When Will Zwipe AS (OB:ZWIPE) Turn A Profit?

Zwipe AS (OB:ZWIPE) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Zwipe AS provides biometric card-based access control security solutions to enterprises and facilities in Norway and internationally. The kr56m market-cap company announced a latest loss of kr100m on 31 December 2023 for its most recent financial year result. The most pressing concern for investors is Zwipe's path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Zwipe

Zwipe is bordering on breakeven, according to the 2 Norwegian Electronic analysts. They anticipate the company to incur a final loss in 2025, before generating positive profits of kr66m in 2026. The company is therefore projected to breakeven around 2 years from now. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 73%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Zwipe's growth isn’t the focus of this broad overview, though, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 17% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Zwipe which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Zwipe, take a look at Zwipe's company page on Simply Wall St. We've also compiled a list of key factors you should look at:

1. Valuation: What is Zwipe worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Zwipe is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Zwipe’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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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.