Investing.com — Bang & Olufsen cut its financial outlook and withdrew its midterm guidance after weaker-than-expected sales of a new product, while warning that geopolitical tensions and economic uncertainty could weigh on the rest of the financial year.
The company’s shares tumbled nearly 10% in early Copenhagen trading.
The Danish consumer electronics group said late Monday that fiscal third-quarter revenue fell short of expectations, driven by disappointing demand for its Beosound Premiere soundbar.
“Q3 2025/26 revenue came in below expectations. While the newly launched earpieces Beo Grace performed as expected, the sales performance of Beosound Premiere was significantly lower-than-anticipated,” it said in the release.
“In addition, armed conflicts, geopolitical tension and economic uncertainty have intensified and are expected to impact the remainder of the financial year.”
The company’s revenue came in at 621 million Danish kroner ($96.5 million), down 1.7% from a year earlier and below the 668 million kroner forecast in a FactSet poll. Adjusted earnings before interest and taxes (EBIT) totaled 12 million kroner, missing expectations of 22 million kroner and resulting in a margin of 1.9%.
Like-for-like sell-out growth rose 1% year over year in the third quarter, while product revenue came in at 560 million kroner, down 0.2%, or up 3.1% in local currency terms.
Gross margin improved to 57.5%, up 2.1 percentage points, and free cash flow totaled 22 million kroner for the quarter.
For the full year, the company now expects revenue growth in local currencies to range from flat to a 3% decline. Free cash flow is projected between negative 150 million and negative 200 million kroner, while the EBIT margin before special items is seen between minus 1% and minus 3%.
This compares with prior guidance for revenue growth of 1% to 5%, free cash flow of negative 50 million to negative 100 million kroner, and an EBIT margin range of 1% to minus 3%.
The company said its outlook remains subject to uncertainty tied to consumer sentiment, as well as geopolitical and economic risks, including armed conflicts and global trade tensions.
“Our commercial operating model, specifically the coordination between marketing investments, retail execution and product launches, requires strengthening. This is the process we initiated in January, and it is not only a near-term priority; it is key to unlocking Bang & Olufsen’s full potential over the medium and long term,” said Juha Christensen, chairman of the company’s board.
Bang & Olufsen is also in the process of appointing a new chief executive after Kristian Tear stepped down in January, with the search ongoing and an announcement expected in the coming months.
The company is scheduled to release its full nine-month results on April 16.