A bit off-topic, but Elektrobit acts as a subcontractor for the automotive industry in projects where Qt technology has been used. So Elektrobit doesn’t directly have anything to do with Qt.
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Yes, EB is a so-called tier2 supplier. The parent company, Conti, is categorized as a tier1 supplier. Above tier1 then sits the OEM, for example, Volkswagen.
EB is both a product and a service company. In the product catalog, the offering is mainly operating system, communication, and virtualization-focused. On the service side, customer needs and wishes are adapted to, and Qt’s technology may appear there. Qt is a very popular technology in automotive software, fitting well into many use cases. Technologically, this applies especially to boot2qt-type low-level applications for which fast startup time is key. But as KDE and many applications prove, Qt is suitable for both system and application development.
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Insider Information: Qt’s Recommended Public Cash Offer for I.A.R. Systems Group
The offer consideration is SEK 180 for each IAR Share, valuing IAR at approximately SEK 2,293 million or approximately EUR 204 million[1] based on the outstanding Shares.[2]
The offer consideration includes a premium of approximately 63.6 percent compared to the three-month volume-weighted average price of IAR’s Share (SEK 110.1) on Nasdaq Stockholm before the announcement of the Offer.
Qt will finance the Offer with cash and debt.
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Looks quite promising. IAR Systems has popped up as a name now and then over the years.
Qt will host an information session for investors and analysts on July 4, 2025, from 11 AM to 12 PM Finnish time. During the event, CEO Juha Varelius and CFO Jouni Lintunen will present the acquisition offer, followed by a Q&A session. You can register for the webcast at Qt Group - Investor and analyst briefing.
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In the spirit of the national team, it does good for the soul that Swedish companies are bought by us 
A high premium, hopefully it’s a well-considered deal. Trust in the management and owners is strong.
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Analyst’s comments regarding the tender offer news. 
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The multiples are quite okay with last year’s figures at 13.6x EV/EBITDA. Financing seems to be over 50% debt, so the proforma cash flow yield for equity in the deal could well be at the +10-17% level without synergies or growth or cross-selling opportunities. Thus, broadly speaking, a very promising new growth prospect, and ample cash gets back to work.
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Will the deal result in a dual listing in Sweden?
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I have compiled the key takeaways from the press conference and a condensed Q&A. Here you go. The same can also be found on Inderes.fi 
IAR Solutions in a nutshell
- A leading player in the market for secure, reliable, and high-quality software for embedded systems, with over 40 years of experience (founded in 1983).
- IAR’s products support application development in many sectors. Key areas include automotive, industrial automation, IoT, MedTech, defense, and security sectors.
- IAR supports 15,000 devices from over 70 semiconductor manufacturers and employs 230 people across 14 offices in North America, Europe, and Asia.
- ARR (share of recurring revenue) 62% of revenue in 2024.
Why does the acquisition support Qt Group’s strategy?
- Because the companies operate in the same fields, they have a number of overlapping customers and also many new customer accounts. The acquisition expands Qt’s target market.
- IAR’s products are included earlier in the product development lifecycle, which enables better customer engagement.
- The acquisition gives Qt a stronger foothold in the MCU market. Qt is very small in this market, while IAR is one of the leading players.
- Opportunity for cross-selling: quality assurance tools (Axivion, Squish) to IAR’s customers. Qt can offer a “One-stop-shop” approach to software development. Qt wants to be a multi-product company.
- IAR is just beginning its transition from a license-based business to a subscription model (SaaS). Qt has gone through this transformation process over the past three years and can offer IAR experience and support in implementing this change.
- Stronger global customer support and customer-centric service by combining sales and customer relationship functions.
Analyst Q&A (condensed version)
Questioners: Matti Riikonen (DNB Carnegie) and Jaakko Tyrväinen (SEB)
Why now? Speculation about the compatibility of Qt and IAR has been ongoing for years. Why is now the right time to act, instead of the deal being executed earlier?
Qt has been following IAR for a long time. Firstly, such arrangements require the willingness of both parties, and the time is now ripe for that. Additionally, after integrating two previous acquisitions (froglogic, Axivion), Qt is now in a position where it is ready to take the next step. The timing is now right for the company.
IAR has started the transition to a SaaS model. Isn’t it true that Qt still essentially sells licenses with a continuous model, and you haven’t fully transitioned to a SaaS model? How do you practically manage a company that sells with both license and SaaS models? Do these two models need to be combined into a single service model at some point?
When Qt acquired Axivion and froglogic, the idea was that each product must be good enough as a standalone product. All Qt products have common, but also separate, customers. The important thing is that purchasing is as easy as possible for the customer in all respects. Qt designs pricing and contract models so that buying different products is easy for the customer. Varelius stated that in the long run, pricing models must come closer to each other.
How large is the overlapping customer base between you and IAR? How many IAR customers would be new to Qt and vice versa?
The company cannot provide an exact number at this point. However, Varelius stated that IAR operates in industries where Axivion’s certified quality requirement-based products are also strong — such as the automotive and defense industries. This means that there are overlapping customers, but new Qt customers will also emerge alongside them.
Could you illustrate how much stronger IAR is in the MCU market? How many customers do they have compared to Qt?
Qt cannot give precise figures, but Qt is very small (tiny tiny tiny) in the MCU market — IAR is a giant compared to Qt. Qt is significantly smaller.
Could you summarize IAR’s core products in a few words? What value do they offer customers and how close are they to Qt’s current products?
IAR sells compilers. So they talk to customers when they are planning to start a new project and are choosing hardware. They also have a development environment as part of that toolset, as well as some related security solutions. So they operate at the early stage of the development lifecycle.
After that, design begins to consider what the design should look like, then actual software development follows. And throughout this process, static code analysis is involved, then possibly architecture testing, and finally, deployment and functional testing of how everything actually works. So IAR operates at this early stage for microcontrollers with its compilers, IDE, and security solutions. That’s their place.
And from there, Qt’s products continue. This would therefore be a complementary product – one more step towards the customer being able to get more from one place. IAR is very strong in environments where certifications are required. As I mentioned, functional safety and certain critical software components that require certificates – they are very strong there. Qt’s Axivion products are also very strong in these areas. And these customers – these are the industries where Qt also operates. Of course, we also have common customers, but we have many customers who are not common but operate in the same markets. So this expands the target market for both companies.
So Qt aims to expand your value chain position in the embedded systems market?
Yes, you could say that.
What is the reason for IAR’s slowed growth in recent years, and how does Qt plan to accelerate IAR’s growth? Or is the idea that IAR accelerates the growth of Qt’s current products?
Qt believes that the acquisition supports mutual growth. The company sees that their quality assurance tools (Axivion, Squish) are particularly interesting to IAR’s customers. For Qt, the company sees that a broader service offering and a wider offering to new customers will accelerate growth. IAR published a new strategy last year, and Qt finds their long-term growth targets credible.
IAR aims (given at the end of 2024) for 20% growth and at least 20% operating profit margin over a 3-5 year horizon.
Does Qt have a view on how IAR’s transition to a subscription-based model has progressed — how have customers reacted to it?
IAR is a public company, so Qt has the same information as other shareholders and cannot go into more specific details. Qt has gone through the same change. For the company, the transition to a subscription model took 3-4 years, and ultimately about 10% of the customer base remained on the old model, as the company estimated at the beginning of the transition. Qt expects IAR’s change to also take several years but succeed — because the subscription model is prevalent in the embedded software market.
If the acquisition goes through, would Qt issue new guidance? And what about the longer-term revenue and profitability targets — would that change them?
This is difficult to comment on at this point, and Qt is keeping the old guidance unchanged for now. If the acquisition is completed, the company will re-evaluate the matter.
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LG gave preliminary information about Q2 expectations. Uncertainty in consumer demand in Q2, e.g., TVs are selling poorly
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It’s a pleasantly investor-friendly acquisition, as I.A.R.'s materials are nicely publicly available as a listed company. Since no one has yet made selections from these public reports (Antti has, of course, mentioned some of these in his initial comment), I’ll include a few screenshots below so that anyone can get a quick overview of what Qt is acquiring.
Excerpt from the Q1/2025 report:
Growth in gross revenue amounted to 3.7% for the quarter, despite difficult comparative figures in Q1 2024, including two major transactions. Targeted initiatives led to a noteworthy decrease in churn in all regions, and our recurring revenue from support and update agreements (SUA) grew 15%. We also saw a 17% increase in new customer sales compared with the year-earlier period, together with a three-fold increase in the number of new customers. These are clear indicators that our value offering is continuing to gain traction in the embedded systems market.
The growth figure compared to the Q1 quarter a year ago was soft, but the justifications (large deals in the comparison period) seem acceptable. Regional variation appears to be enormous, probably precisely due to large one-off deals?
Adjusted for foreign exchange effects, growth was -11.2% in EMEA, 45.8% in APAC and -21.2% in North America.
Growth has also been historically quite inevitable, even though this company couldn’t do anything about the COVID-19 stumble. Outside of the image below (from the 2024 annual report), it should be noted that growth in the previous decade was also quite decent.
Profitability appears to have developed positively over the past 10 years, and perhaps in summary, one could say that “typical strong profitability” has meant an operating profit (EBIT) of over 25 percent for this company. Of course, during the COVID years, it even dropped below twenty, but even then, the primary reason was likely the integration difficulties of a weak acquisition (the Secure Thingz Ltd. acquisition in 2018).
Somewhere I saw a note that the transition to a subscription model could weigh on both revenue and profitability in the short term.
A couple of general images and text snippets from the 2024 annual report:
The growth target is ambitious, but no improvement in profitability is expected:
The road ahead
An outlook for the year ahead is uniquely uncertain, but the remodeled IAR is built on solid foundations. We have consistently demonstrated our ability to drive growth while maintaining a robust balance sheet. Our long-term objectives are clear: in the next three to five years, we intend to achieve 20 percent annual growth, whille maintaining an operating margin of at least 20 percent, driven by our shift to the subscription-based business model, organic expansion and strategic acquisitions where applicable.This is an exciting time for IAR — a period of transformation, growth, and innovation. We have always been at the forefront of technological development, and with our new strategy, we’re reinforcing that position. I am confident that the changes we are implementing will lay the foundation for a stronger, more agile IAR, ready to seize the opportunities ahead.
And here’s J&J’s general slide:
On average, I am relatively skeptical about acquisitions. Too often, 1+1 does not equal three, even though this is usually promised. And it’s too common for the sum to be even less than two.
From this perspective (and noting my complete novice status regarding the target company’s technology), I summarize my thoughts on I.A.R.:
- Has demonstrated the ability for long-term growth and good profitability
- In excellent financial condition
- Appears to remain faithful to its strategy in the long term
- Very broad, diversified, and well-known customer base
- Invests significantly and long-term in its R&D activities
And my thoughts on the acquisition:
- From a product portfolio perspective, the merger seems sensible
- Other justifications for the acquisition (synergies of subscription models, common customers, different parts of the same value chain, etc.) seem credible
- I would describe the target’s valuation multiples as neutral despite the somewhat high premium
- Integrations tend to consume time, money, and key personnel, so I don’t expect any quick wins
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Here’s an article, paywall
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Will this bring potential additional revenue for Qt? LG’s streaming services for Kia electric cars in Europe.
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From KL’s news feed today (23.7):
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Antti anticipates that the Q2 result will be superficially ugly and another negative for the rest of the year.
We forecast Qt’s revenue to have remained practically flat at EUR 53.5 million in Q2. A weakened US dollar clearly weighs on euro-denominated revenue, but even currency-adjusted, we estimate the period’s revenue growth to have been a modest 5%.
[…]
We forecast Qt’s adjusted operating profit (EBITA) to have weakened to EUR 15.2 million or 28.3% of revenue (Q2’24: 34.7%).
[…]
With the resolution of tariff levels between the EU and the US, we still see conditions for the gradual launch of deferred product development projects towards the end of the year. The situation may still require a new profit warning from the company (current: comparable revenue growth of 10-20% y/y and 30-40% EBITA-% in 2025), but if this materializes, we estimate it would only occur in connection with the Q3 or Q4 earnings release.
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This wasn’t here yet, so let’s remind everyone that the Qt live stream starts in about fifteen minutes! 
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It didn’t quite hit the mark. Does the risk of a negative profit warning increase towards the end of the year?
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Second Quarter 2025: Revenue decreased slightly, earnings guidance unchanged
April-June 2025
- Revenue decreased by 3.9 percent to EUR 51.2 million (EUR 53.3 million). The impact of exchange rates on the comparable period’s revenue was -EUR 1.9 million, and revenue decreased by 0.5 percent in comparable currencies.
- Operating profit (EBITA) was EUR 11.6 million (EUR 18.5 million), or 22.7 percent (34.7%) of revenue.
- Operating profit (EBIT) was EUR 9.6 million (EUR 16.5 million), or 18.8 percent (31.0%) of revenue.
- Earnings per share were EUR 0.27 (EUR 0.53).
January-June 2025
- Revenue increased by 0.1 percent to EUR 98.5 million (EUR 98.4 million). The impact of exchange rates on the comparable period’s revenue was -EUR 1.3 million, and revenue increased by 1.4 percent in comparable currencies.
- Operating profit (EBITA) was EUR 20.1 million (EUR 29.5 million), or 20.4 percent (30.0%) of revenue.
- Operating profit (EBIT) was EUR 16.1 million (EUR 25.5 million), or 16.3 percent (25.9%) of revenue.
- Earnings per share were EUR 0.46 (EUR 0.83).
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It might be difficult to reach the lower bound of 10% annual revenue growth, and at this rate, that targeted 30% profit margin is also a pipe dream.
Edit. Now it would be interesting to hear about the development of market shares. Is this just economic weakness, or have we captured a smaller share of the market than before?
Edit 2: This sentence: “We are keeping the full-year earnings guidance unchanged.”, sounds like it will still change.
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Is this a growth company now? According to the numbers, a declining smokestack.
Terrible result compared to expectations.
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