ebitda
138–144.6 $million
FY 2026
official guidance
GAMMA COMMUNICATIONS PLC
Last · LSE£11.59+0.03 (+0.26%)stale · yahoo · 144h ago
Market cap£1.0B89.1M sh
P/E · TTM16.8fwd 11.6 · eps 0.69
Beta0.89vs S&P 500
Div yield1.92%annual · TTM
52w range
£6.87£12.07
Volume2.0Msession
| Revenue | £645.8M |
|---|---|
| Operating income | £90.9M |
| Net income | £64.9M |
| Free cash flow | £83.6M |
| Operating margin | 14.1% |
| Net margin | 10.0% |
| Return on equity | 16.8% |
| Period | 2025 |
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OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
BuyHoldSell
Attractive valuation and cash returns are offset by limited near-term earnings growth and several unproven expansion assumptions.
Hold: Gamma delivered a strong FY25, with adjusted EBITDA up to £141.7m, adjusted EPS of 94.5p, 93% cash conversion and £125m of planned shareholder returns over 2026-27.
Germany is growing organically at roughly 13-15% and the valuation appears low, but FY26 guidance is only £138-144.6m EBITDA and 90-96.6p EPS, while UK SME and Enterprise remain exposed to PSTN migration, pricing pressure and weak macro conditions.
Themes
- Germany Growth
- Uk Sme
- Pstn Switch Off
- Service Provider Expansion
- Enterprise Pipeline
- Ethernet Pricing
Near term
Germany should remain the main growth engine, with Placetel and Starface reportedly growing 13-15% year-on-year and contributing £78.4m of FY25 gross profit.
Enterprise wins signed in Q4 2025 should begin contributing, mainly in the second half of FY26; larger European tenders may not convert until 2027.
The £42.5m FY26 share buyback is already underway, with the dividend held at 22.2p.
FY26 earnings face a further roughly £4m gross-profit headwind from PSTN migration and a £3m Ethernet-pricing impact, partly offset by £7m of run-rate cost savings.
Longer term
Germany offers the clearest structural growth opportunity, but the pre-acquisition underlying business grew only around 4-5%; reported growth is heavily supported by Starface and Placetel.
Service Provider expansion into 30 countries and APAC could materially enlarge the addressable market, but revenue wins outside the UK have not yet been demonstrated.
Cloud migration remains a sizeable opportunity: management estimates 40% of UK and 80% of German businesses still use hardware-based phone systems.
Gamma’s network, regulatory compliance and channel reach provide defensibility against software-only and AI competitors, although the moat depends on maintaining hyperscaler and partner relationships.
Management targets higher EBITDA margins through rationalisation, offshoring, acquisition synergies and AI, but provided no quantified margin target.
Red flags
UK SME represents 42% of group gross profit and is expected to remain below its potential 4-5% growth rate because of price pressure, lower seat additions, higher churn and weaker business formation.
Ethernet overbuild is causing ongoing pricing pressure; management expects consolidation eventually but conceded that pricing stability is probably not coming in 2026.
Service Provider’s international growth case is still largely prospective. Management acknowledged that the infrastructure is now built and the test is whether it can fill capacity and generate revenue during 2026-27.
AI monetisation remains immaterial in scale: the German AI voice agent generates about €50,000 per month, despite reported 30% month-on-month growth.
Reported German growth includes acquired businesses, while the legacy German operation grew only around 4-5%; investors need evidence that the combined platform can sustain double-digit organic growth.
The CFO transition from Bill Castell to Damien Maltarp adds execution and reporting risk during a period when Gamma is simplifying KPIs and shifting investor focus toward gross profit.
Forward outlook
adjusted eps
90–96.6 $per share
FY 2026
official guidance
Recommendation history
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
Upcoming earnings
5:30 PM UTC+2
Period
Jun 2026
Est. EPS
—
Est. revenue
0
Earnings transcripts
- Issuer IR
Gamma Full Year Results 2025 Presentation transcript
GAMMA COMMUNICATIONS PLC
- Issuer IR
Gamma FY24 Results Transcript
GAMMA COMMUNICATIONS PLC
- Issuer IR
CMD Transcript 08 11 21
GAMMA COMMUNICATIONS PLC
- Issuer IR
Gamma Communications Full Year Results 2023 Transcript and QA
GAMMA COMMUNICATIONS PLC
- Issuer IR
Gamma FY Results 2022 Presentation Transcript
GAMMA COMMUNICATIONS PLC
- Issuer IR
Gamma Half Year Financial Results 2022 Presentation Transcript
GAMMA COMMUNICATIONS PLC
Press & signals
- GlobeNewswire
Form 8.3 - Gamma Communications Plc
- GlobeNewswire
Dimensional Fund Advisors Ltd. : Form 8.3 - GAMMA COMMUNICATIONS PLC - Ordinary Shares
- GlobeNewswire
Dimensional Fund Advisors Ltd. : Form 8.3 - GAMMA COMMUNICATIONS PLC - Ordinary Shares
The rest of this company's wire — with summaries and source links — is part of Pro.
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