Flowscape released its Q1 results today, and the report offered fairly expected figures. Regarding new ARR, sales picked up slightly from the last quarter of the year, now standing at approximately 1.6 MSEK, and overall ARR grew by over 10% compared to a year ago. In terms of profitability, it remained at the Q4 level, meaning at this rate, the company’s profit will be about triple compared to last year. Today the share price closed up about 10%, and at the current valuation, the P/E ratio is around 13, which is quite moderate.
The CEO’s review focused largely on discussing the impacts of AI. During the early part of the year, the company made the largest product launch in its history, aimed at leveraging AI. The company believes it is well-protected against the negative effects of AI due to the complexity of its software. In addition to software, the service consists of numerous integrations, sensors, building automation, and other physical systems.
The software release should also bring much-needed cross-selling potential to existing customers, so now that the sales organization and offering have been strengthened over the past year, the path should be open for even greater growth.
I personally intend to continue buying shares even at these levels. The company’s profitability is at a good level and the ARR is distributed across numerous customers; as the company is also debt-free, the risks are relatively small.