IT service provider cautiously optimistic about the second half of 2025

Bechtle AG, one of the leading IT service providers in German-speaking countries, is cautiously hopeful for a turnaround after a mixed start to the year. In view of sluggish public investment at the beginning of the year and a disappointing Q1 performance, the company is now counting on a revival of business in the second half of the year – driven by special government spending programmes and structural IT trends such as artificial intelligence and the approaching end of support for Windows 10.

Restraint in the public sector weighs on the start of the year

Market observers were disappointed by the results for the first quarter of 2025: Bechtle AG’s revenue fell by 2.8% to €1.46 billion (previous year: €1.5 billion), while business volume rose slightly by 0.8% to €1.97 billion (€1.95 billion). The forecast published in the annual report for the full year 2024 was confirmed, but remained conservative: For 2025, the Group expects revenue growth in a range of plus/minus 3% compared to the previous year’s figure of €6.3 billion, with earnings before taxes ranging plus/minus 5% around the reference value of €345 million.

A key factor weighing on the first half of the year was the ongoing reluctance to invest among public-sector clients, who are traditionally an important customer base for Bechtle. The uncertain political situation at the beginning of the year and delays in the distribution of public funds slowed down many planned IT projects.

New political framework creates planning security

However, according to Bechtle CEO Dr Thomas Olemotz, the situation has eased noticeably with the formation of the new federal government in the spring. The political uncertainty that caused many public-sector customers to hesitate at the beginning of the year has since diminished significantly. Although Olemotz remained cautious about the second quarter, he predicted an improvement in the business situation for the second half of 2025. An increase in demand was already noticeable in March and April, particularly in the public sector.

A key driver of this development is likely to be the billion-euro package from the German government’s special ‘infrastructure’ fund. These funds, which are to be targeted specifically at the digitalisation of public institutions, could provide the long-awaited stimulus for IT investment. As a result, Bechtle also expects to see growing willingness to invest among small and medium-sized enterprises, especially as many of these companies have been closely involved in public projects in the past.

Technology trends as additional growth drivers

In addition to the macroeconomic environment, the technology cycle could also play into Bechtle’s hands. Support for Microsoft Windows 10 is set to end in autumn 2025 – an event that, based on experience, is accompanied by a considerable need to modernise hardware and software infrastructure.

The resulting demand for hardware renewal, migration and support services is likely to have a positive impact on Bechtle’s system house business.

Another future driver lies in the area of AI-enabled IT infrastructures. Many companies are increasingly investing in systems that are based on or prepared for artificial intelligence – especially in combination with cloud platforms, high-performance networks and data analytics. As a provider of comprehensive IT solutions – from hardware and system integration to managed services – Bechtle is strategically well positioned to benefit from this trend.

Share price reflects hopes for stabilisation

Bechtle shares have already experienced a noticeable recovery on the stock market in 2025, which is also reflected in the price-earnings ratio (P/E ratio). Although the P/E ratio for 2025e is 19.3, which is below the historical 10-year average of 24.4, the valuation still signals room for further price potential. Based on expected earnings for 2026 and 2027, the P/E ratios are 17.2 and 15.6 respectively – figures that suggest a gradual return to the previous growth trajectory.

Conclusion: Cautious optimism with a solid foundation

Even though the first quarter fell short of expectations, the course seems to be set for a moderate recovery at Bechtle AG. The resolution of political uncertainties, new investment programmes in the public sector, technology-driven replacement cycles and a pick-up in demand give cause for cautious optimism. In this context, the annual forecast confirmed by the Management Board appears solid and realistic.

If demand continues to develop as expected in the second half of the year, Bechtle could not only leave the consolidation phase behind it, but also emerge from the year structurally stronger. Investors are already placing their hopes in this development – and are likely to follow the future quarterly figures with particular attention.