I'm delighted to welcome the CEO, Andrés Martin-Birner, as well as the CFO, Timm Armbrust, who will speak in a moment and guide us through the presentation. After the presentation, we will move on to a Q&A session in which you will be allowed to place your question, preferably via audio line, directly to the management. I would say, let's jump straight into the numbers. Andrés, the stage is yours.
Thank you very much. Welcome to today's earnings call, a presentation for the first quarter 2025. My name is Andrés Martin-Birner. I am the Founder and CEO, of Bike24. At my side, as always, is Timm Armbrust, the CFO of Bike24. Let me now start with the general update on the first quarter of this year before I hand over to Timm, for the business update, finishing with a general summary, the confirmation of our 2025 guidance, and our Q&A session. The first quarter was again very successful overall and once more clearly shows the positive trend. Despite a difficult market environment, we achieved a revenue growth of almost 18%, and an adjusted EBITDA margin, of plus 1%. This was the strongest sales growth since Q2 2021, the year of our IPO, and this also means an improvement in adjusted EBITDA, of plus EUR 2.1 million.
Although the quarter was characterized by the winter sale and seasonally weak demand, we were able to slightly increase the gross margin, and once again achieve a positive adjusted EBITDA. We achieved this result thanks to higher product availability, attractive offers, and an early start to spring. In particular, the continuous improvement of our offering for our customers led to strong growth in all core markets: DACH, plus 22%, the localized markets Spain, Italy, France, and Benelux, plus our new markets Finland and Poland, with sales growth, of 17%, and rest of Europe, plus 10%. It is particularly pleasing that the newly at the end of February, localized markets of Finland and Poland, got off to a very successful start and recorded growth, of plus 48%, in margin alone.
Moving on to our assortment segments, our core PAC segment, recorded sales growth, of 21%, which once again demonstrates the importance of the expert enthusiast bike market. On the other hand, despite a difficult market environment, we achieved unexpectedly high sales growth, of plus 6% for full bikes. This was the highest sales of full bikes in the first quarter ever. In terms of inventory, we have made further progress in reducing. Especially PAC inventory, was reduced significantly versus March 2024 by almost 9%. The ratio of sales to inventory, has returned to pre-pandemic levels. Our target level of 25%, of sales, is now within reach. Looking ahead, we confirm our guidance for 2025 to take account of the ongoing macroeconomic uncertainties, even if revenues are likely to be at the upper end of the range.
We therefore expect the positive trend of the last few quarters to continue, and we consider the results of the last few weeks with double-digit sales growth to be promising. This was the intro from my side. Timm, over to you now for the financials.
Yeah, thank you, Andrés. Let me start by walking you through the figures for the first quarter of 2025. Over the past four quarters in a row, we have continuously improved our growth rates. In Q2 2024, we saw a 1% increase, followed by 3%, in Q3 and 7%, in Q4 of 2024. In Q1 2025, we achieved revenue growth, of 18%, compared to the same quarter last year, a significant acceleration. Let's look at the numbers in detail. We generated EUR 58 million in revenue, in 2025 compared to the EUR 49.3 million in Q1 last year. The main driver behind this growth was our parts, accessories, and clothing segment, which grew by 21%. Even our full bikes segment, contrary to expectations, increased by 6%.
Despite the ongoing overstock in the full bike market and heavy discounts, we could attract more and more people to buy such an expensive and technical, sophisticated product at our platform, Bike24. Besides a general attractive product assortment, we are benefiting from our scale and long-standing relationship with manufacturers. We are able to secure highly attractive special batches, which we offer at a great price-performance ratio. Let me emphasize this again. 6% growth, in this product segment, is clearly above our expectation in the current market situation, and 21%, in the PAC segment is excellent. Looking at regional performance, we see a broad-based growth pattern. In all strategically important European markets, we achieved double-digit growth rates. Especially strong was our core market, DACH, which grew by 22%. Our localized markets increased by 17%, notably Finland and Poland.
Both launched at the end of February, reached 48% growth in March, very promising going forward. In the rest of Europe, we haven't yet localized. We still managed to grow revenue, by 10%. The rest of the world segment, remains in decline, but with just around 2%, of total revenue, it has a minor impact on overall performance. Let's now take a closer look at our key regions. First, let's look at the drivers in our DACH region. The 22%, revenue growth, was supported by a higher average order value and an increase in both new and existing customers. The average revenue per customer, rose by 4%, and the number of active customers increased by 18%, year over year. In our localized markets, France, Italy, Spain, Benelux countries, and Poland and Finland, the picture is intentionally different, so equally positive.
As we are still in the early stage of market development with a clear focus on winning new customers, our efforts are working well. The number of active customers increased by 19%, while average revenue per customer remained more or less stable. As a result, we achieved 17%, revenue growth, in this region. As Andrés and I already mentioned, the start of Poland and Finland, is very promising. In the rest of Europe, meaning countries without a localized webshop that mainly order via our .com domain, we also saw strong growth, plus 10%, revenue in Q1. This was mainly driven by improved product availability and ongoing inventory reduction across the market. As a result, customers are increasingly returning to platforms like Bike24, that offer the full product portfolio of the bike industry. Now let's have a look at the balance sheet and cash flow development.
Our efforts to reduce working capital, are delivering strong results. Compared to the same quarter last year, we've reduced working capital by 18%. Our inventory was reduced by 7%, and currently stands at EUR 66.2 million, a level that aligns with pre-pandemic ratios. This progress is driven by two factors. First, the consistent reduction of old stock. Second, the adjustment of our purchasing strategy. Thanks to the successful implementation of SAP, we are now able to reorder more frequently, even across our outstanding road assortment. This allows us to maintain high product availability for our customers despite lower inventory levels. As a reminder, at the peak of the crisis in the bicycle market, we held over EUR 90 million in inventory. This had a direct impact on our free cash flow. In combination with the improved operating results, inventory reductions and lower investments significantly boosted free cash flow.
We used most of this free cash flow, to deleverage the company, repaying a total of EUR 8 million, in bank loans. Since December 2023, we reduced the bank loans by EUR 11 million, more than 27%, of the initial loan. Let's take a look at our operating results. We slightly improved our gross margin, by 0.2 percentage points, a notable achievement given the still challenging market environment and the traditionally low margin in Q1. Not to forget here, we grew revenue, by 18%, underlying the competitiveness of our pricing strategy and its success in attracting new customers. We have kept our marketing strategy conservative. With just 1.2%, spent on performance marketing, we reached 18%, revenue growth. We are returning to the highly efficient marketing level.
We also saw a 0.3 percentage point, improvement in sending cost, driven by disproportionate growth in the DACH region, the region with the lowest shipping costs, and significantly better utilization of our two warehouses. One of the biggest levers was the reduction in personnel expenses. The measures we introduced in November are paying off. Here alone, we improved our EBITDA margin, by 3.2 percentage points. In total, we achieved an adjusted EBITDA margin, of 1%, in a still challenging market and outside of the main cycling season. This corresponds to an improvement in operating profit of EUR 2.1 million, or 4% of revenue, compared to the same quarter last year. With that, I will conclude the business update and hand it back to Andrés.
Thank you, Timm. Following an already successful fourth quarter 2024, we were able to increase revenues and profit, in the first quarter. The turnaround that started in Q2 last year has gained even more momentum, outperforming expectations with 18%, revenue growth. It shows again that also our focus on profitability is paying off. The fact that we were able to increase sales in all focus markets is a good sign of a turnaround. The regained strength in our home market in particular gives us confidence for the coming quarters. As you know, localization is an important part of our three-pillar strategy. We were able to launch Poland and Finland, earlier than planned at the end of February and achieved above-average sales growth, of 48%, in March. We are also pleased to report the highest sales of bikes we have ever had in the fourth quarter.
Inventories were reduced to around EUR 66 million, a solid decrease compared to the same quarter of the previous year, accompanied by significantly higher sales and improved product availability. This is a really big success for Bike24. Before we come to the confirmation of our guidance, the first results in April, which showed double-digit sales growth, are very promising. To finish, let's look ahead. With a significant growth in Q1 and the promising results of the last few weeks, we anticipate a sales growth, between EUR 233 million and EUR 242 million for 2025. We are currently assuming that we will end up at the upper end of the forecast. We also confirm our guidance for adjusted EBITDA, of between EUR 7 million and EUR 12.1 million. As you can imagine, our guidance is based on the assumption that both the macroeconomic environment and consumer sentiment will not deteriorate significantly.
I would now like to thank you for your attention, and we are now open for your questions.
Thank you very much for the presentation, and we will now move on to the Q&A session. For a dynamic conversation, we kindly ask you to speak and ask your questions via the audio line. To do so, click the raise your hand button, and you will be able to speak. If you have dialed in by phone, please use the key combination star 9 followed by star 6. If you're not able to place your question, you can use our chat box. We have the first participant. Mr. Schmidt, you should be able to speak now.
Yeah, hello, thank you. Congratulations first on the strong Q1 results, especially in the still challenging market environment. I have two questions. First, you reported impressive growth in Poland and Finland. Could you elaborate on your long-term plans and margin expectations, for these new markets? Second question, looking ahead to Q2 with favorable weather conditions in April and Easter, falling into the current quarter unlike last year, how have these seasonal factors impacted the early weeks of Q2? Thanks.
Maybe I can catch the questions from you. Thank you. Yeah, when we look to Poland and Finland, it is, yeah, I would say slightly comparable to other localized countries when you see the development of these countries. To be honest, when we localized Benelux and also Spain some quarters ago, we had triple, more than 100% growth. Today, as you know, we have a little bit conservative marketing approach. We look more for sustainable and profitable growth. That is why we are very happy that we have above-average growth in Poland and Finland. To be honest, we are very promising for the first results. To be honest, we started at the end of February, and that is why it is a little bit too early. I think that there is enough headroom to grow for Finland and Poland.
That is why we also expect, yeah, above-average growth for the coming quarters. The second question, is regarding our double-digit growth in April. To be honest, the season has just started. We are still very early in the year, and yeah, a lot can still happen on the market side. When I look back, it makes sense, or in the past we did it, that you have to summarize March and April together, because maybe we have an early start. It is good to see what April brings. That is the reason why we are very promising also for the second quarter this year. Yeah, to be honest, it is really, really early in this year. The bike market, is not yet providing really a major tailwind, so we are therefore gaining market share. We remain cautiously optimistic for the coming weeks.
Yeah, thank you. Thank you very much and continued success in 2025.
Thank you.
Thank you. We have one participant dialed in via phone, so I cannot see his or her name. It would be very polite to just introduce yourself. You can speak now and place your question. That is not working for the moment. We move on to the next participant. Mr. Shuang, you should be able to speak now.
Yeah. Now you should hear me.
Yes.
Yeah, perfect. Two questions from my side. Following on the April development, you mentioned, just to get a feeling, was it more in the range of the Q1 growth, or was it an acceleration versus Q1 in April, or slowdown in April versus Q1? Also, on the price side, how was the price development in Q1 and also in Q2 when you say you could gain market share? Was it also possible to increase prices, or what was the development on this side? Thanks.
Yeah, hi, Lukas. Thanks for the question. Overall, it was a little bit better than Q1 from the growth perspective, but it was comparable to last year from the gross margin perspective. Overall, we could not increase prices significantly. It is slightly better than the first quarter in April, but we are still focusing for sure on growth, even as Andrés, already mentioned that it is very early in the season, and we would like to really gain market shares again. Our pricing is very competitive at the moment, and we are very successful with that. For April, we did the same as in the first quarter.
Okay, thanks.
Okay, thank you very much. We again try to connect with the participant dialed in via phone. You should be able to speak now. Unfortunately, this is not working. We are still trying on that one. There are no further questions in the line.
Hello.
Yes. Now we can hear you.
Hello. Thanks, God. Oh my God, what a conference. Three additional questions from my end, please. First, on new customers, can you give us some indication how you judge the quality of these incoming customers? Are they really enthusiasts, or is this a brick-and-mortar cyclist, that orders a bottle and a helmet here and there? Second question, on the risk of oversupply, most of the equipment is coming from Far East, and we all know that sending towards the U.S. could be problematic this year. Do you fear that the European market, is potentially flooded with stuff from Asia? The third question, is again on competition. You mentioned some indications you're taking market share. What are you hearing from competitors, or what makes you confident that you can take market share from other vendors? Thanks a lot.
Hello, Mr. Schmidt. Thank you for your question. I would propose to Andrés, that I will answer the first question and then hand over to Andrés, for the second and the third question. First question, overall, new customers regroup by 21%. We are gaining more than 120%. What is it kind of people we are expecting, and we see that also from the type of product that they buy, that they are enthusiasts. I think also what is underlining that assumption is that the marketing costs are very, very low. With the 1.2%, we are really back on levels before the pandemic. With that, you really only reach the bike enthusiasts and bring that to our platform. That is very promising.
Okay, then I catch the other two questions. Today, to be honest, we do not see an impact of maybe floating the European market from Asia, maybe from that there are maybe goods dedicated for the American market, are now in the European market. Today, we do not see this. It could happen, but to be honest, when we look back and see when we offer clearance deals, then it is really, yeah, our growth is jumping up. We see today more the chances and look, I would say, opportunistic on this case. To be honest, when we look to our core market, the enthusiasts and the experts, so yeah, today there is no impact in the market, and we do not see this today. Yeah. The third question was regarding to the competitors.
To be honest, there are some rumors of the market that some of competitors had also a good start into the year, but it's not very transparent. It's not really visible for us. It's hard to say how the figures are from competitors. We see that we don't have really a tailwind, as I mentioned, from the whole market, and we expect that the whole market is not increasing by more than 10%. That's not what we hear, and that's also not what we hear also from competitors.
Okay, thanks a lot. Very helpful.
Yes, thank you. In the meantime, we did not receive further questions via the chat or on the audio line. I will wait a few more moments. It is not the case that there are other questions online. We therefore come to the end of today's earnings call. Thank you for joining, and this short but lively conversation. Should further questions arise at a later time, please feel free to contact Investor Relations. A big thank you to the two gentlemen for the presentation and the time you took to answer the questions. I wish you all a lovely remaining week. With this, I hand over again to Andrés and Timm, for some final remarks.
Yes, thank you again for your attention, and I wish you and my team, yeah, a nice weekend for all of you. Thank you very much, and we see you again. Bye-bye.
Bye.