Harvia Stock Jumps 15% on Record Q1 Revenue of EUR 58.6M

Harvia shares surged nearly 15% on the Helsinki exchange on May 7 after the Finnish sauna manufacturer reported its highest-ever quarterly revenue: EUR 58.6 million in Q1 2026, up 12.7% year-over-year. At comparable exchange rates, the growth was 18.3%. Earnings per share rose 11.9% to EUR 0.50.

Three of four regions delivered double-digit gains. Every euro of growth was organic. The stock closed at EUR 41.05, up 14.7%, then gave back 6.1% to EUR 38.55 on May 8. It was the stock’s biggest one-day move since the 22.5% jump on the Q3 report in November.

The headline numbers were clean. But beneath them sits an operational variable that will shape how the next two quarters read: a major IT and process overhaul at Harvia’s headquarters and production facility in Muurame, Finland, that management expects to shift EUR 3 to 5 million in deliveries and related gross margin from Q2 into Q3.

Record revenue across nearly every region

The EUR 58.6 million in Q1 revenue surpassed the previous quarterly record set in Q4 2025 and built on what was already a strong comparison period. North America, the company’s largest region at EUR 24.4 million, grew 12% in reported terms and 21.1% in local currencies, stacked on top of 58.8% growth in Q1 2025, when the ThermaSol acquisition was ramping.

“This comes on top of a strong comparison period, as we grew 58.8% in the region in the same quarter last year,” CEO Matias Jarnefelt said in the interim report. Growth was driven primarily by heating equipment, while steam products were softer due to weakness in certain key account sales.

Northern Europe posted EUR 13.9 million (+16.7%), its third straight quarter of double-digit gains. Jarnefelt credited systematic distribution expansion in Scandinavia and pent-up demand following slower years, though he noted that the macroeconomic environment “remains subdued.” Continental Europe added 6%, steady but unremarkable. APAC and MEA was the standout at +29.7%, powered by China and Japan, with the Gulf region (about 2% of global sales) seeing only limited impact from Middle East instability.

Profitability: the FX wrinkle

Adjusted operating profit was EUR 12.9 million, an 8.1% increase, with an adjusted margin of 22.0%. That comfortably clears Harvia’s long-term target of exceeding 20%. But the gap between 22.0% reported and 22.4% at comparable exchange rates tells a persistent story: the weakening US dollar shaved roughly EUR 0.9 million off operating profit, dragging the margin by about 40 basis points.

For a company that now earns its largest regional revenue in North America, FX translation risk is structural, not incidental. The dollar weakness hit hardest in saunas and Scandinavian hot tubs and in steam products, both categories heavily weighted toward US sales.

Cash generation was strong. Operating free cash flow reached EUR 12.0 million (up from EUR 10.2 million), and cash conversion of 80.5% was well ahead of the 73.7% in Q1 2025. Net debt fell to EUR 49.4 million, putting the net debt-to-EBITDA ratio at 1.0x, less than half the company’s 2.5x ceiling.

The Muurame IT cutover: the variable to watch

The number that will shape earnings coverage for the next six months is not in the income statement. It is in the operational guidance: Harvia’s ongoing IT infrastructure and process modernization at the Muurame headquarters and factory complex will be completed during Q2, and the cutover is expected to temporarily extend delivery lead times.

Management estimates the disruption will shift approximately EUR 3 to 5 million of deliveries and their associated gross margin from the second quarter into the third. Personnel and indirect costs at Muurame will also rise temporarily during the transition.

“Harvia estimates that no sales will be lost,” the company stated in its Q1 presentation. “Benefits will begin to materialize shortly after the upgrade, with meaningful impact already expected in Q3.”

The upgrades promise higher automation (including AI-driven capabilities), improved operational resilience, and greater business transparency. For analysts modeling Harvia’s quarterly cadence, though, the shift creates a specific optical distortion: Q2 will look compressed, Q3 will look artificially strong, and only the H1 total will give a clean read on underlying momentum. Investors who trade the quarterly print should adjust expectations accordingly.

Balance sheet signals M&A capacity

With EUR 53.4 million in cash and a net debt-to-EBITDA ratio of 1.0x against a 2.5x target ceiling, Harvia’s balance sheet carries substantial unused capacity. The company’s loans from credit institutions stand at EUR 95.4 million, unchanged from a year earlier, and the equity ratio improved to 49.9% from 47.7%.

Harvia has not made an acquisition since the USD 30.4 million ThermaSol deal in 2024, which added US steam distribution and design and assembly facilities in Texas. The company’s long-term growth target of 10% annual revenue growth historically assumes a mix of organic and inorganic contributions. With the ThermaSol integration now fully absorbed into the organic base and the balance sheet underleveraged, the question is when, not whether, the next deal happens.

Analyst reaction

The market’s read was swift. After the report, Inderes downgraded the stock to Accumulate from Buy while holding its EUR 44 target, citing the rise in the share price.

Harvia does not publish short-term guidance. Its long-term financial framework calls for 10% average annual revenue growth, adjusted operating margins above 20%, and net debt below 2.5x adjusted EBITDA. All three targets were met or exceeded in Q1. The EUR 0.77 per share dividend approved at the April AGM will pay its second installment in October.