Valmet's 2026 Financial Outlook: Operational Efficiency and Margin Resilience in an Evolving Industrial Landscape

Valmet’s 2026 financial trajectory hinges on its ability to balance cost discipline with operational agility, a challenge it is addressing through a bold operating model overhaul. By mid-2025, the company had already embedded a EUR 80 million annual cost savings target into its strategic DNA, driven by a 1,150-role reduction and the launch of a Global Supply unit [1]. These measures, while disruptive in the short term (evidenced by EUR 61 million in Q2 2025 restructuring costs [2]), are designed to create a leaner structure capable of withstanding macroeconomic volatility.

The company’s 2025 performance provides a blueprint for 2026 resilience. Despite a 6% Q2 2025 net sales decline to EUR 1.24 billion, comparable EBITA margins expanded to 11.5% from 10.6% year-over-year [2]. This margin improvement, achieved amid a 19% surge in orders to EUR 1.52 billion, underscores Valmet’s pricing power and operational efficiency gains. The Services and Automation segment, a key growth driver, saw orders jump to EUR 1.33 billion in Q1 2025, reflecting strong demand for lifecycle solutions [3]. Such momentum suggests that Valmet’s shift toward recurring revenue streams—rather than one-off capital projects—could insulate it from cyclical downturns.

However, not all segments are equally robust. The Biomaterial Solutions and Services division, which includes Process Technologies, faced profitability headwinds, with margins slipping from 3.0% to 1.0% in Q2 2025 [2]. This divergence highlights the risks of over-reliance on capital-intensive sectors. Yet, Valmet’s “Lead the Way” strategy—targeting a 15% EBITA margin and 20% ROCE by 2030 [3]—signals a long-term commitment to rebalancing its portfolio. The EUR 4.7 billion order backlog at mid-2025 further reinforces this narrative, providing a buffer against near-term volatility [2].

Critically, Valmet’s 2026 outlook depends on the successful execution of its operating model renewal. The EUR 80 million annual savings, fully realized by early 2026 [1], will directly bolster margins. However, the company must navigate near-term challenges, including U.S. tariff uncertainties and the integration of its new lifecycle approach to customer engagement [3]. If these risks materialize, the path to 15% EBITA margins by 2030 could be delayed.

For investors, Valmet’s 2026 story is one of cautious optimism. The company has demonstrated the ability to improve margins even in a weak sales environment, a trait that could prove invaluable during industrial recovery. Yet, the mixed performance across segments and restructuring costs highlight the need for disciplined execution. As Valmet transitions from cost-cutting to growth, its success will ultimately depend on whether its 2030 targets are achievable without sacrificing operational flexibility.

Source:
[1] Valmet plans to renew its operating model to better serve customers with a lifecycle approach, and to increase efficiency [https://www.valmet.com/media/news/stock-exchange-releases/2025/inside-information-valmet-plans-to-renew-its-operating-model-to-better-serve-customers-with-a-lifecycle-approach-and-to-increase-efficiency/]
[2] Valmet Q2 2025 slides: Orders up 19% as company unveils new "Lead the Way" strategy [https://www.investing.com/news/company-news/valmet-q2-2025-slides-orders-up-19-as-company-unveils-new-lead-the-way-strategy-93CH-4147276]
[3] Valmet announces a new strategy, 'Lead the Way', and publishes new 2030 financial targets [https://www.valmet.com/media/news/stock-exchange-releases/2025/valmet-announces-a-new-strategy-lead-the-way-and-publishes-new-2030-financial-targets/]