The following long article discusses Bittium alongside several other companies (including Saab, W5, Mildef, etc.). It’s recent enough that even the Indra deals are included.
Bittium (market cap EUR 1 bn) – Finnish secure communications specialist scales with NATO-level tactical networks
Bittium is a Finnish technology company specializing in secure communication and connectivity solutions for defense, public safety, critical infrastructure, and medical applications. In the current cycle, Bittium’s revenue has grown from EUR 82.5 million in 2022, when the operating result was near zero and the order backlog was approximately EUR 28 million, to EUR 85.2 million in 2024, with an order backlog of EUR 45 million and an operating profit of EUR 8.6 million, representing a 10.1% profitability. Bittium recently achieved a breakthrough in Spain in cooperation with Indra and raised its 2025 guidance to a revenue of EUR 116–120 million and an operating profit of EUR 19–21 million. This includes a small portion of the technology transfer agreement made with Indra, but the underlying earnings performance is also on an excellent track.
The growth of European defense budgets, accelerated by the war, has boosted Bittium’s Defense and Security business, as demand for tactical IP networks, software-defined radios, and secure government smartphones has increased among armed forces and security agencies, while its medical and R&D service operations have remained better protected from the conflict cycle. We believe this combination is significant. Part of the current growth is conflict-driven, as NATO and EU countries accelerate the modernization of tactical networks and command and control systems in the short term, but much of the demand is strategic and related to multi-year programs aimed at strengthening command, control, and communications rather than just the immediate tempo of the war. Together with cost-cutting measures and a refocused strategy, this improves Bittium’s potential for growth and profitability improvement as tactical networks modernize.
We see the current valuation as containing aggressive expectations even after the Indra deal. Based on the 2025 guidance, the EV/EBIT for Bittium’s Defense and Security segment is approximately 45-50x (estimated based on the group’s current valuation), so the company would need to achieve exceptionally large profits in the defense sector in the near term for the valuation multiple to look comfortable. Since Bittium currently appears to have a solid technological lead over major competitors thanks to its highly capable tactical IP networks and Tough SDR radios compatible with ESSOR waveforms, it could achieve significant market share in the coming years and produce the required results. The Indra deal in Spain proves that Bittium has the potential to beat even “national champions,” so the outlook is excellent. It remains to be seen whether it is enough to justify a market capitalization of EUR 1 billion.
Of course, for those who have followed the company more closely, there shouldn’t be much new information.
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