SoftwareOne says it amassed 600,000 Microsoft Copilot users in its H1 2024 as it reined in its full-year growth expectations.
In interim results unveiled this morning, the Switzerland-based software licensing giant revealed its revenues rose 7% year on year to 529.9m Swiss francs in the six months to 30 June 2024 – in line with expectations.
Here we round up five key takeways from the results…
1. Copilot clamour
SoftwareOne last August set out plans to become the “number one Copilot partner for Microsoft”, with ambitions to hit $100m mid-term revenues.
Having amassed 325,000 new Copilot 365 users in its Q1 (following its general release in January), the 9,300-employee giant nearly doubled that tally to 600,000 in Q2.
New Copilot 365 service engagements for the quarter hit 240, down from around 325 in Q1.
Although activity was down slightly quarter on quarter, SoftwareOne says the figures show it “maintained its momentum in capturing the Copilot 365 market opportunity”.
Its update comes after a rash of UK partners – including Bytes Technology Group, Advania and Node4 – announced large internal Copilot 365 roll outs. Despite giving a glowing review of its internal Copilot 365 roll out generally, Avanade warned in June that the tool “may curb original thinking”, meanwhile.
2. Revenue outlook revised
SoftwareOne’s first-half numbers hit expectations, as group revenue clambered 7% year on year to 529.9m Swiss francs and adjusted EBITDA pogoed 11.3% to 121.9m Swiss francs.
The SIX Swiss-listed outfit’s shares did fall slightly this morning as it chopped full-year revenue growth expectations from 8-10% to 7-9%, however.
It chalked this up to “continued macroeconomic uncertainty impacting clients’ purchasing behaviour in DACH”, as well as a change of government in Colombia.
Its adjusted EBITDA margin target of 24.5-25.5% remained unchanged.
3. UK shows its softer side
Although SoftwareOne did not break out its UK&I performance, it conceded the operation – which ranked 108th in the recent Oxygen 250 – saw “softer” results than elsewhere in Europe.
The ‘Rest of EMEA’ segment which houses the UK business saw first-half revenues rise 4.3% to 152.9m Swiss francs.
It’s worth pointing out that SoftwareOne’s revenues as it now reports them are dwarfed by its invoiced sales – its Microsoft gross billings for the first half alone totalled $11.9bn.
4. SME the place to be
SoftwareOne’s ‘Vision 2026’ programme is “progressing according to plan”, CEO Brian Duffy said.
Under the strategy, the reseller has opened new sales hubs in Nashville and Barcelona that take a “digital-first approach to capture market share in the under-served SME segment in a scalable, cost-efficent way”.
Initially these will focus on the Microsoft tech stack, before offering a broader portfolio.
A new global alliance team to manage “prioritised partnerships” with the hyperscalers has also been established.
Vision 2026’s overall remit is about focusing on strategic growth priorities, sharpening execution and margin expansion.
5. Suitors are circling
The future of SoftwareOne’s ownership has had more twists and turns than an episode of Game of Thrones over the last 15 months.
According to a Reuters report last month, Apax Partners, Bain Capital and CVC are all currently exploring potential bids for SoftwareOne.
Shareholders removed SoftwareOne’s previous board in April, after it rejected a 2.9bn Swiss franc offer from Bain in Jaunary (having twice spurned Bain last summer in what a Canalys analyst billed a prime example of the “disjointed valuation market” that existed).
“Indications of interest have been received. Discussions, although challenging given the general business environment, are progressing. The Board will provide further updates if and when required,” SoftwareOne stated.
