Signify reports third quarter sales of EUR 1.4 billion, operational profitability of 9.7% and a free cash flow of EUR 71 million

Core Insights - Signify reported third quarter sales of EUR 1.4 billion, with an operational profitability of 9.7% and free cash flow of EUR 71 million [1][9]. Financial Performance - Sales for Q3 2025 were EUR 1,407 million, reflecting a nominal sales decline of 8.4% and a comparable sales growth (CSG) of -3.9%, or -2.7% excluding the Conventional business [9]. - The adjusted EBITA margin was 9.7%, down from 10.5% in Q3 2024 [9]. - Net income decreased to EUR 76 million from EUR 108 million in Q3 2024 [9]. - Free cash flow was EUR 71 million, down from EUR 119 million in Q3 2024 [9]. Market Conditions - The market is facing challenges, including subdued demand and price pressure in Europe, along with a slower-than-expected US market [2]. - The OEM business has experienced reduced demand and price pressure, particularly due to the impact of two major customers [4]. Business Segments - The Consumer business continues to grow, driven by a strong brand and successful expansion of the Hue portfolio [3]. - The Professional segment performed well in project business and connected lighting, including agricultural lighting, with both segments delivering robust margins [3]. Future Outlook - The company expects comparable sales growth of -2.5% to -3.0%, or -1.0% to -1.5% excluding Conventional, and an adjusted EBITA margin of 9.1% to 9.6% [5][16]. - Free cash flow generation is anticipated to be around 7% of sales [5][16]. Sustainability Initiatives - Signify is ahead of schedule to achieve its 2025 target of reducing greenhouse gas emissions by 40% compared to the 2019 baseline [8]. - Circular revenues increased to 37%, surpassing the 2025 target of 32%, primarily from serviceable luminaires in the Professional business [10]. - Brighter lives revenues rose to 34%, exceeding the 2025 target of 32%, with contributions from both Professional and Consumer products [11]. Leadership and Diversity - The percentage of women in leadership positions remained at 27%, which does not align with the company's 2025 ambitions, prompting continued efforts to enhance diversity [12].