Results: TietoEVRY Oyj Delivered A Surprise Loss And Now Analysts Have New Forecasts

Shareholders might have noticed that TietoEVRY Oyj (HEL:TIETO) filed its second-quarter result this time last week. The early response was not positive, with shares down 7.2% to €15.27 in the past week. Revenues came in at €463m, in line with estimates, while TietoEVRY Oyj reported a statutory loss of €0.29 per share, well short of prior analyst forecasts for a profit. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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Following the recent earnings report, the consensus from nine analysts covering TietoEVRY Oyj is for revenues of €1.85b in 2025. This implies a concerning 33% decline in revenue compared to the last 12 months. Statutory losses are forecast to balloon 38% to €0.79 per share. Before this earnings report, the analysts had been forecasting revenues of €1.87b and earnings per share (EPS) of €0.62 in 2025. So despite reconfirming their revenue estimates, the analysts are now forecasting a loss instead of a profit, which looks like a definite drop in sentiment following the latest results.

Check out our latest analysis for TietoEVRY Oyj

The consensus price target held steady at €16.27, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic TietoEVRY Oyj analyst has a price target of €20.00 per share, while the most pessimistic values it at €12.30. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the TietoEVRY Oyj's past performance and to peers in the same industry. Over the past five years, revenues have declined around 0.03% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 55% decline in revenue until the end of 2025. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue shrink 3.5% per year. So it's pretty clear that TietoEVRY Oyj revenue is expected to decline at a faster rate than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts are expecting TietoEVRY Oyj to become unprofitable next year. They also made no changes to their revenue estimates, implying the business is not expected to experience any major impacts to the current trajectory in the near term, even though it is expected to trail the wider industry. The consensus price target held steady at €16.27, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on TietoEVRY Oyj. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for TietoEVRY Oyj going out to 2027, and you can see them free on our platform here..

It is also worth noting that we have found 2 warning signs for TietoEVRY Oyj that you need to take into consideration.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.