €1 million in revenue rising from 184 at 30 June 2026 to 186 at 30 September 2026. Days‑sales‑outstanding (DSO) improved from 82 days on 31 December 2025 to 80 days on 30 September 2026. Operating cash flow for the quarter increased to €48.2 million from €34.7 million, primarily due to better customer collections and lower intra‑group dividend taxes.
Cash and cash equivalents were €124.3 million as of 30 September 2026, essentially unchanged from €124.6 million at 31 December 2025. Loans and borrowings declined to €278.0 million from €310.1 million, reflecting repayments of a syndicated revolving credit facility. The company employed 18,499 professionals across 39 countries at quarter‑end.
Overall, Nagarro delivered modest top‑line growth on a constant‑currency basis for the nine‑month period, while profitability metrics such as EBITDA and EBIT showed declines due to higher share‑based compensation and special‑item expenses. The quarter exhibited flat revenue, a notable contraction in adjusted EBITDA and net profit, but improved cash conversion and a reduction in leverage.