Good day, everyone, and welcome to Gofore's Q2 and first half results presentation. Today in typical fashion, it will be me, Mikael Nylund, the CEO of Gofore Group, and our fresh-ish CFO, Saara Ukkonen, who will be presenting the results, and we will start by that.

Then we'll have a little bit of a special segment in today's program with an update of Gofore's Defense and Space business, where we will be joined by Markus Asikainen and Timo Latvala, who are the responsibles of respective business areas at Gofore. Then we'll round off by looking at targets, outlook, and some H2 priorities for us.

We will have time for questions at the end of the presentation or today's stream, you can already, whenever you feel like it, you can post those questions on the streaming platform, and Emmi from our Investor Relations here will be screening your questions and looking into those, and we'll be taking them at the end. Without further ado, let's go, and let's start with a short overview of what has happened.

Profitability-wise, it has been steady at adjusted EBITA at 7.2% in Q2. On the one hand, it's a clear signal that we've made an improvement year on year.

We have successfully implemented a lot of measures, including integrations of our recent company acquisitions, restructuring our skill profile, and also improving the customer delivery that were burdening the result a year ago. On the other hand, it also means that there's still room for improvement.

We know we can, we know how to do it. We know that a bit brighter outlook with the market will help us do that, and we can improve the profitability further.

Growth continued, two consecutive quarters with organic growth now, very important signal that we can grow, that the market allows for growth, even though it's been a little bit toned down. Our strategic choices have been correct, have been functioning in the market.

That we have growth drivers like simulator technology, we have cybersecurity expertise that is especially wanted in the market right now. Today's topic, Defense and Space, is for sure also one of the growth drivers in the portfolio right now that drives the growth.

We have the stickiness with the customers, we have long-term customer relationships, and that's what, of course, keeps the basis of the business going. Overall growth was over 30%, very strong.

This makes us a very different company from a year ago. What we want to today also point out is that it not only makes us bigger, it makes us stronger, and stronger for the better market situation that we are expecting to start, hopefully, now, but at some point in the future.

Lastly, sentiment looking forward, we, of course, will have, let's say, growth in the future as well because of the, and thanks to the, company acquisitions that have been made, the investments that have been made in 2025 and start of 2026. We have also the first divestment that we will be talking about today a little bit more, and that will have effect starting September 2026.

A solid start to Q3 in July and also the start of August, we feel quite good about this right now. Some of the highlights for the first half: net sales plus 31%, organic growth for both quarters in 2026.

We are quite happy with that, and again, goes to show that we have the ability to grow in a difficult market. We have been making very fundamental and big investments that have changed the company.

Synergies support the profitability at 7.3%, almost doubled from a year ago, 7.3% adjusted EBITA. At this time, it's quite clear for us that we have needed to spend also to make this growth happen.

Short-term growth investments, of course, are visible also in the profitability, but we believe that the growth as such is the most important thing right now and are happy that we can now show that we have been able to grow. We have a lot of business happening both in Finland and the DACH area, with a lot of wins, especially the public sector big wins that are, of course, always the public knowledge, we can talk about those.

We have City of Espoo, Information Technology Center of the German Federal Government, ITZBund. We have CSC in Finland.

We have the Patent and Registration Office and National Land Survey of Finland that we were able to report in June. A very big win for Gofore and an opportunity to grow in those important, big customers that are covered by that framework agreement.

We have worked with integration, of course. 400 Huld employees joined the group in autumn 2025, and we have now operationally almost completed the integration.

Big work, big, big push from the team making that happen. In the DACH, they have been focusing on the integration of a little bit more recent essentri acquisition.

As mentioned, we will look a little bit more deeply into the first divestment that we have, as Gofore, made when we sold the Huld-originated product design and technical documentation business to a Finnish buyer, the Coe Group. Growth-wise, this is an important year, of course.

It's an investment-driven growth, but it's clear that we are now pulling away from the non-growth years of 2024 and 2025, and that's super important for us as a company. This is not only about making us bigger, as I said, this is about making us stronger in the key customer segments where we have wanted to develop.

Then those are especially the intelligent industry, strategic industry, where we have gained new capabilities via the Huld acquisition especially, and also strengthened the existing ones. Then there's also, and that's the topic of today, the Defense and Space industry, where also Huld acquisition has played a very key part in making that strategic choice that we made in 2024, making that a reality.

Now we are a player in the Defense and Space industry, which we will, as said, dig into a little bit more today. It's been a tough and competitive market.

It's been that for some years now, these results with our customers, with a good customer satisfaction, with a growing amount of big, big customers goes to show that the Goforeans have made a good job, again, with the customers and are appreciated by the customers. It's also about the strategically chosen strong customer relationships, strategic partnerships that we want to be involved with our customers based on the complete offering that we have, the end-to-end offering that Gofore can offer our customers for transformations that are either big or are a little bit smaller, which is, of course, a key topic now that all of our customers are talking about how to enter AI, how to make that AI transformation reality in their organizations.

Defense and Security business area and Wellbeing business area have been the biggest growers now in H1, not surprising, Defense and Security for obvious reasons, Wellbeing being a business area where we have been able to capture some market share in the Finnish market, especially with the public sector clients in that customer segment. As said, number of big customers is again up from 45 last year to 53 now, partly driven by the acquisitions that we made, but a development that we have been aiming at very, very strongly.

People-wise and culture-wise, we've been, of course, focusing quite a lot on acquisitions and the integration of those acquisitions. 400 Huldians, around 100 essentrians in Germany have been joining the organization, a big push, as said.

Thanks to the organization for taking them with open arms and being able to do this integration in a good, good fashion. The divestment that we have mentioned already several times is reducing the amount of employees from 1st of September, about 110 people that will be transferring to the Finnish buyer, the Coe Group.

Upskilling, AI, big topics during the first half of the year. Priorities is always upskilling, making sure that the skills of Goforeans are up-to-date and are answering to the demands of the customers.

There's also a little bit in first half and probably will be restructuring component in the attrition graph that you see here on the right-hand side on the below chart. A little bit over 10% attrition for the first half, which is kind of also taking into account the restructuring measures that we, in this difficult transformation time, have been doing.

Last year, it was much higher. You might remember that was around spring last year.

We had a big restructuring operation with change negotiations and laying off 80 people from Gofore, so that's, of course, even a bigger one. The transformation, we expect, will be visible in attrition numbers for the foreseeable future, but right now, we are quite happy, especially with the unexpected leavers percentage of 8%, so that's a good, good place to be in.

Also the restructuring measures that have been taken, that Saara will be talking about a little bit more, also are visible in the profitability adjustments that have been made during especially the second quarter. Lastly, before Saara takes over, some words about the divestment that we've made.

In June, we announced the sale of the product design and technical documentation business to Coe Group, a business that was acquired with the Huld acquisition. This is about strategy, this is about strategic focus.

Gofore's core is about digital technology, and that's what we want to focus on. We have been looking for a buyer that we feel is good from a customer point of view, but also, of course, from the transferring employees' point of view.

For us, we have a strong feeling that Coe now is that buyer for this business and a good home for this business. Our customers are continuing to get the full service of Gofore, because we have also entered in the cooperation agreement with Coe, and we'll be serving them with the full-service portfolio as we have up until now.

That's important for us that customers will get the same service portfolio also in the future. September 1, around 110 employees will be then transferring to a new employer, and this is about €8 million in net sales, the effect at that point.

Now, Saara and a little bit of a deep dive into the financial highlights.

Yes, thank you, Mikael. Good afternoon from from my behalf as well.

Let's start with the key figures for Q2. Net sales increased by 32% to 58.55 million, and organic growth was 1.8%.

The adjusted EBITDA margin improved to 7.2%, up to 4.6 percentage points year on year. The increase was resulted by higher sales, acquisition synergies, and better management of fixed price projects.

EPS increased to 0.11, and that's an improvement of 0.17 year on year. Then the headcount was around 1,900, up to around 500 people, and this is largely reflecting the acquisitions.

The adjustments, what Mikael also mentioned, mainly relate to restructuring, then the integration, and and the M&A activities, meaning meaning essentri and and the sell-off of product design and technical documentation business. Overall, this is clearly a step in the right direction, but we are not fully satisfied yet, our focus remains on closing the gap to our profitability target.

Then on moving to the sales mix, the share of international sales increased during H1 due to the essentri acquisition. Then you can see in the graph that the split between public and private sector customers also moved to closer to an even balance.

Not visible in the chart, but the product sales grew as as well. At the same time, the share of own work increased.

Overall, the conclusion is that the sales mix is gradually becoming more diversified. Then a little bit more about the profitability.

The profitability clearly improved compared to the comparison period, then remains stable compared with the beginning of the year results. The year-on-year improvement was was supported by higher net sales and and integration synergies and better control of fixed price projects.

Then about the comparison period, that was impacted by by some projects exceeding their estimated workload and and a write-down on one fixed price project. Then when we look at the profitability in the short term, the margin was impacted by target growth investments in sales and and marketing and in the DACH region, which we expect then to result in in also revenue growth.

Customer prices increased by 1.7%, and the average salary change was minus 1.3%, which also supported the overall cost balance. The increase in other operating expenses, there you can also also see the investments to to M&As, then there are targeted investments also in OPEX, and and obviously the business growth also impacts other operating expenses.

The direction is positive year on year, but then the near-term growth investments kept the profitability roughly at the same level as earlier in the year. Then our liquidity and balance sheet, those remain in excellent shape, equity ratio was 50%, cash was around 27 million, and interest-bearing net debt was 21.55 million.

What this basically means that this gives us flexibility to continue investing in growth through further M&As and and investments. Then still our cash flow, what you can see from this chart is that the cash flow from operations was positive.

At the same time, we we continued invest- investing in growth and and returned capital also to share- shareholders. The total net change was minus 15.5 million, but basically the decline in cash reflects reflects acquisition activity, debt repayments, and and then profit distribution.

That was everything from my side.

Thank you, Saara, and as I said, Saara is a little bit fresh with us or with us fresh-ish, started in, I think, in March this year, and we have had a good cooperation so far, looking forward to working with you also in the future, of course. Now, as I promised, the next topic, let's say, a quick deep dive, maybe not that super deep, but some dive at least to Defense and Space business at Gofore.

To do that, I will be joined here by Markus Asikainen, who is responsible for our Defense and Security business, and Timo Latvala, who is responsible for the Space business. Welcome, Markus and Timo.

Thank you.

Thank you.

I'm going to lead a little bit into this topic by giving a short introduction, and that will start by showing this, which is the strategic industries that Gofore is focused on. Since 2025, Defense and Space has been the third strategic industry that we have been focusing on alongside the more mature Digital Society and Intelligent Industry businesses that have been there for a longer time.

For individual customer segments that we count into the Defense and Space part, we talk about national security, mostly public sector customers that work with internal and, to some extent, external security topics. Then we have the defense part with defense industry, defense players in the public sector.

We have space players, which Timo will talk about in more detail afterward. The decision to make this a strategic focus was taken during the strategy process of 2024.

Back in 2024, it was clear for us that we needed more growth drivers. When we looked at the world, we looked at the external forces driving change in the world, of course, we saw that there was a increased volatility of the geopolitical landscape, and there were full-scale war in Ukraine, there were demands for European strategic autonomy, and Finland joining also NATO back then.

These are, of course, forces that continue and acceleratingly influence our operating environment. We also considered Gofore's existing strengths, and looking at the right-hand side, you can see that what we found there is that, of course, we have the comprehensive offering and skill portfolio, which we felt that is applicable to a lot of different customer scenarios, including the Defense and Space part.

We have experience in delivering mission-critical systems, software projects on a national level, and that's something that is directly applicable also to the Defense and Space business. We have, of course, a strong track record of supporting new growth with M&A, with successful M&A.

What we saw as a combination of these external and internal factors is that we have the means to be successful in the Defense and Space industry. We also did quite an extensive discussion internally about the ethics of going into this kind of business, and secured kind of the support of the Gofore community by that way.

Conclusion was that we will be able to break into the defense business, and that's what we set out to do. We released this new strategy at the end of 2024, and then moved quite swiftly to the acquisition of Huld, which happened in summer of 2025, and was actually executed then in, I think, 1st of September in 2025.

That was, of course, something that further strengthened the capabilities, introduced the space capabilities that we will look into now, and, of course, also took big step in, let's say, delivery processes about how you deliver software and solutions in very security-sensitive contexts. That's something that, I think, took us forward a couple of years with one blow, very important in that sense.

With that background, let's go into the more detailed discussion here, and let's start by looking at the market position and the individual markets that we work in. We talk about a unique market position.

I don't think we use that word very lightly, I think that there is a certain level of uniqueness here. Let's start with Markus.

Can you a little bit explain about the Defense and Security business area? What are we actually doing?

What are we working on?

Of course. Thank you, Mikael, and good afternoon from my behalf also.

Our Defense and Security business is going towards our strategy, as you mentioned, and it has been quite a journey so far. It really interesting times we are living.

We are serving customers on both sectors, as you mentioned, from public sector, those internal and external security authorities, but, of course, there is this other side, private sector, mainly Defense and Security industry companies. Especially there are a couple of bigger global companies that we are really proud of to work with, and also there are a certain amount of smaller technology companies that are kind of more or less startups, but building something completely new to the market.

We are part of that development also. We're proud of having this kind of combination of different kind of customers.

Basically, especially in the industry sector, we are mainly involved with development, R&D, and, of course, we are doing also some services there. Of course, our kind of core competence areas like cybersecurity, quality assurance, embedded software development, and so on, those are the areas that we are working with right now with our customers.

Also integrations, to mention some of those.

I think it's quite clear that there aren't any products, there aren't any solutions for the defense industry that don't include, in some way, the digital part also. That, of course, makes the position quite good for us.

Of course.

Yes. We are also helping our customers to kind of refactor or renewing their ways of developing different kind of capabilities.

That's something that we do also daily basis. Then

Timo, you have been working quite long with the space industry. It, I think, inside and out.

Could you kind of give the same insight into that? What do we do there, and what's happening?

Sure. Thank you, Mikael, and good afternoon to everyone.

In the space industry, we have been focusing on three main segments what we've been working very hard on. One segment that we have been working for a long time on is the institutional space industry, where we have a lot of heritage.

This includes customers like the European Space Agency, the big prime contractors, and large space integrators like Airbus, Thales, and Leonardo. This is a segment that is really being impacted by the things that you mentioned earlier, the drive for sovereignty, the drive for the geopolitical tensions, and so forth.

That has had a big impact on this segment. The second sector that we're working with is the private space industry, which has been on quite a tear in the last years as we can see.

Here what we've been able to do is take our existing expertise and apply that to both our Finnish customers and also international customers. We think that going forward that this is a significant growth opportunity for us.

The third segment that we're working on is end users of space data. An application area is still maturing.

All of our customers are not sort of experts in how they can use space data in their daily operations, but we think that we're already sort of helping different kind of companies here in terms of delivering space data. There are good Finnish examples of that, but we're also working with sort of other companies and authorities that are sort of trying to understand how to navigate this complex world of applying space data.

Good. Thank you.

I think especially in this time, it's good to be a Finnish company with this expertise, because the space industry is so blooming also here in Finland, with good examples of companies that have burst into the scene in the last years. When we talk about uniqueness, especially in the market position, I think what really makes this unique is when these areas, when defense, security, and space technology, which you already a little bit alluded to, Timo, start to combine, and the needs start to combine.

What we see in the world right now, of course, already supports this quite a lot. How do you see this, Markus, the convergence part?

There's a quite big change at the moment, meaning that space data has become more or less kind of available for different kind of actors in the defense and security industry also. I see that it's a crucial part of modern digital battlefield.

That's coming from the defense forces. Kind of being able to combine and making some kind of modern integrations and also fusion of data, meaning that enriching your kind of existing situational awareness data or other operational data with space data, that's something that you will kind of get to the next level by combining these different kind of data sources.

That's what we are doing at the moment, especially together with Timo's team. We are collaborating quite tightly together daily basis, trying to find those agile ways to make different kind of integrations and also serve customers in a new way.

I see that when we talk about AI in this area, it's a huge opportunity to also enhance the decision-making. Of course, at the end of the day, it is quite obvious that the human is making the decisions, but still we can go a little bit further with assistant decision-making by AI and using this space data as a little part of that big process, yeah.

Just let me add to that, sort of from space point of view, of course, space data, that's always been an aspect of defense when it has come to the space environment. This dual-use aspect has always, to some extent, been there.

Of course, this has really exploded now in the last year. I think we're really well positioned to benefit from this.

We can both work with the companies that sort of are in the business of both providing and selling space data, and we are also sort of well positioned to help the customers who are taking space data into use in both in terms of understanding the data, how to apply it, and how to integrate it into their systems.

What we, of course, maybe sadly see is that if we have learned to think of this as a superpower capability to use space as one part of, let's say, warfare and defense, it's now available for others as well. The sovereignty push is driving that, of course,

and,

luckily, also, for example, Ukraine has these capabilities to use that data. More importantly, I think, for the future, what we hope is happening is that also civilian applications would be more commonplace, because there are so many for that.

If we continue then to looking at some, let's say, more concrete things that happen in the industry, we already talked about the convergence, how the blending of sectors happens. If you look at the middle box on this slide, and on the phenomena and the trends that we see, how would you, Markus, start by talking about the dual-use part?

Yes. It's really interesting topic.

We see that the need is rising for sensor data from civil sources, meaning that this kind of sector barriers are blurring. We can see that even defense force type of actors or other security actors need more data from those quite isolated environments that are existing in the civil side.

There is a huge potential for being integrator between these different kind of, I might say, silos in a way. At the same time, we see that there's lots of data that can give benefit also to creating kind of national awareness of resilience, and so on.

We are now developing also our own concept for dual-use, meaning that we work quite closely with different kind of companies for finding solutions for, for example, having the crucial data out of the intelligence machines or devices. That's one example.

We have kind of taken the bold to create something new into the market, and be one of those first ones who will take the kind of a step forward, how do you integrate agilely different kind of actors and different kind of technical environments?

Yeah. That's, of course, something that also our understanding of the intelligent devices of the intelligent machinery helps us in doing.

Exactly, and, in general, this is really huge potential, because this enlarges our potential customer portfolio. We are not talking about anymore kind of only defense or security customers.

We are talking about, for example, intelligent industry customers. We are talking about retail and services customers, and so on.

Yeah. Next, Timo, expanding core expertise.

I guess with core expertise, I think we can talk about the 15-plus-year experience in software in space, which is a very specific area. How would you...

I think it's sort of important to understand that why we're able to do all of these things is that we really have deep expertise in certain areas related to development of space systems and understanding of space data. In order so that we can continue growing and expanding into new domain areas, we do need to deepen that knowledge in certain specific areas, perhaps in things like, for instance, analysis of synthetic-aperture radar data, which is very fashionable these days.

It's also, of course, about making sure that the strategic asset that we have in this deep expertise area remains relevant and fresh.

Yeah. The third one, we already talked about a little, but the space data part.

We have seen that the kind of available data is exploding, and what you can use for different applications the opportunities are there. What do we see here?

Just like you said, the amount of data is really growing quickly, and we can see it from the number of launches and the number of announced launches in terms of different sensors and satellites that are being launched. There's really going to be a lot of opportunities for data there.

In terms of sort of being able to really help our customers here, what it sort of requires, of course, that we first of all have deep understanding of our customers and their domains, because that is a key prerequisite for applying that data. Then, of course, we need data analysis expertise and AI expertise so that the data can be fused with different sources, and we can get the best out of that data, the most value, if you will.

Then finally, we also need to make sure that we understand the space-specific dimensions of the data, we need to have a good understanding of Earth observation technology so that we understand the instruments, etc., and sensors that are actually producing the raw data that we are then using in these different applications.

Good. I think that's the understanding of the nature of the data and that it's not just any data is really important also, and something that we have a strong experience in, I'm happy to say.

Thanks at this point, Markus and Timo, about the insights there, and lastly, we can look at the right-hand side box here about the situation right now. As of now, we have around 18 million in net sales with this Defense and Space strategic industry.

That's growing as we have, of course, communicated earlier, with a very strong organic growth, but, of course, even stronger total growth due to the and thanks to the Huld acquisition. Over 100 full-time equivalents of experts work in these projects, even a bigger number of experts that have the experience required for these kinds of projects, and hopefully many more in the future.

There's need for that, there's projects, we also, of course, have a bottleneck in being able to recruit the necessary people. We will be coming back to these topics in the Q&A session.

I see that we already have some questions from this area, but let's take all of the questions at the end of the show, and we'll continue with the last topic of targets and 2026 outlook. I just want to remind all of you about the cornerstones of Gofore strategy.

We've talked about this quite a lot today already, especially on the left-hand side, the areas for growth. We have a strong focus on chosen strategic industries, which are Digital Society, Defense and Space, and Intelligent Industry.

We have a deep understanding of the customer-specific challenges and how to solve them. Our geographical focus is in Finland and DACH, and how we create value is by having the best people in the industry, by focusing on strategic customers, building long-term strategic relationship with customers, being their prime transformation partner.

How we are able to become that is the exceptional offering that we build along the years with an end-to-end transformational offering. Our long-term financial targets are 500 million of net sales by 2030, 15% of profitability in adjusted EBITA.

What you see from the numbers today, of course, shows that we have some way to go, and we also are aware that we require some tailwind from the market to be able to reach that. In the terms of net sales, of course, also the investments that we have made in 2025, 2026 have helped us along the journey, we are not that far away, and we are confident that these targets that we have set out for ourselves are achievable.

If you look at a short-term view for Q3 performance drivers, we have some clear growth drivers, with the acquisitions clearly driving net sales also in Q3. The sale of the product design and technical documentation will have some negative impact on growth in starting September, starting to show in Q3 and then further into Q4.

We do think that the market here is now, especially here in Finland, is starting to gain traction. We see that Finland's economy is recovering, and that will help especially with the export-heavy manufacturing industry.

Intelligent industry customers the market demand on that side will be visible with the economy picking up. In the DACH region, we are also expecting moderate growth improvements in the second half of the years and, but, of course, still uncertainty there.

We have seen that the German economy is struggling, and we are also impacted by that. Profitability-wise, the growth part will help us.

We want to be able to uphold the organic growth, accelerate the organic growth, that will help us also on the profitability side. For product design and technical documentation business, short-term, it will have a slight negative impact on profitability.

We will be transferring volume of business, but not so much overhead costs. In the longer term, it's a positive effect on profitability because of the lower gross margins of said business compared to Gofore's other business.

We are expecting the DACH region's profitability to also start positively impacting the group profitability, and overall these profitability drivers, we see that, as a sum, will be positive for us in Q3. To round this off with the priorities for our second half, of course, as we've talked about, the organic growth trend, which we have managed now to uphold for two consecutive quarters, we think that's a trend already.

We need to accelerate that, and that will have a lot of positive effects also concerning profitability and other parts of the business. How we can do this, we have the higher growth opportunities in the portfolio, with especially growth-driving parts.

We talked about Defense and Security. We expect that to be able to drive growth.

We have simulator technology, we have cybersecurity expertise that both have grown quite significantly in the last 12 months, and we have very, very strong growth in those areas that in themselves drive growth, but also help other parts to achieve growth for Gofore. Especially intelligent industry, when the market picks up, when the, let's say, uncertainties in the market become a little bit less visible, we expect that to be a big opportunity.

We see that there's a certain level of on investment debt with these kinds of customers that have accumulated, and when that debt starts to be paid back, then there's opportunities for Gofore in that customer segment. We want to continue renewing the offering and the skill portfolio.

It's, of course, important because the AI-driven market transformation challenges us all the time, in order for us to be long-term competitive, we need to make sure that the offering and skill portfolio matches that AI market. I think we are doing well there, both continuing to invest in upskilling, of course, improved delivery practices, but also make sure that we have a healthy renewal of the skill structure, which we talked about from the point of view of churn also, that it's healthy in times like these to have a certain level of churn, of attrition of employees.

We will continue the M&A activity and try to take advantage of the good opportunities in this active market, and, of course, continue the profitability improvements that especially Saara talked about today. To conclude, once more, I'm very happy that Gofore is a different kind of company today than it was a year ago at this same time.

As said, not only are we over 30% bigger, we are much stronger, and that strength will come in handy when the market picks up. Now for some Q&A, and we will have both Saara and Markus and Timo here answering your questions, and let's see what we have in terms of questions, and try to start a little bit with Defense and Space-related questions.

We have a question here that is quite clear, but I think goes especially to Timo, a wide question, but clear: Could you give some examples of civilian use of space data?

There are several uses of civilian space data. The obvious ones are obviously weather-related that are, of course, actively in use already.

If you think about sort of where are there new applications developing, examples, for instance, include monitoring of critical infrastructure like bridges, road, railways is a good example; use of sort of flood modeling, sort of in order to predict flooding and similar; and then there are also examples of soil monitoring and agricultural sort of applications. These are some examples of where space data can use in new and innovative ways.

Already is used.

There are sort of concrete examples of this to some extent in Finland, but especially more if you go sort of, let's say, wider in the world, yeah. Yeah.

Maybe Markus can try to answer this other question a little bit. I will start a little bit, though.

The question is that: Are you a market leader with defense among Finnish consultants, and what are your main competitors? I will start by saying that this is not an area where we exactly know what everybody is doing because of the nature of the business.

I don't think we can say or say that we are not the market leader, and maybe not comment directly on that, but could you kind of give some color on what kind of competitors we have there? Yeah.

Of course, there are this kind of established players, especially in the Finnish market, companies that have done defense especially for decades. They have certain strengths.

At the moment, of course, they are developing their portfolios constantly. Are we.

As you mentioned, Mikael, earlier, I would like to point out that we try to be also the different one in the market. We are a company that brings something new on the table.

We want to be the company that be proud of giving some kind of new thinking for new defense or especially in the Defense-Sec sector in general. In that sense, I would say that we are at least challenger, but I'm not putting us online or to certain position at the moment.

I think what we hear from the customers is clear that there's a need for challengers.

Exactly.

Kind of new thinking, and, of course, it's important that some competitors have worked quite a long time with the defense industry, and that's a strength as well, but it kind of makes the perspectives a little bit limited when you work with the same companies

and as

suppliers for a long time.

Exactly. I would continue that it's good to keep in mind that certain cases, there are companies might be competitors, but at the same day, we might make collaboration together.

It's

good to keep in mind that this is actually ecosystem that will work efficiently as it runs forward, yeah. Yeah.

Another question for Timo, I think, is that: Is your space offering purely for the EO, Earth observation, players, or are you able to benefit from the communications and broadband satellites as well?

Traditionally, where we have a very long heritage in working with what is so-called upstream, meaning sort of solutions for satellites and also the early data processing, and this is applicable both to Satcom players and also Earth observation satellites, and so forth. We have the capability to work with both, but we have worked more with, let's say, with Earth observation-related projects than in the Satcom area.

Then maybe both for Timo and Markus to comment: What are the key barrier entries to your current position within the Defense and Space, barriers of entry? How easy to gain new expertise?

Can you find competence from the markets, or are you internally training staff?

Would you start?

If we look at it from our perspective, the barriers to entry are quite significant, because having the customer relationships is, of course, one. Then having the expertise of running the projects and understanding the technology.

In order so that we are able to grow, what we need to do, yes, we do hire sort of European-wide in terms of space experts, but we also place quite a lot of significant effort into sort of training new people who come with, let's say, relevant skills, but don't have the absolute domain knowledge. That is something that we've been working on for a long time already because otherwise this would really become a growth constraint.

This is something that we have put quite a lot of emphasis on.

I think Timo put it quite well, but to continue, of course, we are doing both. We are training our people, especially the AI is something that is kind of refactoring almost everything in consulting, and so on.

That's something that we do daily basis at the moment. Of course, when the market is getting higher or rising, it's quite obvious that, in some places, we are kind of trying to kind of compete about the same experts.

It's not so easy to get the kind of professionalism that we are looking. Of course, we have been quite successful for getting that people, and, of course, that's something that we also think when we are considering different kind of acquisitions, and so on.

What might be the kind of good combination of different kind of capabilities from different kind of approaches. Yeah.

At last, I would say that, of course, there's something to do with how customers are, especially in the public sector, they are procuring. That's kind of a known fact that we should kind of improve and get the innovation cycle shorter, and also get more efficient tendering processes.

Yeah.

As has been clear today, I think it's a specific expertise to work in these areas, but there are overlapping things that overlap with expertise that Gofore already for a long time has had, for example, the big projects, delivering big projects for the public sector customers, the public sector knowledge as such. It's important for national security customers, as we discussed, also the manufacturing industry, intelligent devices.

Also the defense industry is about intelligent devices, things that kind of overlap.

We have quite good understanding internally of different kind of people who want to work with this area. We have certain amount of people in pool that they are kind of waiting to get here.

It's just when I will get the first project, and so on. That's good way to also kind of enhance the capabilities.

Yeah. Then we have something that maybe you want to contribute to also, Saara.

Maybe I will start, but the question is that: Do you see these organic growth investments materially still impacting profitability on H2? They will have an impact on profitability in H2, what we're talking about is, for example, a big push in sales work, and that's something that doesn't go away in overnight.

That's important for us that we still push for the organic growth, and we want to invest in that. Yes, they will have some impact also on profitability in H2.

Do you want to add something there?

I think you concluded it quite well. Obviously, there is some uncertainty in the DACH region, what we mentioned already earlier.

Yes, we expect obviously those investments to bring growth.

Good. Then we have a three-part question, and maybe we take that in three parts then.

It's about AI: Given that AI enables more efficient development, have you seen smaller competitors appearing in tenders, which in the past would have been out of their scale? I think it's a little bit early days to answer definitely this kind of question.

I think it's clear already from evidence, and I think it's also rational that new players will come into the market, and that for sure will happen. How strongly they can compete with purely AI-based solutions to what has traditionally been seen as bigger companies' transformational projects, that remains to be seen.

I don't think we have evidence of this kind of development at least materially impacting things yet. Of course, it's early days considering the AI effects.

Have you seen customers' willingness or readiness to start larger scale AI transformations picking up, or are the AI projects still smaller and experimental? I think we are not the only ones that have come with the message that, yes, gradually these programs become investments of some significance.

Yes, I would say that gradually that is picking up. It's not going to probably change kind of overnight that we wake up tomorrow and see everything change and AI transformations being the kind of biggest part of the market.

On the other hand, of course, AI transformation will be playing some part in basically every project from now on. It's a little bit of both, but, yes, I think there's a clear shift towards that, but it's not something that just happens overnight.

It's a shift that takes time. Then the third part: With the support of AI, some of your peers have been transforming toward own IP software.

Do you have initiatives or projects where you would aim to create scalable own IP products or delivery methods? I think for us, this is not only and not just an AI question as such.

We have already before this AI transformation, we've said that we want to do this. We want to support the consultancy business by having our own IPRs, of which the simulator technology is a prime example.

We have a product that is based on own IPR that supports the consultancy work primarily in the intelligent industry strategic industry. Yes, we don't see that so much as an AI question.

Of course, that transforms also the simulator business. We can use AI for faster development for simulator software, and that's important, but it's not primarily an AI question.

For us, whenever we want to build something that is own IP and own solution, we want to not be kind of offering generic solutions where we know that there are players out there that are better suited to that. We want to provide solutions that are customer segment-specific or otherwise more niche-level type of solutions.

Do you want to try this, Saara? You have now two sequential quarters of positive delta between customer prices and salaries.

What do you expect going forward?

Obviously, we expect it to develop positively also moving forward, I think the direction has been right.

On the other hand, it's clear that we will have tough competition price-wise also, going forward. It's not going to be easy, but a healthy business is characterized by a kind of positive balance between customer prices and salaries, for sure.

It's a big priority for us. Do you expect organic net recruitment going forward?

Yes, and that's if we look at just consultancy force, that's what we've had also for this year, for example. Hopefully that will accelerate, but at least be on the same level as now.

I think with that, we have handled all questions, and Emmi is nodding, and I look at the time. It's 2:00.

Thank you so much, everyone, for joining us for this results presentation, and see you in the Q3 results presentation.