Reliable operations in the defense sector as part of Gofore: The authority renewed Huld’s corporate security clearance certificate 
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Joni has written preview comments as Gofore prepares to release its Q1 report on Wednesday, April 29th 
We expect the company’s revenue to have grown strongly during the quarter, driven by completed acquisitions, although we estimate that organic development has remained moderate. We forecast profitability to have improved from the comparison period, supported by efficiency measures and a better utilization rate. In the report, our attention will be focused particularly on market commentary regarding the pick-up in private sector demand and the organic turnaround in the DACH region.
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The January–March 2026 interim report is fresh out of the oven 
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Joni interviewed Gofore’s CEO @MIkael_Nylund about the Q1 results
Topics:
00:00 Introduction
00:42 Q1 highlights
02:45 Organic growth
04:24 Profitability development
07:16 Costs on lower lines
08:13 Contract wins
11:04 Sales pipeline
11:41 Market situation
14:43 Q2 growth and earnings drivers
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Here is Joni’s company report on Gofore after Q1
We reiterate our Buy recommendation for Gofore with a target price of EUR 14.5. Gofore’s revenue returned to growth for the first time in a while, but profitability was weak for the company in Q1. Gofore’s market comments remained cautiously positive, and the company is currently investing in growth, which will support gradually improving profitability. Overall, the stock’s risk-reward ratio remains very attractive, especially looking towards next year.
Quoted from the report:
Due to Gofore’s strong performance, valuation multiples have historically been at very high levels of EV/EBIT 13x–22x, averaging 15x over the last 5 years. However, in our view, growth company valuations were still partly in a bubble in 2021, supported by zero interest rates. Due to weaker operational performance and a share price decline, the valuation has decreased significantly. Additionally, at the beginning of the year, the stock has been weighed down by the threat of AI disruption feared by investors, which has, however, been operationally known in the IT services sector for a couple of years. In our opinion, this disruption threat is exaggerated in Gofore’s case. The 2026e EV/EBIT and P/E multiples are 10x and 15x, and the corresponding 2027 multiples are 8x and 11x. In absolute terms, we believe valuation multiples are very attractive, especially looking ahead to next year.
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Mammu Kaario from the Board of Directors has purchased 50k worth of shares. It’s nice to see that even the insiders see potential in the stock at these prices. Gofore Oyj - Managers’ Transactions - Kaario - Inderes
Edit. These seem to be the member’s first shares, by the way.
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The April business review has been published:
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Here are Joni’s comments regarding Gofore’s April and a bit more.
Gofore published its April business review on Monday. The company’s revenue grew strongly, driven by acquisitions, and was well in line with our forecast. We estimate that organic revenue growth was slight, consistent with the beginning of the year. During the month, the company also announced two new public sector contract wins and provided a positive update on the progress of the Esentri integration. These news items contribute to supporting our growth expectations for the current year. As the figures met our expectations well, the review does not cause significant changes to our forecasts.
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Points on Gofore and the IT Services Sector
The IT services sector, and Gofore in particular, currently faces significant operational risks that warrant caution. On the other hand, the sharp correction in the stock price and the current valuation levels create a situation where the worst threats may already be priced in.
Here is an assessment of the company’s current situation, risks, and potential:
1. Why do I see significant risk in the industry and the company?
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Stalling Organic Growth: When looking beneath the surface of Gofore’s recent figures, it’s notable that the strong 28% revenue growth in April is almost entirely attributable to acquisitions (the Esentri deal). The company’s organic growth—the inherent pulling power of the existing business—was only around one percent. This is a clear signal that scraping together new business from the market is currently very difficult.
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Margin Squeeze: Q1 results showed that the company’s profitability is soft. A fierce price war is underway in the IT sector, with customers (both corporate and public sector) demanding lower hourly rates. Since expert salaries and fixed costs do not flex downward in the same proportion, this development directly hits margins.
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Business Model Disruption from AI: Artificial Intelligence (AI) is making coding and routine tasks exponentially more efficient. The greatest long-term risk for IT service houses relates to the traditional business model based on billable hours. If projects can be completed, say, twice as fast in the future with the help of AI, the number of billable hours will decrease. The industry must be able to change its pricing models, which creates significant uncertainty.
2. Why current pricing might still offer a buying opportunity?
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The Valuation Bubble has Already Burst: During the zero-interest peak of 2021, growth companies and Gofore were priced at irrational multiples (EV/EBIT over 22x). Now the share price has been pushed down to around 11 euros, meaning that the projected 2026 EV/EBIT is only about 10x. This absolute multiple is very low compared to the company’s historical quality. The market seems to have already baked in AI disruption and margin erosion with very pessimistic assumptions.
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Strong Insider Signal: I consider it a very significant sign that a board member (Mammu Kaario) recently went shopping in the market with a 50,000 euro investment. Insiders may sell their shares for many different reasons, but they only buy them with their own money from the stock exchange when they believe the price is too cheap relative to the company’s true value and future prospects.
Summary
Gofore is a high-quality company currently suffering from cyclical pressure across the IT services sector and structural uncertainty. If you trust that the company can navigate through the AI transition and leverage, for example, its strong position in the defense and public sectors, the current 10x EV/EBIT multiple for 2026 offers an attractive risk-reward ratio for a long-term portfolio.
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Thanks. Good summary. I agree with almost everything.
Perhaps I wouldn’t consider an insider purchase by a single board member to be a highly significant sign. Is it a large stake relative to their total wealth, what is this person’s competence in terms of foresight, do they have a deeper understanding of AI, industry development, etc. - the person likely sees from the inside that operations will be stable for the next few quarters, but one can see that from the outside as well.
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I don’t know what kind of value a direct LLM message like that provides without any personal reflection. It’s better to read Inderes’ analyses and listen to interviews (both Gofore’s and their competitors’). None of the companies in the sector have yet solved the problem of how to transition in a controlled manner from hourly billing to value-based (result-based) sales. Or, it could be that the companies see the transition as unnecessary.
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Since there is no solution, the hourly rate should go up, but based on what? A return to fixed pricing where potential risks of losses can now be offset with AI? The productivity leap is the same for everyone, so the game doesn’t change. If the work can be done faster, customers will instead commission those projects that were previously left in the drawer. Some have also moved from basic full-stack to regulated industries where “kiddies” (jonnet) can’t just wing it because laws and regulations don’t allow it.
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Agentic development (far beyond the hype) has moved into all industries, including regulated ones. Where necessary, agents are being run on local LLMs and machines that are not connected to the internet.
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By regulated, I meant the space, defense, and medical sectors, where development and change management are safety-critical. In these fields, code generation is not the bottleneck, and processes are not handed over to LLMs for good reason. Traditional automation is prevalent there, but it has its limits; the rest depends on processes where humans verify everything produced at several different stages.
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The May review has just been published Have a great summer, everyone on the forum! Our next review will be for June, which we will publish in July.
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