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Original-Research: Verve Group SE - from GBC AG

02.03.2026 / 10:30 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
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Classification of GBC AG to Verve Group SE

Company Name: Verve Group SE
ISIN: SE0018538068

Reason for the research: Research study (Note)
Recommendation: BUY
Target price: 7.65 EUR
Last rating change:
Analyst: Marcel Goldmann, Cosmin Filker

Revenue development FY 2025

On 19 February 2026, the Verve Group published comprehensive preliminary
figures for the past financial year 2025. According to these figures, the ad
tech group achieved a significant increase in reported consolidated revenue
of 26.1% to EUR 550.92 million (PY: EUR 437.01 million) in the past financial
year despite a difficult advertising market and challenging environment,
thanks to solid performance in the first and final quarters. The rapid
revenue growth was also positively influenced by the change in revenue
recognition in accordance with IFRS 15 (reporting gross revenue instead of
net revenue as previously) that took effect in the third quarter. In terms
of comparable revenue (pro forma reporting of revenue before Q3 2025 based
on gross revenue in accordance with IFRS 15), however, a significant
increase in consolidated revenue of 8.4% to EUR 601.82 million (PY: EUR 555.19
million) was recorded.

The positive revenue development was driven in particular by the significant
growth in the fourth quarter of 9.9% to EUR 193.84 million (comparable revenue
in Q4 2024: EUR 176.44 million), which also marked a return to growth
(following previous declines in revenue in Q2 and Q3 2025). Growth in the
fourth quarter, traditionally the strongest quarter of the year in terms of
revenue, was driven by significant organic revenue growth (organic revenue
contribution: 5.3%). In addition, organic growth was supplemented by
inorganic growth effects from the acquisitions of Captify and Acardo in Q3
2025, which contributed 12.2% to revenue growth in the final quarter.

It should be noted that this significant revenue growth in the fourth
quarter was achieved despite a customer-specific effect that led to the loss
of this customer and a high year-on-year comparison basis (positive one-off
effects in Q4 2024, mainly due to high political advertising expenditure).
In addition, the pace of growth in the final quarter was slowed by
considerable 'currency headwinds', as according to the company, the US
dollar depreciated by 9.0% year-on-year, which had a significant negative
effect on revenue of around 8.0%.

The organic revenue growth recorded in the final quarter was primarily due
to an increase in the software customer base. The total number of software
customers on Verve's ad tech platform at the end of the fourth quarter rose
significantly by 26.7% year-on-year to 3,734 (total number of customers in
Q4 2024: 2,948). In the large customer segment (revenue volume >$100K), the
number of customers remained virtually stable at the end of the fourth
quarter at 1,124 (Q4 2024: 1,140), with the number of large customers rising
significantly again by 5.3% compared to the third quarter (number of large
customers in Q3 2025: 1,067). As overall customer growth was thus above
organic revenue growth, these key figures already reflected the first
positive effects of the significant expansion of the sales base.

At the same time, the number of ad impressions placed rose significantly by
13.1% to 310 billion at the end of the fourth quarter (ad impressions Q4
2024: 274 billion). The customer retention rate reached a record level of
99.0% in the fourth quarter (Q4 2024: 97.0%), underscoring the high level of
customer satisfaction with the unified technology platform. The significant
revenue recovery in Q4 also highlights the positive effects of the
successfully completed platform migration, which was launched in Q2 of last
year.

Earnings performance in 2025

The structural cost and efficiency measures implemented over the course of
the year already had a noticeable effect on margin and earnings development
in the fourth quarter. As a result, the gross margin (comparable revenue
minus purchased services) increased significantly to 44.6% in Q4 2025 (gross
margin Q4 2024: 40.6%) and also improved significantly compared to the
previous quarter (gross margin Q3 2025: 36.6%). This margin recovery is
primarily the result of successful platform unification and the associated
significant improvement in the performance and efficiency of the technology
stack, as well as strengthened operational leverage (including greater
scalability).

Despite higher gross margin and higher gross profit, adjusted EBITDA
remained stable at EUR 48.60 million (Q4 2024: EUR 48.50 million) due to
significant sales investments and negative currency effects. This resulted
in an adjusted EBITDA margin (on a comparable revenue basis) of 25.1% (Q4
2024: 27.5%).

In terms of operating earnings for the full year 2025, EBITDA declined
moderately to EUR 122.12 million (PY: EUR 128.52 million). Adjusted for one-off
costs and special effects (e.g. M&A and consulting costs or restructuring
costs), adjusted EBITDA (Adj. EBITDA) actually rose slightly to EUR 134.40
million (FY 2024: EUR 133.20 million). This resulted in an adjusted EBITDA
margin (on a comparable revenue basis) of 22.3% (FY 2024: 24.0%). In our
opinion, increased cost optimisation measures, growth initiatives (e.g.
expansion of the sales base and strengthening of the service offering) and
unfavourable exchange rate effects (primarily a weak US dollar against the
euro) in particular prevented a further improvement in earnings.

Forecasts and model assumptions

The company guidance confirmed and raised by Verve management with the
Q3/9-month figures (revenue of EUR 560 million to EUR 580 million and Adj.
EBITDA of EUR 125 million to EUR 140 million) for FY 2025 was thus close to the
lower end of the forecast range in terms of revenue and above the midpoint
of the technology company's forecast range in terms of earnings. Our revenue
estimate (GBCe revenue: EUR 571.05 million) was narrowly missed, whereas our
earnings forecast (Adj. EBITDA GBCe: EUR 127.85 million) was exceeded.

With the publication of the preliminary financial results, Verve's
management also provided a detailed outlook for the current 2026 financial
year. Following strong growth momentum in the fourth quarter, further
investments in the sales base, improvements to the platform structure and
AI-based customer solutions, the ad tech group expects the dynamic growth
trend of Q4 2025 to continue in the current financial year. On a
conservative basis, Verve therefore expects revenue in the range of EUR 680
million to EUR 730 million and adjusted EBITDA in the range of EUR 145 million
to EUR 175 million for the current 2026 financial year. According to the
company, the Verve Management Board has also applied a robust safety margin
to this forecast range.

In view of the operating result for the past financial year (Adj. EBITDA FY
2025: EUR 134.4 million) and the expected effects of the cost-cutting
programme announced in Q3 2025 (expected annual personnel cost savings from
2026 of approximately EUR 8.0 million) as well as the earnings contributions
from the two recent acquisitions (pro-forma Adj. EBITDA contributions from
Captify & Acardo M&A in FY 2025 according to Verve Group: EUR 7.8 million), we
consider this guidance to be significantly conservative, particularly in
terms of earnings. Further relevant profitable revenue potential is opening
up, among other things, from market growth in the core markets (according to
our research, expected market growth of approximately 9.0% for the global
digital advertising market in 2026) and, at the same time, possible market
share gains.

Against the backdrop of their successful return to profitable growth in the
important fourth quarter of 2025, the positive outlook and the consistent
implementation of their growth strategy, we confirm our previous revenue and
EBITDA forecasts. Due to non-cash depreciation effects (primarily relating
to PPA and product development depreciation) in the past financial year that
were significantly higher than expected, we have reduced our previous net
income estimates for the current 2026 financial year and the following year,
2027. We have included the following financial year 2028 in our detailed
estimate period for the first time with specific revenue and earnings
estimates.

Thanks to the continued intensive expansion of its sales base, the improved
platform structure (greater efficiency and scalability following
unification) and innovative ID-less targeting solutions, Verve should be
able to achieve significantly higher growth momentum again starting in the
current financial year. With the help of their improved gross margin
structure and optimised technology base, it should be possible to achieve
significantly above-average earnings improvements in the future, in parallel
with the expected strong revenue growth.

Based on our confirmed revenue and operating profit estimates, we have
slightly lowered our previous price target to EUR 7.65 (previously: EUR 7.95)
per share. Our target price reduction results from the increase in the
risk-free interest rate (to 3.0% instead of 2.5% previously) and the
associated increase in the weighted cost of capital (to 9.7% instead of 9.3%
previously). On the other hand, the first-time inclusion of the 2028
financial year in our detailed estimate period and the resulting higher
starting point for the forecasts for the following financial years had a
positive effect on the target price. In view of the current share price
level, we therefore continue to assign a 'BUY' rating and see significant
upside potential for Verve shares.

You can download the research here:
https://eqs-cockpit.com/c/fncls.ssp?u=024066b4b7afd440a68d9485c7b476db

Contact for questions:
GBC AG
Halderstrasse 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de

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Date (time) of completion: 02/03/2026 (8:42)
Date (time) of first distribution: 02/03/2026 (10:30)

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2283686 02.03.2026 CET/CEST

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