Guidance warning season
Despite rising geopolitical risk, European corporate guidance has yet to reflect the potential economic impact. In AIR’s recent management meetings, discussion focused almost entirely on AI, with little attention paid to the Iran conflict despite surging energy prices and supply-chain stress that historically drive earnings revisions. The combination of unpriced macro risk and AI-driven sectoral disruption creates a credible basis for expecting a meaningful wave of 2026 earnings guidance revisions across European equities in the coming weeks. And the performance gap between the companies on the right side of these structural shifts and those on the wrong side will broaden. Stock winners include AI infrastructure beneficiaries such as Arm, Elmos, Aixtron and STM, alongside defence exposure at Exosens and Indra Sistemas. Euronext and Auto1 are also seen as largely insulated. Under pressure are Stroeer, Freenet and SES. In IT services, the sector is splitting between “The Conquerors” (Accenture, Cognizant, Reply) and “The Endangered” (Capgemini, Atos, Sage, Dassault Systemes, SAP).
Edition: 232
- 20 March, 2026
Dassault Systemes (DSY FP) France
Technology
Paragon’s Executive Diligence Memos highlight a bearish view of DSY’s Chairman Bernard Charles and CEO Pascal Daloz. While Charles’ visionary approach was instrumental in building the company, his controlling management style will hinder the necessary commercial agility and cultural change, making his continued deep involvement the primary obstacle to DSY’s future performance. Meanwhile, Daloz's plan involves methodical, incremental process improvements and evangelising a long-term AI vision, but his non-confrontational style is ill-suited for driving the disruptive change that is urgently needed. Since Daloz took over, deal slippage has doubled, forcing the company to offer more favourable payment terms to secure deals. This culminated in management cutting the FY25 OCF outlook, a move that has shaken investor confidence.
Edition: 221
- 03 October, 2025
Dassault Systemes (DSY FP) France
Technology
Siemens is acquiring Dotmatics, a US-based SaaS provider for laboratory management, for $5.1bn. The acquisition appears expensive (16.5x EV/sales and 39x EV/EBITDA for FY25) but strengthens the group’s position in the life sciences sector by expanding its digital twin technology and industrial software offerings. Dotmatics adds a new $5.5bn market opportunity, which could grow to $11bn, covering areas like pharma manufacturing, biofuels and chemicals. SIE’s growing presence in this sector will intensify competition where DSY currently leads the market. While GR20 does not expect DSY to respond by going on a buying spree, there could be interesting opportunities for M&A to enhance the 3DExperience platform (on the Biovia side) or Medidata, particularly to align with its recently launched 3D Universes AI-driven environment.
Edition: 209
- 18 April, 2025
Dassault Systemes (DSY FP) France
Technology
The majority of DSY resellers / channel partners have reported missing their internal sales targets this quarter, according to Woozle’s latest channel checks. DSY’s core SOLIDWORKS solution had a largely mixed performance with some respondents reporting that they missed sales targets by 20-30% while others reported very minor Y/Y growth. Aggressive promotions were also prevalent. Despite most respondents reporting underperformance throughout 1Q24, this was driven by lingering uncertainty in the market resulting in lengthened deal cycles rather than competitive dynamics, with many hoping that easing macroeconomic conditions should stimulate sales growth.
Edition: 184
- 19 April, 2024
Dassault Systemes (DSY FP) France
Technology
Woozle upgrades the stock to Buy based on findings from their latest surveys - 33% of respondents suggested they would beat 2Q22 sales targets (50% reported they were in line). Expects quarterly sales to increase by 8.3% y/y vs. consensus estimates of 7.9% for software growth at constant currency. Performance also improved q/q with fewer delays and improved sentiment among customers, alongside some pull-forward effects with the looming pricing increases from Jul 1st. 3DX continues to grow and now accounts for c.15% of sales (vs. c.5% in 4Q22). Forward guidance was either neutral or bullish for the next 6 months.
Woozle interviewed 23 resellers and channel partners. Regional sample mix: 57% from N.America, 39% Europe and 4% S.America.
Edition: 164
- 07 July, 2023