OVHcloud eyes faster 2027 growth as it posts first positive cash flow since IPO

Oct 20 — French cloud operator OVHcloud reported its first positive ​levered free cash flow since its 2021 listing on Tuesday, as its revenue grew 7.2% to €1.15 billion ($1.29 ‌billion) in the financial year through August.

The milestone means OVHcloud now covers its heavy ⁠capital spending from its ​own operations, after five years ⁠of losses on cash generation. It forecast revenue growth exceeding ‌10% and continued ‌positive cash flow for fiscal 2027.

Acceleration in fourth-quarter growth ⁠was led by the Digital ⁠Scalers segment, CEO Octave Klaba told Reuters, following the reorganisation of the company's offering since his return a year ago.

Digital Scalers — OVHcloud's fastest growing business that serves clients spending more than €2,000 a month — posted comparable revenue growth of 12.4% ‌to €359.1 million and made up 31% of ​the company's sales. Public cloud revenue rose 18.9% to €255.1 million.

Klaba said the year had been one of discipline and OVHcloud had "returned to its fundamentals".

Levered free cash flow reached €24.7 million, against an outflow of €27.0 million a year ago. Adjusted earnings before interest, taxes, depreciation and amortisation rose 9.7% ​to €480.5 million, resulting in a margin of 42.0%. For fiscal ‌2027, it aims ‌to ⁠raise the margin to above 42.5%.

Net debt stood at €1.16 billion, or 2.7 times its adjusted EBITDA, compared with 2.9x at the end of the previous fiscal year. It has €255 million in ‌available liquidity and no ​significant debt repayment due before ‌fiscal 2030, it ⁠said.

($1 = 0.8904 ​euros)

(Reporting by Leo Marchandon in Gdansk; Editing by Christian Schmollinger and ​Milla Nissi-Prussak)

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