Monthly reporting would be great. It shouldn’t really be a problem for any company nowadays, as calculators are already so good they’re starting to have their own intelligence. Whipping up one earnings report shouldn’t even be challenging. Especially since Siili works with them.
P.S. I can’t sign the initiative myself because I don’t currently have it in my portfolio, but I urge everyone to sign Juha’s initiative. It benefits all shareholders. The link can be found a few messages above.
CEO Tomi Pienimäki’s review from today’s Annual General Meeting. 
I added a bit of Siili after the CEO’s review.
The mood seemed positive and I got the feeling that there is plenty of AI work to go around. We heard that a lot has already been implemented.
Tomi’s comment that Siili is focusing on fewer large key accounts instead of trying to grab all kinds of customers could signal that there is enough business from key accounts alone.
The balance sheet is strong, so many acquisition targets have been reviewed, and since the 2023–2026 target of 20% annual revenue growth requires acquisitions, I believe one is on the way. It could even be related to AI.
The CEO has firm faith that 2023 was an exception. Additionally, we are already well into the 2023–2026 target period, and the 20% revenue growth and 12% EBITA margin targets remain. It feels like the outlook isn’t that bad at all.
Those target period forecasts clearly exceed Inderes’ forecasts, and based on Inderes’ forecasts, the target price is 25% higher than the current share price.
This press release was just issued by the company. Any thoughts? 
Siili Solutions Plc Stock Exchange Release April 4, 2024 at 2:00 PM
Kenneth Lindfors, a member of the Management Team and Chief Commercial Officer of Siili Solutions Plc, will step down from his position and the Siili Management Team in April 2024.
Following the change, the heads of the business units will report directly to CEO Tomi Pienimäki. Siili is streamlining its Finnish operations, as in the future, the head of each Business Unit will be responsible for managing commercial activities.
“We want to thank Kenneth especially for developing Siili’s commercial expertise. He has provided us with valuable insight and perspective for raising the level of our offering and sales. We wish Kenneth all the best for the future,” says Siili’s CEO Tomi Pienimäki.
At least in Finland, my gut feeling is that AI work is still just small projects, PoCs, and Copilot trials. Some chatbots and so on. I don’t believe it’s a real, solid long-term business for consulting firms yet.
I would say that the way both the CEO and Siili have communicated about AI on LinkedIn indicates that customers are asking for it and it has brought in deals in an otherwise weak market. I think this can also be sensed from that annual general meeting video.
An advantage for Siili is also that the Chairman of the Board, Harry Brade, sits on Silo.ai’s board, and Silo.ai’s founder and Chairman of the Board, Tero Ojanperä, also sits on the board.
Tomi Pienimäki mentioned in some interview that he spars weekly with Harry and goes through things with other board members as needed.
Silo.ai is one of Europe’s fastest-growing bootstrapped AI houses. I very much agree with the opinions of Silo’s executive management.
Siili recently published this AI process of theirs, which is supposedly based on Google’s process.
In my opinion, Google’s approach to AI product development is different from what should be applied to a company’s processes and enterprise architecture.
In other words, if necessary, an enterprise architecture supporting AI must be considered, which will support all of the company’s future AI development. Hopefully, Siili has the expertise for this.
GenAI means processing all data.
AI does not just mean AI applications; instead, AI models are, when needed, part of normal system and process development projects.
AI is not an end in itself, and the goal is not to design standalone AI applications, but rather systems that support business, where a small part consists of AI or other ML models as needed.
This means that Siili’s AI team must have a couple of high-level experts for whom Transformer, Mamba, and GNN are second nature. These can spar with others.
However, I believe that Siili will develop in AI through projects. I know key people at Siili through work, and I have faith.
Good opening, and I don’t disagree. Almost every company the size of Siili now has an AI department or unit. They talk to the market about what resonates. I’ve seen others making deals in the market as well, but mostly small gigs. Hopefully, the business grows, but I bet not many consulting firms will be billing substantial revenue from it yet in 2024. Of course, every data and digital project is starting to be considered from an AI perspective, so it’s soon starting to be built-in.
As I understand it, Inderes’ materials have suggested that players particularly involved in software development with a larger share of the private sector are in a weak position, while those operating in the public and more traditional sectors are doing reasonably well this year. In other words, in light of Inde’s thoughts, this wouldn’t be Siili’s year.
Guidances in the industry look like this:
In the latest company report, Joni wrote this:
Market weakness has hit areas of expertise that are crucial for Siili, specifically software development and the automotive industry. Geographically, international revenue development turned to a 4% decline in Q4 based on our calculations (Q3’23 estimate +6%).
The stock seems to be quite modestly valued, and I wonder if these bleaker scenarios have already been factored in. As I understand it, Inderes is positive in the slightly longer term; is the assumption there that sooner or later, growth will inevitably come through the automotive sector, among others, and cost-cutting measures will start showing up on the bottom line?
Fortunately, there is cash, and there don’t seem to be major issues regarding profitability, and the customer base is also quite diverse, which one would believe provides some foundation for the business.
I can’t say much about the communications, but when it’s been felt in this thread as well that the communications aren’t sufficient or good enough, doesn’t that often suggest there might not be any good news in the near future? It’s probably easier to be open and direct if things seem to be going well? The guidance doesn’t really make me feel any more secure.
This was just some thinking out loud without any kind of expertise; of course, I’ve read quite a bit, but that’s not enough if you don’t know the industry (I don’t know any industry 
) and don’t understand that much about investing either. The range for what could happen here seems very “wide” for most people, which makes me perceive the company as a bit riskier than other players in the sector.
I am a Siili owner and have put quite a few euros into it.
OST:
AOT:
@Joni_Gronqvist provided his comments ahead of Siili publishing its Q1 business review next Wednesday.
Siili Solutions will release its Q1 business review on Wednesday at approximately 9:00 AM. Siili’s past year was challenging, but we expect performance to improve slightly going forward, supported by efficiency measures. In Q1, the comparison period remains challenging, and we expect revenue to have declined. Additionally, we expect profitability to have decreased compared to the comparison period but to have improved from the end of 2023.
SEB:n kommentti ennen “kevyttä osavuosikatsausta”:
Results Preview - Corporate
In our estimates, Q1 will mark the weakest organic growth in the current cycle. While we find the momentum should have remained at the Q4 level, the timing of Easter and a strong comparison period result in organic growth of -8.8%. However, the temporary lay-offs and reduced use of outsourcing should keep the EBITA margin at a decent 7.4%. For the full year, we have pencilled in 3.2% organic growth, meaning accelerating growth towards year-end. To retain confidence in the H2 story we are looking for signs of continued pick-up in leading indicators, such as tender activity and recruitment. Also, narrowing the relatively wide guidance range by raising the lower end should be a clear positive sign.
Siili typically has relatively sticky customer relationships and a large share of the annual revenue comes from existing clients, hence, existing customers’ confidence on the outlook is the key demand driver. We remain confident that driven by AI-based solutions the customers will at some point accelerate their next-gen digital investments, resulting in stronger demand growth for Siili. Internationalisation is also key to growth for Siili and we think the company could gradually build on the synergies stemming from the Supercharge acquisition and expand internationally with certain domains. We forecast 2025E growth of 10%.
Valued at 2024E EV/EBITDA of 5x we believe Siili is well below its fair value.
Indeed, Siili’s business review was published this morning:
https://ml-eu.globenewswire.com/Resource/Download/059cb259-677b-4a48-ba45-324b81e1a72f
Both revenue and adj. EBITA fell short of Joni’s forecasts:
Rev. 29.8 vs 31.8 MEUR
adj. EBITA 1.6 vs 2.4 MEUR
Here is Tomi’s interview, apologies for the release being delayed until closer to the evening. 
This first quarter was certainly a poor result. I wouldn’t have expected profitability to tank this badly after the savings measures. Personally, I’m waiting for the shareholder list at the start of May to see if management has been picking up shares, or if we haven’t hit rock bottom yet? In my view, the potential hasn’t gone anywhere, but whether it ever materializes remains to be seen; however, maintaining the guidance must signal that better times are ahead already this year. They also need to put the funds from the previous share issue to use… you’d think there would start to be high-quality acquisition targets available, even in terms of price.
I don’t think it’s worth starting to buy businesses just for the sake of pure capacity? Since it’s hard to find work even for our own talent.
@Isa_Hudd and @Joni_Gronqvist talked about Siili in Swedish.
Even some clumsy auto-captions could help someone like me who doesn’t really know Swedish. 
Well, this video was indeed made for the Inderes Nordic channel.
Contents: 00:00 Start 00:28 How Siili stands out 01:53 Geographical distribution 02:50 Tough quarters 04:36 Future outlook 07:17 Own savings solutions
Here are Joni’s comments on how Siili continued to increase its stake in Vala Group.
Siili has had some funny, visible ads – I like them, but hopefully they don’t use these too much for recruitment; for many, even five days is too much. 
There is a lot of talk about AI within the company, but it has been specifically highlighted how, for example, half of the employees have completed some generative AI certification. I don’t know how significant that is, or if it’s just one of those simple quick training courses you can finish fast?
Then it was also separately mentioned as a highlight of January–March when the AI-assisted Viki and Köpi radio show they worked on was awarded in the Grand One competition.
Both are great things, but are they ultimately quite minor, or does the company genuinely have the kind of approach that puts them at the forefront of IT service companies regarding AI? They did have this thing, too:
https://www.inderes.fi/analyst-comments/siili-perustaa-tekoalyavusteiseen-ohjelmistokehittamiseen-keskittyvan-yhtion
It’s just hard to get a handle on these AI things when all sorts of companies are talking about artificial intelligence and AI. Then even old-sounding automations are being called AI stuff, even if they’ve existed for fifteen years.
The business review also hyped it up (first page):
The analyst hasn’t really highlighted that AI side in that way, although the company itself has strongly brought up the opportunities it provides in its strategy, and the company aims for a leading position as a user of AI—but I suppose other companies in the sector do as well?
Just thinking out loud as an uninformed shareholder.
Here, CEO Tomi Pienimäki talks about his company as an investment.
The thread has gone quiet following the share price drop, so here are some AI-related thoughts from Siili’s perspective.
Siili regularly promotes its AI expertise on LinkedIn, which suggests a strong focus on it.
Siili seems to be primarily focusing on AI-assisted software development and its related processes. They recently hired someone who seems very competent as a Principal Consultant for that area.
However, the competition there is tough, as all IT service companies are aiming for the same thing.
In my opinion, the pace of development in the AI space has accelerated, even though NVIDIA generally seems to dominate the news. NVIDIA’s success is mainly a result of the development of actual AI models, and utilizing AI models will boost economic efficiency.
Therefore, I think investing in AI is sensible if done correctly.
In my view, development is rapid in the following areas:
Siili has mostly published very general AI articles that don’t really showcase the depth of AI expertise they might have.
I agree with Silo.ai’s blog post stating that an AI team requires at least one person with a very deep technical understanding of AI, plus someone capable of brainstorming AI use cases from a business perspective.
That person with deep AI and trend knowledge could train Siili’s staff, which might be more effective than off-the-shelf AI certificates.
I have practical experience in the effectiveness of sharing this kind of expertise within an IT company.
In my opinion, it is crucial to understand how different AI models process data internally, what their probability calculations are based on, and what kind of corporate data they can be applied to.
The use of the Transformer is growing, and its core concept is performing probability calculations on data relationships in a multidimensional space.
If you only have a minute to learn the principle of the Transformer, watch this:
That video explains the relationships of words in a multidimensional space. Words can be replaced by any data. Words or other data are converted into tokens, represented by vectors, before processing.
This is why the Transformer enables the processing of different types of data (multimodal). This is what GPT-4o’s features (image, speech, text) are based on.
In enterprise architecture, multimodality could, for example, enable the prediction of customer behavior through relationships between very different types of data. The same applies to improving business efficiency based on various data sources.
Collecting data solely for the needs of a single AI application is not sensible; data architecture must be considered from the perspective of the entire company’s business.
Therefore, Siili should, when necessary, also offer consulting for enterprise-level architecture and especially data architecture. Large companies, of course, already have their own enterprise architects, but an AI perspective from Siili’s side could be a competitive advantage.
Personally, I am not convinced when AI companies nowadays appoint a “former Agile coach” to lead the AI department. As a result, the discussion mostly revolves around how ChatGPT could be used to streamline company processes.
Siili’s investments on the AI front seem to be significant, and increasing its ownership stake in the Hungarian company Supercharge further supports this.
In light of its references, it appears to be working for major clients, including Pfizer, Ericsson, Telenor, Unilever, Vodafone, Santander, among others.