Elisa Forsman: Good morning, everyone, and welcome to Verkkokauppa.com's Q3 2026 results presentation. My name is Elisa Forsman. I am the Head of Investor Relations, and I am joined here by our CEO, Panu Porkka, and our CFO, Jesper Blomster. As usual, we will start with the presentation by Panu, where he will go through the key highlights of our Q3 results and the drivers behind our numbers. We will then move on to the Q&A session with both Panu and Jesper. We have a few of our analysts joining us live in Helsinki, so we will take their questions first before moving on to the online questions. Just a reminder, if you want to ask a question, please type them into the question box on your webcast panel. I will then address them during the Q&A session. With that, I think it is time to get started. Panu, please go ahead.
Panu Porkka: Thank you, Elisa. Good morning also on my behalf, and welcome to our interim report presentation. Like Elisa said, there will be an open Q&A at the end of my presentation where Jesper will be joining with me, and we are available for the questions at that point. As always, I will start my presentation, first of all, with few words about the operating environment, mainly here in the Finnish market. Then we will jump into the report published this morning, some highlights from financials and also strategy execution, then market outlook, guidance, and key takeaways. The operating environment has stayed pretty much the same throughout the last couple of months. After the summer, we saw that there are some positive signs when looking at these leading indicators such as consumer confidence and consumers' confidence in own economics.
Panu Porkka: We still do not see any positive impact of that in the consumption as such. There seem to be uncertainties, energy prices, and inflation, interest rates. These seem to be still burdening the consumption in the Finnish market. On the other hand, we see that the B2B market has been more stable and the demand is more of a natural kind. Despite the consumer consumption not still picking up, we saw that we were able to record growth, which was in line with the market development. Growth 2.1%, again, mainly driven by our online parts of the business, which is fueled by our strategic key cornerstone, fast fulfillment. Fast delivery is growing as much as 27% again. Besides the Finnish market, second growth area, international sales. International businesses grew by over 40%, mainly successful due to the Swedish market and some Central European partnerships as well.
Panu Porkka: In the Finnish market, B2B was the key highlight, growing over 15%, while at the same time, the consumer demand was muted, and that part of the business decreased by 3%. One of the key focus areas throughout the last couple of years has been the margin, the underlying parts of the business. For the first time now since we have sold the consumer financing business, we were able to report actually an improvement in the gross margin, which yielded into the positive development in gross profit. We have been working rigorously on our category management with the profitability in mind. We have been optimizing our pricing. Dynamic pricing capabilities are on track. Commercial parts of the business are yielding positive results.
Panu Porkka: We have also been quite successful in certain well-time purchasing throughout the year, always trying to mitigate possible price increases to be able to sell the products through with a healthy margin. It is also good to mention at this point that already now we see the positive impact of our own brands, especially from the margin having a positive contribution in the company's overall margin development. From the P&L, growing volumes, at the same times improving margins and tight cost discipline leading into a clear comparable operating result improvement, 4.7% compared to 3.9% from the previous years. On a profitability level now 3.5%, so we are nicely on track towards our long-term targets. Inventory, we are on a healthy level.
Panu Porkka: At the beginning of the year, we made some decisions that we took an overstock in certain categories where we had the assumption that the prices will be increasing. Those decisions seem to be the right ones. We were able to sell those through. First of all, the inventory level is healthy, and secondly, we were able to sell them through to a nice, healthy margin. So inventory is now back on track, and we are looking ahead to the main part of the season coming in Q4. From financials also a solid performance. Operating cash flow was a positive one. If we take in consideration that the previous year figures have a one-off due to the sale of the consumer financing business of EUR 32.3 million, also a clear improvement in that.
Panu Porkka: A strong financial position from cash-wise equity ratio almost at 25%, so the first target already met at this point. The business continues to be investment light, and there are ways of distributing positive shareholder return. Today morning, the board resolved the third dividend installment of 0.049 euros, so thank you for all the investors. Also there is an ongoing share buyback program, the total amount of EUR 5 million. At the end of the quarter, the amount was EUR 3.9 million, so it is still ongoing as we speak. A few words about the strategy execution. We are successful taking our business abroad. We have been successful for many quarters now in a row. Again, growth over 40%, mainly due to the Sweden market growing by almost 100%. We are also quite proud that we have been developing the Swedish business further.
Panu Porkka: Now we were able to have the first next day deliveries already from the Finnish warehouses. We are taking that part of the strategy, the fast fulfillment, first steps also into the Swedish market. Also success in certain Central European marketplaces. Also at this point, it is good to mention that in all of those markets, we are quite successfully already introducing our high qualitative own brands, and this is a key growth and profitability component going forward the next couple of years. Fast delivery is continuing to grow and outperform the market, 27% growth. Even more important for me is that the customer base is growing. The customer base grew by 50%. What it means, more and more customers are adapting to this new way of shopping.
Panu Porkka: Our strategic mission, accelerate online shift through fast delivery, is really taking place, and I think we can already say that we have created a new norm of buying in the Finnish market. We expanded the fast delivery capabilities again by 100,000 additional consumers in the greater Helsinki area. Like said before, Swedish market we can now service, in some cases, with next day deliveries. We have actually met some of our targets already that we set ourselves by the end of 2028. We said that 50% of all online sales where we are offering fast deliveries should be with fast deliveries, and we have actually met that target already at half point. What do we expect out of the last quarter? Obviously, as every year, the Q4 is the main quarter for us.
Panu Porkka: It has the most important time of the year, the most important season of the year. Throughout the year, there have been early indicators that the consumer demand might be picking up because the confidence is starting to grow, but we have not yet seen that to have a positive push to the consumption as such. We do believe that increasing interest rates and the inflation, energy prices might be something that is still holding the consumption on a moderate level. We also see that our competitors are adding aggressivity into the pricing, but we are totally prepared for this to happen. As always, the last part of the season is also somewhat price-driven.
Panu Porkka: We know for certain that we have a scalable business model, we have an effective underlying business cost discipline in place, and we also see that we are the ones who is transforming the market at the moment. Therefore, no reason to revisit our guidance. We expect the year of 2026 to be a growth year in a perspective of revenue and comparable EBIT as well. What I would like you to remember from the Q3, it was a solid performance from the company. Somewhat subdued consumer consumption. Still, we have a clear number of growth initiatives and channels and segments where we can gain growth, even if the Finnish market is not in favor of consumption. Underlying business is really effective. We have healthy margins, healthy inventory turn, cost discipline in place, so we are able to improve profitability despite market difficulties.
Panu Porkka: Strategy is executed as follows, as the previous quarters as well. We are transforming the Finnish market, the way of consumer are behaving, and we are the preferred channel now, and we expect that to continue. We are distributing positive returns to our shareholders with our dividend and share buyback program, and we are well prepared for the most important time of the year, as always, Q4. Thank you all, and let's then start with the questions.
Elisa Forsman: All right. We are ready for the Q&A now, and as I mentioned, we will start with questions from the live audience. Arttu, please go ahead.
Arttu Heikura: Thank you. It is Arttu Heikura from Inderes. I have to double-check how fast the Finnish consumer electronics market grew in Q3, because you said that your group revenue grew 2%, but the consumer revenue declined for 3%. Which one is it?
Panu Porkka: We do not have not yet all categories in for the last month, but the last time we checked the categories that we reported to that segment were pretty much the same from development, plus, minus some decimals. So on the same level as the market.
Arttu Heikura: All right. Continuing on this, in previous quarters, you have outperformed the market, but this time, the development was in line with the market growth. Is there any specific reasons for this kind of development?
Panu Porkka: Well, first of all, I am not sure, is it 17, 16, or 15 months in a row gaining market share with this really unusual for a market leader such as us. There is always a month or two or a time period where somebody is investing more in marketing or somebody is investing more in margins because they wanted to defend the position or make sure that the inventory turns, because the market has not really been in favor of consumption this whole year. That is one of the reasons. Secondly, what we have said that we will always keep the profitability in mind. We will not do the craziest prices, because it does not make any sense to have a short-term revenue boost, but then you lose on availability for the most important part of the year, or you lose just profit.
Panu Porkka: We have always tried to balance and make the wise decisions.
Arttu Heikura: Okay. When I look at the intra-year figures in perspective of your consumer sales, there has been quite a negative trend. What is your view on the trading outlook for the upcoming months? Do you still see negative momentum in consumer sales, or have you seen any signs of demand picking up?
Panu Porkka: If you look on the general market and the general consumer activity, it seems to be somewhat cloudy to prognose anything. There are positive signs, but we are still expecting those positive signs to turn into consumption. We have not seen this to happen. Will it happen during Q4? Everybody is expecting or has expected that to happen. We do not know for certain. If you look at the previous year, we had in certain categories a push, first of all, because of the HD transition, and then also Windows 10 end of life, turning into Windows 11. So those obviously impacting those categories quite heavily. So it is not possible to have the same demand level or sales level in those categories. Those are both big categories. So that is also impacting.
Panu Porkka: Sometimes you just need to look slightly behind the figures to understand what is the general consumer behavior as such. But we still are expecting at certain point the consumption should start to pick up because the early indicators are indicating that.
Arttu Heikura: All right. Then about gross margin. In Q3, the gross margin was in line with the comparison period, even though you faced some headwind from the divestment of financing services. So I am asking how significant would the increase be if we exclude the impact of the divestment? So kind of underlying performance of your gross margin.
Jesper Blomster: We have not disclosed the exact figure of the consumer financing divestment, but we are talking about a notable increase, roughly a percentage point on the underlying gross margin improvement.
Arttu Heikura: Continuing on gross margin. Your peers have reported on some gross margin pressures due to increased component prices. Despite this, your underlying gross margin improved, in my view. How do you see your competitive position in the market from pricing point of view?
Panu Porkka: I can take that. I tried to shortly comment it in the presentation as well. I will go back to Q1 when we had the discussion about the Q1 inventory levels, and there I think I said that you can cross-examine me during Q3. Was it a good decision or not a good decision? Obviously, we understood and we estimated that there will be price increases, and we took in certain categories. It was not a risk. We did not believe it is a risk. We took overstock because we understood that the prices will increase 10%, 20% in certain categories, subcategories, even 30%. Well, now we can say that those were right decisions because we were able to have healthy margin despite the market intensifying, price points going down, and our competitors also investing more in marketing.
Panu Porkka: Because of these well-timed purchases, which we try to do all the time, we are now negotiating certain stock lots at the moment. This is a way we operate the business, have a strong cash position where we can act when we see there is a good possibility. As a market leader, as the one that has been providing growth for our suppliers, we are also in the first position when starting to negotiate. We are now basically utilizing our market position.
Arttu Heikura: Thank you.
Maria Wikström: Just getting a little bit of color how that does this memory chip price increases impact on consumer demand. I think probably the easiest way to analyze that is to look at the performance on the gaming sector specifically, because I guess they are products that you don't ultimately need, or maybe you do. Can you just give a little bit of color that how do different segments perform, I mean, post the price increases?
Panu Porkka: Yeah. I can give you color on that. Obviously, the subcategory with the deepest decline at the moment is components for us as well. Not because of availability, but because we have transported certain price increases that we have gotten from our suppliers into the end prices as well. So the demand is going down. Luckily, it's a subcategory for us. It's not in the top 15 of our categories, so it doesn't impact us as much as it impacts maybe some other players. Secondly, our market share gets higher the higher the technologies or the higher the price point of the PC, for example, is. What I want to explain is that the percentage or the part of the price of the component gets lower and lower. The most cheap products obviously have increased the most, but we are the strongest in the high range and the mid-range.
Panu Porkka: I think that's not impacting us as much as maybe those players who are really more into the low entry PCs, for example. Gaming, we are not that specifically strong in the gaming category. There are others who are also strong in that. So, that is a part of business where you maybe then wait when to update your gaming PC, because now the prices are somewhat up. They will go down at certain points. So those understand that maybe I will wait until next year. So that category is impacted heavily. If I look at the PC as such, I think more impact comes from the Windows 10 out of life than from components, for example. But that has not been impacted as strong as the components.
Panu Porkka: Then on the other hand, if you look at mobile, for example, that was one of the success stories of Q3. Well, there are also memories, and there's also technology where there's price increases. So there it hasn't had an impact as such. Everybody understands that when Apple launches new products, they are always more expensive than the last one. So that is part of the business.
Maria Wikström: Then during the quarter, Wolt announced that they will establish their own electronics. I mean, shop for some electronic products. Wolt is, of course, one of your partners for fast deliveries. What is your view that if this is going to take away some of your business, them going directly head-to-head with their customer?
Panu Porkka: Well, first of all, consumer electronics has been on that platform for almost 3 or 4 years. There have been operators who have been providing their products there. We have also tested that several times. We have tested that in the Baltics. We have tested that in the Turku area and Finnish market. We have tested that in Denmark also. So what is the underlying demand for certain categories? We have seen that it is quite narrowly concentrated on really just a few items or a short range of products. So the overlapping part is really, really small. For us, it is not the competitor. Like I said, it is one of the service providers which we have in our fulfillment.
Maria Wikström: Then I wanted a little bit more color on the very successful B2B growth during the quarter, whether this came from higher average tickets for existing clients, or did you manage to get new clients in, which would have driven the sales to over double-digit growth?
Panu Porkka: Both. The biggest part still is SMB segment. So being just a better supplier and a better service operator to these small, mid-size businesses is one point. I think we have improved on that businesses. We have also gained some mid-size to bigger companies as well as we are known to have really the best assortment and the best availability. We have warehouses here in the Finnish market, so we should be the number one supplier for mid-size businesses going into the big businesses as well. So coming from both. Fast deliveries also accelerate in that most of the businesses start to utilize because then you get instant device that you need for a business trip or for starting new employee or something gets broken. You do not want to wait a day until you start working again.
Maria Wikström: And then finally, you have started this next day deliveries in Sweden as well. Can you little bit give more color on the early adoption of this product in the Swedish market? And what kind of competition you have for next day deliveries in Sweden?
Panu Porkka: Well, I cannot count it in my fingers, but it is a small amount of deliveries that we have done towards the end of the quarter. The main point is that we are working to make it happen. We want to be more present with our offering on the Swedish market. The Swedish market is heavily offline penetrated. All of the big players, I don't know if it is 5 or top 10, all of them are brick-and-mortar operated or heavily focused. The competition is different. People are still going to the stores to get the items that they want. So we are now making our service levels better and better.
Panu Porkka: And we see now, hopefully during Q4, what is the impact on our total demand as we are offering something already next day, which is not typical for the Swedish market because you don't need to do it. You have the stores where you can pick it up. So we try to learn from that, and let's see what is the next step.
Maria Wikström: Thank you. I had no further questions.
Elisa Forsman: All right. The previous questions came from Maria Wikström from SEB. Let us move on to the online questions. We have a couple from our analysts. Miika-Aihamaki from DNB Carnegie had a similar question to Maria's about the component cost inflation, so we do not need to take that again. He has a second question on our sales growth last year. Sales growth was very strong last year in Q4, creating a tough comparable. What are the key drivers supporting growth for the remainder of this year? Is there still significant scope to expand penetration through international platforms?
Panu Porkka: Well, I can take that. We have several growth initiatives and growth potential. We have identified in a big picture that B2B is something that we believe we can do better. We can gain growth and momentum like during the third quarter. We do expect that to be one of the key growth drivers because that is not impacted by the consumer confidence. So obviously it makes also sense to invest focus on that because it is more stable from the underlying demand. Secondly, we are, as we speak, always taking our international business further. We are trying to identify new interesting markets and new interesting platforms, marketplaces where we can offer our products as we have built the business. We have built the integration, so that is quite fast to be on the market, as we now also understand more about the product market fit for us. That is second part.
Panu Porkka: We also believe that doing the commercial part of the business more wisely than our competitors, meaning negotiating products, stock lots, and certain price points, which the other ones maybe do not have, that we can still push the consumer market here in the Finnish landscape. We are prepared for the upcoming season. We understand that we will be investing. We have made things that we can do, invest in margin and in marketing spend as well. So we have a good plan, and we believe that that will be a solid to face the figures from previous year.
Elisa Forsman: Very good. Moving on to questions from Sanna Perälä from Nordea Markets. Coming back to the question about our Swedish next day deliveries. How do you manage to deliver to Sweden within 24 hours? When would building an own warehouse in Sweden be realistic?
Panu Porkka: Well, to the first question, we are a listed company, and our competitors don't give up their game plans for each market, so maybe I will not give away all the things that we have done. Also that's one of the reasons that we don't want to, in advance, tell all the steps that we are taking because our competitors might take advantage of that. To the second question, which is a really interesting one, what we have tried to tell is that we want to be wise. We really want to understand the end-to-end profitability of each channel, of each growth initiatives. I think that we can demonstrate that we have the knowledge because our underlying margin is improving, our profitability is proving, our cost efficiency is proving.
Panu Porkka: Despite building somewhat of complexity or somewhat gaining growth outside of markets where we are not strong, still these figures keep on continuing. I think that's a statement that we want to be wise, but we know what we do. That will be also the key driving philosophy in the Swedish market. What is the point that the return on investment is positive? Or what is the point where we understand that will be a growth accelerator, the physical presence in a market? That's basically calculation.
Panu Porkka: First we build the capabilities, then we try to understand the product market fit, and then we understand the end-to-end profitability, and then it's just driving the business. We are looking at that as we speak, but it's not the time yet.
Elisa Forsman: Very clear. Then continuing on international markets, maybe this one is for Jesper Blomster. Now that you're growing strongly in international markets, do you have any estimates for an FX neutral growth?
Jesper Blomster: No, we don't give market level or channel level revenue estimates.
Jesper Blomster: From that point of view, that's something that we don't disclose.
Elisa Forsman: Very clear. Then Sanna's next question is: Can you walk us through the changes in working capital and operating cash flow? Where did the changes versus last year stem from?
Jesper Blomster: Yeah, the biggest item is the consumer financing business divestment that we did in September 2025. The net impact was more than EUR 30 million, EUR 32 million on our Q3 cash flow. So that's the biggest single item. Another thing that we've done since that is discontinuing of the factoring arrangement that we had on our B2B receivables. So our accounts receivables have increased from that point of view. That happened in late Q1. So our account receivable have increased since then for natural reasons. We have those B2B receivables now in our own balance sheet, not in our partner's balance sheet. Those are the two key items on the working capital side.
Elisa Forsman: Very clear. Let me check. Yes, Sanna Perälä's last question is about, as you are pushing higher costs to prices, do you think this had a negative impact on demand in Q3?
Panu Porkka: Well, it is to a 100% certainty impossible to answer as we cannot A/B test the history, but we do believe that from a profitability point of view, I think we did the best we could.
Elisa Forsman: Good. Thank you. Do we have any more questions from the live audience? No? All right. We do not have any questions from the online audience either, so this brings us to the end of today's webcast. As always, if you have any further questions, please contact us at Investor Relations. Just a reminder, we will publish the presentation and the recording of this webcast on our investor website shortly after. Thank you for attending.
Panu Porkka: Thank you.
Jesper Blomster: Thank you.
