Pexip Holding ASA (PEXIP.OL) | Investment Case

1. Company Snapshot

1.a. Company Description

Pexip Holding ASA provides a video-first meeting platform worldwide.The company offers self-hosted software application and as-a-service deployment options for enterprise video conferencing, built on its proprietary Infinity technology.Its interoperability solutions are integrated into Microsoft Teams, Skype for Business, and Google Hangouts Gateway interop, a video system device registration and a meeting and calling service.

The company serves government, healthcare, education, finance, legal, and retail industries.Pexip Holding ASA was founded in 2011 and is headquartered in Oslo, Norway.

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1.b. Last Insights on PEXIP

Pexip Holding ASA faces challenges due to market volatility, with the pan-European STOXX Europe 600 Index declining by 1.24% amid concerns over AI-related stock valuations. Despite a robust Q3 2025 earnings report showing significant ARR growth and strategic partnerships, investors remain cautious. The company's growth prospects are influenced by a fluctuating economic environment, with European markets experiencing mixed performances. Insider activity and valuation metrics are being closely monitored, suggesting confidence from those closest to the company.

1.c. Company Highlights

Last Price	72.1
Change Percentage	15.54%
Open	67.4
Previous Close	62.4
Market Cap ( Millions)	7389
Volume	910031
Year High	72.1
Year Low	34
M A 50	59.96
M A 200	55.44

FCF Yield	3.83%
Dividend Yield	3.47%
ROE	11.37%
Debt / Equity	3.95%
Net Debt / EBIDTA	-91.91%
Price To Book	5.44
Price Earnings Ratio	42.87
Price To FCF	26.13
Price To sales	6.21
EV / EBITDA	23.5

2. Pexip's Q3 Earnings: Strong ARR Growth and Expanding Secure and Custom Business

Pexip's Q3 financial performance was robust, with a 12% year-over-year annual recurring revenue (ARR) growth. The company's EBITDA margin stood at 25%, and the free cash flow was NOK 29 million. Earnings per share (EPS) came in at '0.32', below estimates of '0.46'. Revenue growth is expected to be roughly in line with ARR growth, according to Øystein Hem, although some headwinds from currency fluctuations are anticipated.

Publication Date: Nov -21

                                    📋 Highlights
                                    ARR Growth:
                                                12% year-over-year annual recurring revenue (ARR) growth, with Secure and Custom contributing 44% of total ARR and growing 30% YoY.
Product Launch:
                                                Launched Pexip Connect for Google Meet hardware, enabling Teams interoperability, driven by market-leading position in video meeting interoperability.
Financial Performance:
                                                EBITDA margin at 25%, free cash flow of NOK 29 million, and Q4 ARR guidance of $124–127 million (2–5% growth, up from 3.6% in 2023).
Pricing Strategy:
                                                5% price increase in 2025 and expected similar hike in 2026, with $1 million projected revenue recovery from variable pricing shifts over 1–2 years.
Currency Impact:
                                                Stronger USD pressured revenue recognition, but ARR growth offset headwinds, with Q4 revenue growth aligned with ARR trends despite currency challenges.

                                

Segment Performance

The Secure and Custom business area grew 30% year-over-year and now constitutes 44% of the total ARR base, with new sales of NOK 1.6 million and existing customers growing by NOK 1.2 million. The Connected Spaces business area saw an increase of $400,000 in new sales, with most of the growth coming from Secure and Custom. Pexip launched a brand-new product, Pexip Connect for Google Meet hardware, enabling Google Meet hardware to connect to Teams meetings with excellent quality.

Guidance and Outlook

Pexip expects to end Q4 with an ARR in the range of $124 million to $127 million, reflecting the company's confidence in the continuation of the positive trend. The company has an ambition to deliver above Rule of 40 performance across ARR growth and EBITDA margin. Analysts estimate next year's revenue growth at 10.3%. The potential ARR for the Microsoft rollout of Teams for the U.S. government is significant, although the exact timing and deployment situations are hard to predict.

Valuation Metrics

With a P/E Ratio of 33.65 and an EV/EBITDA of 18.25, the market seems to have priced in a certain level of growth. The company's ROE stands at 11.37%, and ROIC is 10.37%. The Free Cash Flow Yield is 4.88%, indicating a decent return for investors. These metrics suggest that while Pexip's financial performance is strong, the stock's valuation is somewhat elevated, reflecting the market's expectations for future growth.

Operational Highlights

The company is investing in building capacity on the engineering side and increasing the number of salespeople in key geographies. Pexip is also dependent on Microsoft's rollout of Teams for Android, expected in Q1 2026. The translated live captions feature, covering 36 languages, and AI functionality for secure meetings are in demand, as seen in the use case for a U.K. court hearing.

3. NewsRoom

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.96%)

6. Segments

Self-hosted Software

Expected Growth: 7.5%

Pexip Holding ASA's self-hosted software growth is driven by increasing demand for secure, flexible, and scalable video conferencing solutions. Key drivers include rising remote work adoption, growing need for enterprise-grade security, and increasing adoption of cloud-based infrastructure. Additionally, Pexip's software integrates with popular platforms, expanding its addressable market.

Pexip As-a-service

Expected Growth: 8.5%

Pexip As-a-service growth driven by increasing demand for cloud-based video conferencing solutions, fueled by remote work adoption, digital transformation, and cost savings. Strong partnerships with Microsoft and Google, expanding into new markets, and innovative product offerings also contribute to the 8.5% growth.

7. Detailed Products

Pexip Infinity

A scalable and flexible video conferencing platform that enables organizations to deploy and manage video conferencing infrastructure

Pexip Service

A cloud-based video conferencing service that provides a scalable and secure platform for video meetings and collaboration

Pexip Fusion

A software-based video conferencing solution that enables organizations to integrate video conferencing with existing infrastructure

Pexip Insync

A meeting room solution that provides a seamless and intuitive video conferencing experience

8. Pexip Holding ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Pexip Holding ASA operates in a niche market, providing video conferencing solutions. While there are substitutes available, they are not as comprehensive as Pexip's offerings, reducing the threat of substitutes.

Bargaining Power Of Customers

Pexip's customers are largely enterprises and organizations, which have limited bargaining power due to the customized nature of Pexip's solutions.

Bargaining Power Of Suppliers

Pexip relies on a few key suppliers for its hardware and software components. While there are alternative suppliers available, Pexip's dependence on these suppliers gives them some bargaining power.

Threat Of New Entrants

The video conferencing market is attractive, and new entrants may be drawn to it. However, Pexip's established brand and customer base provide a barrier to entry, reducing the threat of new entrants.

Intensity Of Rivalry

The video conferencing market is highly competitive, with established players like Zoom, Microsoft, and Cisco. Pexip faces intense competition, which may lead to pricing pressures and reduced market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	1.17%
Debt Cost	4.33%
Equity Weight	98.83%
Equity Cost	9.33%
WACC	9.27%
Leverage	1.18%

11. Quality Control: Pexip Holding ASA passed 4 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Pexip

A-Score: 5.5/10

Value: 1.4

Growth: 7.1

Quality: 7.5

Yield: 3.8

Momentum: 9.5

Volatility: 3.7

1-Year Total Return ->

Fabasoft

A-Score: 5.3/10

Value: 4.0

Growth: 6.8

Quality: 7.1

Yield: 2.5

Momentum: 7.0

Volatility: 4.3

1-Year Total Return ->

Esker

A-Score: 4.2/10

Value: 0.0

Growth: 7.2

Quality: 6.8

Yield: 0.0

Momentum: 5.5

Volatility: 5.7

1-Year Total Return ->

Lectra

A-Score: 4.2/10

Value: 4.2

Growth: 5.8

Quality: 6.5

Yield: 1.9

Momentum: 2.5

Volatility: 4.0

1-Year Total Return ->

Cerillion

A-Score: 3.7/10

Value: 1.2

Growth: 5.8

Quality: 9.1

Yield: 1.2

Momentum: 2.5

Volatility: 2.3

1-Year Total Return ->

Swvl

A-Score: 2.9/10

Value: 6.8

Growth: 4.6

Quality: 3.0

Yield: 0.0

Momentum: 3.0

Volatility: 0.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

12.24%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

9.27%

Pexip Holding ASA - NO0010840507

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on PEXIP

1.c. Company Highlights

Average Quality

Stable Momentum

Medium Volatility

Earnings Beats

Revenues Beats

Strong Momentum

Lower Growth

Average Yield

Fairly Valued

Expensive

Better Quality

Revenues Miss

Earnings Miss

2. Pexip's Q3 Earnings: Strong ARR Growth and Expanding Secure and Custom Business

Segment Performance

Guidance and Outlook

Valuation Metrics

Operational Highlights

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.96%)

6. Segments

Self-hosted Software

Expected Growth: 7.5%

Pexip As-a-service

Expected Growth: 8.5%

7. Detailed Products

Pexip Infinity

Pexip Service

Pexip Fusion

Pexip Insync

8. Pexip Holding ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Pexip Holding ASA passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

72.1$

Current Price

72.1$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA