SoftwareOne issues first combined guidance post-Crayon acquisition as H1 results continue to drag

Revenues, reported just for SoftwareOne, declined eight per cent YoY, dragged down by poor NORAM trading and Microsoft incentive changes

SoftwareOne has reported half-year results in line with expectations.

Group revenues were down 4.9 per cent year-on-year and eight per cent year-on-year in reported and constant currency, respectively, coming to CHF 487.7m (450.8m) in H1.

The Swiss service provider continues to push forward on its turnaround strategy and incorporate its acquisition of Crayon, finalised in July.

With Crayon’s financial reporting still to be incorporated, the current set of results reflects just Zurich-HQ SoftwareOne’s performance.

North American trading, Microsoft incentive changes drag down top line

The results were mainly impacted by struggling North American sales and marketplace revenues, which the business attributed to Microsoft’s incentive changes and taking some business direct.

Meanwhile, North America dropped 30.4 per cent year-on-year. The company flagged sales execution as the core issue and teased a market-specific turnaround plan to address it.

“The North America plan which we announced in our Q1 update has been fully and successfully implemented,” commented Raphael Erb (pictured right), co-CEO of SoftwareOne during the company’s results presentation.

“One of our executive board members, Oliver Berdchtold, has spent most of his Q2 in North America, working with the leadership team over there.

“We’ve also hired specific experts focused on our multi-vendor business, which has been under pressure.

“For example, we’ve hired dedicated ISV experts and had global experts supporting North America.

“This has already shown some results with an improved renewal rate in multi-vendor.

“We also have new leadership coming in from Crayon and have announced the combined company leadership in North America.”

Erb also expects to see a reduced impact of Microsoft incentives in H2.

Marketplace fell more than 11 per cent year-on-year in constant currency (ccy), attributable largely to the hyperscaler.

EMEA trading was down 1.7 per cent, while LATAM dropped 5.2 per cent.

APAC sales buoy overall performance

The bright spot was APAC trading, with 13.2 per cent year-on-year growth ccy to CHF 83.6m, due largely to AWS sales.

Services revenue for the global business delivered a modest uptick of 2.4 per cent, setting the stage for a whopping margin increase of 44 per cent.

SoftwareOne’s services strategy in the region shone, with AWS services doubling in revenue.

Even with this diversification, Microsoft services now make up 37 per cent of revenue.

Combined 2026 guidance

SoftwareOne has laid out cautious guidance for the newly combined business with Crayon, telling investors it expects full-year 2025 revenues to come in flat against last year on a like-for-like constant currency basis.

Adjusted EBITDA margins are forecast to stay above 20 per cent, with a dividend payout ratio between 30 and 50 per cent of adjusted profit.

The co-CEOs described 2025 as a “transitional period” focused squarely on integration, but struck a more upbeat note on the second half of the year.

Growth is expected to return from Q3 onwards, helped by the fading impact of Microsoft’s enterprise agreement incentive changes, faster uptake of service-led offerings such as CSP, and early benefits from a go-to-market overhaul in North America.

“Overall, we are positive that the company will be back in growth mode in H2," said Erb.

“Based on what we see in the business, we are confident that most, if not all of the regions can achieve positive growth again in the second half and it’s certainly what we’re aiming for.”

“We are very much committed to growth in the back half of the year,” added co-CEO Melissa Mulholland (pictured left).

“On a full-year basis, of course, there is negative growth. And, when you add it together, it’s also important to mention that we are in an integration phase.

“So we are, of course, very focused on the cost synergies, but also the revenue synergies. But we are still coming together as a business.”

Read CRN’s key takeaways from the acquisition here.