Match Group “recently” changed their CEO (among other leadership changes), and as he stated during the Q2 earnings call: “Tinder needs a lot of work. It has grown stale because of short term monetization & lack of innovation.” Additionally, there is a general slowdown in the online dating market.
profitability
On the other hand, Match Group has a reasonably profitable business, with an net income / non-current assets ratio of 19% and an net income / revenue ratio of 18%. Furthermore, the new CEO has been making the company more agile, partly by laying off 20% of managers and reducing team sizes; and furthermore by increasing focus on product development. Established dating companies like Tinder benefit from strong network effects.
balance sheet & capital allocation
Match Group has negative equity, and half of their assets consist of goodwill. Their MAU (Monthly Active Users) has been declining since 2022. Furthermore, Match Group acquired HyperConnect in 2021 at what appears to be an overly optimistic price, leading to massive write-downs.
But even with Match Group’s negative equity and high proportion of goodwill, they are executing significant share buybacks. This can be explained by a low interest compared to earnings yield 6,5%. This indicates a shareholder-friendly and aggressive capital allocation strategy that also suggests management believes the company is attractively priced (or he is signalling to the shareholders -> no more expensive acquisitions!).
Note: Match Group has a net income / (liabilities + goodwill) ratio of 8,7%.
market
User sentiment across the industry is historically poor, driven by a perception that dating apps profit from keeping users single. The new CEO has signaled a strategic shift toward brand health, stating, “I would take a positive word of mouth over a $15 subscription any day.” This marks a essential pivot from short-term extraction to long-term value.
Note: Match Group’s declining MAU stems from the Evergreen segment and Tinder, whereas Hinge is experiencing impressive growth.
Conclusion
In my opinion the “new” ceo, seems to be doing the right things. The stock is priced for stagnation – and in my optic – that might just be a tad too pessimistic – even with a historic horrible capital allocation and a trash balance sheet.
Disclaimer
Not financial advice – always do your own due diligence. I can have made mistakes. I have shares in Match Group.
Everyone can code now – but not everyone has brand reputation, customer relations or the competencies to navigate the bureaucracy – all these key elements might be overlooked and misunderstood at the current valuation.
cBrain claims to have a total addressable market of 325 billion DKK in the global government software market.
But; How much of this market is cBrain likely to capture?
#1 Competitors
cBrain is not entering empty territory. In the US, UK, or Germany, local equivalents of EG and Systematic already possess the exact same bureaucratic and relational moats that cBrain enjoys in Denmark. In a low churn sector, does this severely impact TAM.
#2 New Entrants
If AI allows any localized startup to build bespoke workflow tools rapidly, the frequency of new entrants is mathematically high. However, the consequence of this threat to cBrain is remarkably low. Central governments do not buy critical infrastructure from startups. They demand ISO certifications, heavily audited sovereign cloud compliance, and a decade of referenced reliability. This bureaucracy acts as a moat against disruptive new entrants.
#3 Need for product development
cBrain’s products are essentially:
– F2 paperless – A highly disciplined, standardized digital filing cabinet and routing system
– F2 climate – The exact same F2 Core engine, but pre configured to process carbon permits, ESG reporting, and green subsidies
– F2 customization – ServiceBuilder is the low-code toolkit that allows local consulting firms to configure F2 for local governments.
These products are by no means representative of the whole 325 billion DKK TAM. For cBrain to ever approach this figure, it would require excessive product development into areas outside their core competencies. Because F2 does not replace ERP systems or heavy infrastructure, a more realistic TAM is closer to 10% of their reported figure. To extend beyond this 10%, cBrain cannot rely on a simple copy-paste of their current product into new markets; they would need extensive R&D and a fundamentally different sales reach.
So; How are cBrain planning to capture this market?
#1 With aggressive sales in new markets through external companies.
cBrain is pivoting hard to an “F2-for-Partners” model, where external consultancies can install and implement cBrains F2 products. They are building tools (F2 ServiceBuilder) that allow external stakeholders to configure and implement the software.
While this should propel potential customers – it might also be a double-edged sword – Giving sales channels to external partners unavoidably gives away control of own sales channels and execution, potentially damaging cBrain’s reputation and customer relations.
Can cBrain copy paste its Danish government competencies to other governments?
Most likely no. Expecting a 1:1 frictionless interaction using “the Danish way” in different cultures with different “ways of doing it” – will undoubtedly provide friction across stakeholders. With that said – cBrain already has customers globally; proving their model can be exported.
The Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD) are currently being implemented. This is an opportunity for cBrain as their F2 climate can give them “a foot in the door”.
Also, what about incentives and management?
Per Tejs Knudsen founded cBrain in 2002, took it public in 2006, and remains CEO of cBrain — that’s over 20 years of continuous founder leadership. He holds shares through his personal holding company, Putega Holding ApS. CTO Thomas Qvist is also a co-owner through Felida Holding ApS and has been with the company since 2003. The two co-founders did sell a combined 4.2% stake in 2021 to bring in institutional investors. Per received total annual compensation of roughly 3.2 million DKK as of 2024, with base salary of about 2.2 million making up the majority. For a company with a market cap around 3 billion DKK, that’s remarkably modest.
This highlights a long-tenured management – with high insider ownership – resulting in high alignment with shareholders. Finally, the board is diverse and consists of expertise within government, IT and law.
Also, Per Tejs Knudsen has a Master of Science in Engineering from the Technical University of Denmark (DTU) and HD in Accounting from the Copenhagen Business School.
So is cBrain a good investment?
Assuming cBrain can capture 20% of my revised TAM. At a 20% income ratio. Are we looking at a 30 times increase in earnings.
Math stuff
Revised TAM (product-relevant market): 10% of 325B = 32.5B DKK Addressable share (realistic market capture): 20% of 32.5B = 6.5B DKK Potential income at 20% margin: 20% of 6.5B = 1.3B DKK Earnings multiple: 1.3B / 43M ≈ 30x current earnings
cBrain currently (date: 05.04.2026) trades at a TTM PE of 30.
The hurdle of international expansion is massive. Competing with existing national players is not an easy task – But CSRD and CSDDD regulation might boost adoption of the F2 platform. Another potential boost to sales and market share is the adoption of third party consultants. With external partners the scalability significantly increases – at the cost of customer relationship management. Though the incorporation of external partners partly resolves the issue of difference between cultures and workflows – by allowing for customization.
A PE in the 30s demands strong execution! And headroom for growth. cBrain has both. But can they capitalise and scale in new markets? A patient investor might wait and see – I assume the current skepticism surrounding software companies is overdone – and am willing to take on that risk. This is not a margin of safety play – but an expected value play (asymmetric risk reward).
Scenario analysis
Scenario weight 10% = 30 times increase in earnings; exit multiple PE 25. Potential market cap = 32,250M DKK
Scenario weight 65% = 2 times increase in earnings; exit multiple PE 20. Potential market cap = 1,720M DKK
Scenario weight 25% = no increase in earnings; exit multiple PE 15. Potential market cap = 645M DKK
Current market cap = 1,290M DKK
Weighted annual return = 4,504 / 1,290 = 3.5x or 13% a year – over a 10 year horizon; assuming no discount rate. This is under my normal margin of safety at 20% – with a large upside pulling up the average return, meaning great risk of failure. So why am I still considering investing? It’s plus EV and I trust the management. But, In this case; for a 30PE company, there are simply too many IF’s. The uncertainty regarding the product and competition – makes this bull thesis too fragile. I am looking for high conviction, high growth and conservative pricing. cBrain as an investment thesis, is simply not there yet.
Notes & Key Issues
Two conflicting statements from cBrain annual report:
Note : “cBrain estimates the global addressable market for the F2 digital platform to exceed 50 billion USD” (page 14, cBrain annual report 2025).
“Market analysts estimate the global government software market to exceed USD 50 billion, driven by continued digitalization at national, regional, and local government levels” (page 6, cBrain annual report 2025).
Based on my analysis – these two statements are contradicting. I have left it for now. TAM are notoriously difficult to assess. For this analysis to truly shine it really needs two things: 1. Using cBrains TAM assessment is questionable – as I truly don’t know what they estimate as “global government software market. A homemade TAM would significantly improve this analysis. 2. I would need to know more about the product and how satisfied customers are with it.
Another thing –
Financial Overview (DKK millions)
Financial
2022
2023
2024
2025
2026E
Revenue
188
239
268
251
275–290
Revenue growth
—
+27%
+12%
-6%
10-15%
EBT
49
81
86
56
41-58
EBT margin
26%
34%
32%
22%
15-20%
Net income (approx)
38
63
65
43
Revenue fell 6% and margins compressed from 32% to 22%. cBrain attributes this to delays in large government projects, and they’re guiding for a recovery in 2026. Short term profitability is being sacrificed for increased revenue growth.
This is a very profitable company – with very low debt. Meaning shareholder dilution is unlikely to fuel growth.
What do analyst expect?
2025
2026
2027
2028
PE
52.1x
24.2x
15.9x
11.8x
Note 2026 PE is a tad lower than what cBrain themselves guide!. As cBrain is guiding for a real possibility of declining income. These analyst estimates are likely overly optimistic. Market expansion is expensive.
Gemini 3.0 and Claude 4.6 has been used to improve readability.
Note: Not financial advice. I have shares in Trifork AG.
Macro headwinds
Trifork is facing massive structural headwinds. Tech layoffs have flooded the market with programmers, and AI now lets anyone produce good enough code – lowering barriers to entry, increasing competition, and compressing margins across the consultancy sector. Vibe coding further commoditizes “easy to make” applications. However, this risk doesn’t fully apply to “must absolutely function” sectors like security, aviation and healthcare.
The pivot challenge
The unpredictable nature of a sector in disruption is the biggest risk for Trifork. The second biggest is the pivot from selling hours to products.
This pivot is fundamentally harder than it looks. Trifork’s organisational DNA is agile consultancy – scrum teams, sprints, client-driven backlogs. A product-first organisation is a completely different animal. It demands roadmap discipline, saying no to custom requests, investing heavily before a single customer pays, and building sales and marketing functions that consultancies typically don’t have. Being agile does not make you a product company – it makes you good at iterating quickly, which is necessary but not sufficient. The question is whether Trifork can rewire its culture and incentives from “deliver what the client asks this sprint” to “build what the market needs this year.”
The success of Trifork’s future earnings is highly dependent on their ability to make this change – it is still unclear whether Trifork has the competencies needed.
A few questions remain unanswered – Can Trifork sell big software solutions? Will potential customers pay? And how much?
2025 Annual Report – Early proof
Estimating market share and future earnings in such an environment is incredibly difficult. Historic growth cannot be a benchmark in a disruptive environment. The 2025 annual report, is an indication that he pivot is working.
In million EUR
2025 revenue
YOY Revenue Growth
2025 Adj EBITDA %
2025 EBITDA
Products
77.7
37.6%
20.9%
16.2
Services
143.1
-4.1%
13.7%
19.6
The product segment grew 38% year-over-year with significantly higher margins than services. This is what the bull case needs – recurring, high-margin revenue replacing lower-margin billable hours.
understanding the business
Triforks organisation is a bit complex – The labs consists of minority owned (less than 50% stake) companies. While Triforks main business also consists of different business units. Both labs and the main business might sell products (SAAS) or hourly rates.
Finally, this has some implications for the income statement – if Trifork sells a labs company this will affect the income statement – but if they buy a company it wont – also, income from labs does not go to the income statement – but any increase or decrease in book value will.
trifork labs
ArkynStudios (44% ownership) is a “digital enterprise”. They help SAP customers organise maintenance and planning through the APPs: FastWork & FastPlan. Customers include Vestas, Arla, Porsche & Royal Unibrew.
No data: ROA, Solvency & Income.
*put formula used*
AxonIQ (20% ownership) is the most adopted event sourcing framework in the Java ecosystem. Used in banking, retail, insurance, and government systems worldwide. he technology provides total operational control by literally “storing every decision” an IT system makes. While the basic framework is open-source, AxonIQ is the commercial extension that sells the high-margin central management servers required to run it at an enterprise scale.
No data: ROA, Solvency & Income.
Dawn Health (27% ownership) – Digital Therapeutics (DTx) and “Software as a Medical Device” (SaMD). Dawn Health’s value is its ISO 13485 certification and its ability to navigate clinical trials for software. They build FDA-approved and CE-marked software that is prescribed alongside traditional drugs (e.g., companion apps for insulin dosing or chronic disease management). Customers include massive players like Novo Nordisk and Novartis.
ROA -77%. Solvency 80%. Income -52.217.000 DKK
Solvency = (Equity*100)/Assets
ROA = (Income*100)/Assets
Frameo APS(6,1% ownership) – Is a software for those simple tablet looking devices, that can display pictures. Frameo is one of europes fastest growing companies (increased 10 fold over the last two years) – and it is very profitable. Frameo APS is almost the same size as Trifork.
ROA 60%. Solvency 80%. Income 106.868.000 DKK
XCI Holding (5% ownership) – Is a cyber intelligence firm – they help government agencies track down cyber criminals – using their extended platform/product. Income has grown steadily since 2021 and has increased five fold since then.
ROA 50%. Solvency 98%. Income 52.171.000 DKK
trifork trifork
Trifork group consists of Trifork and Trifork majority owned companies.
Ownerships on p147 & p151 annual report.
Nine AS (ownership 90%) – Almost entirely public sector. Triforks biggest unit – with a Fairly big market share among Danish Government Agencies. The april 9 – Nine won a contract to deliver Danish Digital Wallet for the Danish Agency (Digital Government) worth 29.000.000 DKK. Nine has had a pretty big retraction in ROI which is down from the 40’ties in 2021-2023 – with income only slightly down.
ROI 27,5%. Solvency 76,5%. 38.112.000 DKK
Netic (ownership 88%) has developed the platform Contain – a cloud platform designed to develop and run big applications – with Netics own datacentres.
ROI 11%. Solvency 28%. Income 12.795.000 DKK.
Erlang Solutions (ownership 100%) – Erlang & Elixir programming language. Designed for zero downtime. Mostly consultancy/ programming services . *no numbers?*
Trifork products solely under the Trifork brand includes: iFly4A – Modular application used by the crew to “duty schedules and flight info to checklists, documents, and peer-to-peer messaging – (…) customizable tools”. Customers includes … See more: https://trifork.com/aviation-app/
Alon is a response to The EU Pay Transparency Directive. Its is an application that contributes with – Automate pay audits, Transparent pay ranges, Custom reporting & Fair pay recommendations.
Tiris messenger is messaging platform for companies with strict GDPR regulation. It uses encrypted messages with sovereign datacentres.
Sovereign AI as a service – is a another product being offered by Trifork. It is essentially a combination of Corax AI, Corax Data and Netic datacentres.
A deeper dive into growth drivers & hinderes
The pivot away from US tech conglomerates is a potential growth catalyst. In Trifork’s own words – “Danish public authorities are increasingly facing challenges related to dependency on a small number of large foreign technology providers and limited control over data and critical digital infrastructure” (annual report, 2025). It is the segment Netic that is most likely to take advantage of this. Note Netic earnings is about 2 million EUR (about 8% of Trifork earnings).
While 8% of total earnings is minor – the addressable market for Netic is huge; managing the data within the European public sector. Crucially, the regulatory barrier to entry is valid. Though, resolving the issue surrounding the US CLOUD Act and European GDPR might completely strip away Netic’s potential – as their market disappears.
Netic’s platform is being levered through most of Trifork Groups products – highlighting Triforks strategy of leveraging capabilities and synergies across business units. In some scale – making Trifork as an investment – a sovereign data play – as a wide range of Triforks products, differentiate on NIS2 and GDPR regulation.
Valuation
Traditional valuation methods struggle in a disrupted sector with a changing business model. Historic growth rates are unreliable as a benchmark. Analyst forward estimates are stale and might not account for AI disruption or the uncertainty of a mid-pivot business model – if it matters – they are projecting a PE under 10 by 2028. In short – assigning growth rates to Trifork is incredibly difficult.
Trifork currently trades at a TTM PE in the low 20s – cheap in historical terms. This suggests the market has already discounted significant disruption risk. Note – this excludes about 10% of Triforks earnings, which is accounted on the balance sheet!.
The product growth in 2025, is a key – as this is an early indicator that the pivot towards the software as a service is working. Though not conclusive. If the services-to-products pivot continues at anything close to the 2025 pace, earnings could grow substantially within three years – compressing the PE into single digits at today’s price.
Triforks own guidance indicates severe mispricing – at a 2026 PE around 12,5 and 11. Assumed 50% income to EBITDA ratio. Guidance 35 to 40.000.000 EBITDA.
Conclusion
Can Trifork move away from what made it successful – agile, customer-first consultancy – toward a product-first mindset? The 2025 annual report suggests it can – while the market seems to not think so (no trust in that EBITDA guidance!). If the pivot holds, the upside across healthcare, data sovereignty, and aviation is substantial. The Trifork Investment case is essentially a bet on #1 a normalization in software consultancy #2 data sovereignty in EU as a catalyst towards high margin recurring revenue.
Trifork since ipo
2021-2022: Zero interest rate policy environment. High valuations, particularly in the LABS segment.
2022-2023: Rising interest rates drove multiple compression and resulted in write-downs within LABS.
2023-2024: Oversupply of developers (driven by Big Tech layoffs) and delayed IT investments due to higher interest rates and macroeconomic uncertainty. This triggered a collapse in operating income. When consultants aren’t billing hours, the bottom line takes a severe hit.
2024-2025: The Service segment continues to face headwinds (declining 4%). A new product-oriented strategy is driving higher margins. Operating income is recovering to 2022 levels.
NetEase is a Chinese gaming giant. NetEase has launched a series of games, where bigger publications include: Where Winds Meet & Naraka Bladepoint.
MARKET
NetEase’s bull thesis is closely associated with the company’s execution and favorable demographic growth – As Gen Z are spending more time gaming relative to other entertainment forms such as streaming – partly driven by an increase in girl gamers. The bear thesis lies in regulatory measures in Europe, whereof daily logins, loot boxes and microtransactions are increasingly frowned upon – and likely to be regulated. Another risk is the ADR structure and a potential escalation of conflict between USA and China.
STRATEGY& MARKETING
While the gaming sector is highly competitive with high capex and – usually a short lifespan for products (though SAS has been popular for a while now). These functions as MOATS – As spending millions and years of development, creates barriers to entry. Furthermore, NetEase big inhouse studio, serves as unique competencies that new entrants would have to compete with.
Competing for share of wallet, NetEase has great success, using influencer marketing -> Creating substantial word of mouth – and successfully appealing to their target customer group through the appropriate channels (for the western segment: Twitch & YouTube).
VALUATION& PROFITABILITY
NetEase is highly profitable and has a quite conservative balance sheet – both in absolute and in relative terms.
(MarketScreener, 2025) (Sheets, 2026).
Should note that – few of these are pureplay – kadokawa being a publishing company and Tencent a tech conglomorate (social media etc.). Furthermore, that the long development time of some AAA games, renders companies such as Take Two (GTA) difficult to compare on a ratio basis. Numbers are based on annual and not quarterly figures.
NetEase TTM PE is at 07-02-2026 trading at a 14,75 PE – likely attributable to their succes with Where Winds Meet (which launched early 2025 in China). Since 2025 Q1 EPS have slumbered a bit, calling for a slight eventual retraction in PE (depending on upcoming product launches). Basis for TTM PE:
(MarketScreener, 2026) (Sheets, 2026).
NOTES
70% of assets is cash & cash equivalents (Sheet 2026). Not updated for quarterly figures.
CONCLUSION
NetEase is essentially a quality company trading below PE 15 – likely attributable to major regulatory risk.
Match Group has negative equity, and half of their assets consist of goodwill. Their MAU (Monthly Active Users) has been declining since 2022. Furthermore, Match Group acquired HyperConnect in 2021 at what appears to be an overly optimistic price, leading to massive write-downs.
Match Group recently changed their CEO (among other leadership changes), and as he stated during the Q2 earnings call: “Tinder needs a lot of work. It has grown stale because of short term monetization & lack of innovation.” Additionally, there is a general slowdown in the online dating market, and indications suggest Bumble has captured market share from them – along with other and more niche dating apps.
On the other hand, Match Group has a reasonably profitable business, with an adjusted income / non-current assets ratio of 19% and an adjusted earnings / revenue margin of 17%. Furthermore, the new CEO intends to focus on making the company more agile, partly by laying off 20% of managers and reducing team sizes; he also plans to increase focus on product development. Established dating companies like Tinder and Bumble benefit from strong network effects.
Even with Match Group’s negative equity and high proportion of goodwill, they are executing significant share buybacks amounting up to 130% of adjusted earnings. This can be explained by a ( long-term debt / interest expense ) of 2.4% and an adjusted earnings yield of 6.9%—in other words, low interest expenses and a low valuation (earnings per share relative to share price). This indicates a shareholder-friendly and aggressive capital allocation strategy that also suggests management believes the company is attractively priced.
But – Match Groups debt ratio is simply too high, to justifying big share buybacks. While aggressive capital allocation is appreciated, the overall health of the company should come first. This is especially true since Match Groups refinancing could be coming in at higher interest rates. Furthermore stagnating revenue increases business risk which further increases cost of capital.
I assume – The online dating market will continue to grow in the long term, following a normalization in MAU after a period of rapid expansion.
Conclusion
Match Group represents a high-risk turnaround case. While the company benefits from significant scale, network effects, and valuable user data, it faces major headwinds from elevated leverage, refinancing risks, and uncertainty regarding both execution and market development. Although the current valuation reflects many of these concerns, long-term success depends entirely on management’s ability to restore earnings growth and improve the value perceived by customers.
Notable mentions:
– User sentiment across the industry is historically poor, driven by a persistent perception that dating apps profit from keeping users single. The new CEO has signaled a strategic shift toward brand health, stating, “I would take a positive word of mouth over a $15 subscription any day.” This marks a critical potential pivot from short-term extraction to long-term value.
– Interest expenses decreased in 2025, due to refinancing at a lower but stable interest. Decreasing the overall refinancing risk. Interest expenses should be higher in 2026, as there was a longer period in 2025 between paying off loans and settling new loans (Q3 2025). And liabilities/assets increased.
– Match Group’s declining MAU stems from the Evergreen segment and Tinder, whereas Hinge is experiencing impressive growth.
– Match Group has a adjusted earnings / (liabilities + goodwill) ratio of 8%.
Privacy & Cookies: This site uses cookies. By continuing to use this website, you agree to their use. To find out more, including how to control cookies, see here: Cookie Policy.
