What is behind that? We have revenue growth of 13% across the group and profit growth of 76%. The EBITA margin improving from 7.2%- 11.4%. Still not at our goals, but we feel like they are more in sight. BTS North America is back to sustained profitable growth. I will spend more time on that in a minute, but 17% organic growth in North America is a strong result in the third quarter. BTS Europe continued to grow 15% in the third quarter, and with profit growing, but margin down just a bit. The actions that we have been talking about for the last two quarters in other markets are now starting to show results, with BTS Other markets growing 7%. Big headline of the third quarter is we had 22% productivity gains in the third quarter.
That is a result of the AI diamonds, as we refer to them, the AI transformations across our products and workflows that started in 2025 and have continued through 2026. We can now see the benefits of this in terms of our overall productivity and competitiveness. Our move into AI enablement and implementation, it started about three years ago in terms of helping our clients with AI adoption, and this year we have been moving into workflow implementation and helping our clients go AI-native. It is proving to be very differentiated in terms of the BTS way, and that is also helping us win. If we double-click BTS North America, it feels great. It is back to sustained profitable growth with 17% organic growth, 136% EBITA improvement, again, back to the productivity gains I just mentioned, and EBITA margin of 12.7%.
The turnaround that we have been talking about since Q2 2025 is now complete. Our growth and profit was driven by the double-digit revenue growth, but as well as the cost savings from all of the AI innovations we have been talking to you about the last six quarters. We expect the strong performance for BTS North America to continue for the remainder of 2026. Revenue growth continues in BTS Europe, but our EBITA margin is slightly down. Growth of 15% in Europe in the third quarter. EBITA grew 2%. EBITA margin dropped from 9.1%- 8.1%. The issue in terms of the margin was less favorable revenue mix. We had to use more contractors than normal due to a higher percentage of revenue in our assessment space, increased IT costs having to do with AI and AI experimentation, and the currency effects.
BTS Europe will be following the momentum of BTS NAM in 2027, and they expect to have more AI innovations next year. We expect BTS Europe's organic revenue to slow down for the rest of 2026. BTS Other markets. BTS Other markets started the year off slow and underperforming, and we put a lot of actions in place, and it is starting to show results. We are back to growth in the third quarter at 7%, profit improvement of 39%, so that productivity gains are very strong in most of the world as well. EBITA margin improves from 8.8%- 11%, and the margin improvement is driven both by the revenue growth along with office space optimization. They are also great at sharing resources across their 16 countries. We think the full benefit of the actions taken are not still fully visible, but they are tracking well.
The pipeline, the sales pipeline, number of opportunities, win rates, and so forth, tracking across the regions remains encouraging, and we feel good about BTS Other markets continuing to grow for the rest of 2026. As we're reflecting on our growth and the faster-growing nature of our AI services for our clients, the early moves, the decision to move fast into AI, both internally and then take our lessons externally in the overall AI enablement and implementation is proving to be a good decision. If we look at the overall market demand for the AI consulting market, it's estimated to grow 23.4% CAGR over the next decade, starting at about $14 billion in total market size and growing to $112 billion.
With our eye on this market, you can see our improvement from last year to this year over Q1, Q2, and Q3, and AI revenues as a percentage of our total revenues continue to increase, with 11% in the third quarter. You also saw the press release we put out on a deal, approximately $12 million, of which the majority was planned to be spent in the fourth quarter, a little bit in Q3, and potentially a little bit in Q1, helping a global enterprise in terms of their overall AI workflow implementation and training needs.
I would just say that as the world's companies are learning from how they've thought about AI the last three years into shifts that they want to make to accelerate their ability to AI max every workflow, product, and service in the company, the demand for our services continues to increase as people see it more of a people problem than a technology issue. Why invest in BTS? There's three main reasons. Number one, we have a history of growth, right? It's in our blood, it's in our DNA, and we are back to sustained profitable growth. AI is creating more opportunities for us, both in terms of the competitiveness of our services and additional improved productivity to come, while the core demand for BTS's services remains strong, and our growth is capital-light.
If we look into these a little bit more in terms of sustained profitable growth, we have an amazing list of global clients, including the AI frontier companies, innovating how companies learn, change, and perform. We estimate we only have 1% market share across our 24 countries. As I mentioned, we're back to growth with a particular highlight on North America growing 17% organically in the third quarter. Our core remains in strong demand. Clients, even though their token costs are rising and they're investing in how to evolve their operating model and be more competitive in this era. They are also investing in culture and getting people together and simulations and upskilling and training and supporting their teams as they innovate with AI and implement the new ways of working. We think we're in the sweet spot for AI demand and AI-driven innovation and efficiencies.
Still, we believe we are in the top 5% of enterprise companies for our own fast-paced movement with our own AI experimentation and innovation. Four transformations underway. We have about 11 others that are still in the innovation phase, and we will see when they actually turn into AI diamonds. It allows us to take what we are learning from inside our firm to our clients. Going AI-native across products is not a technology issue. This is not digital transformation of the last five decades. This is not ERP, CRM. This is much more like everybody is finding out how to use the internet for the first time. Most people are familiar with this visual of the NVIDIA stack from Jensen Huang. The idea here is the layer above is what sets the speed limit for the layers below them, and we think NVIDIA is missing a layer.
We think they are missing the sixth layer, and the sixth layer is the people layer, because the speed with which companies can adopt AI and leverage all of this technology is 100% correlated to every individual's ability to AI max what they do on a day-to-day basis, and that is BTS's sweet spot. As I mentioned before, AI enablement and implementation services are up 13%, and they represent 11% of group sales. Last point is our growth is capital light in terms of our business model. We have had 12% revenue CAGR since our IPO in 2001. Roughly two-thirds of that is organic growth. We have been able to use our own cash generation to pay for a number of acquisitions instead of going back to the shareholders.
We typically have a dividend between 40% and 65%, and we have a net strong cash position with cash conversion 79% over the last 12 months. Outlook for 2026 remains consistent that the results are expected to be significantly better than 2025.
Excellent. Thank you very much, Jessica. That was straight to the point. Very good. I start off with a question. I can first highlight, if you have any questions, feel free to write in the chat, and I will read them up for Jessica, indeed. I start off here with the, you mentioned AI deal in North America that you announced. Some contribution in Q3. How large was that contribution? Could one assume like 10% of the total value or something?
Yeah. Approximately 10%.
Okay, perfect. Then you have said that majority is expected in Q4. Can you say anything more about this deal? What sector is the customer in, or is it a global customer? Can you say something?
I would just say it is a global leading customer.
Yeah.
Right, who believes in the importance of upskilling and enablement around workflows-
Yeah.
-individual productivity.
Is it a company in the tech space or the AI space, or is this more of a general enterprise?
Can't say.
Can't say. Okay, fair enough. Fair enough. Also, on AI implementation deals that you win outside the tech sector, meaning that you help other large global companies, exactly what you highlight here.
Yeah.
What type of industries and end sectors are you seeing, like the front and the leading companies? Where do you see them?
You know what? I do not see any sector moving faster than the others.
Okay.
I also don't see it by geography. By country and by industry, you have the full range of company cultures and attitudes towards AI. You have ones that are just still getting started, and then you have others who are, you know, the CEO has basically said, "It's my job to get this done." They've asked their BU and functional leaders to show proof of AI experimentation and innovation as a requirement, and then IT finds a way to support that. So that's kind of the range. But I can't call out one particular industry yet. It's too early.
Geographically, is it North America leading this versus Europe and Asia, or?
No. No.
Let's put it that way.
Yep. I was at a CEO dinner in Asia, and I found the same range there. There were some companies and CEOs who were faster moving than many of the American CEOs I've talked with. I've been in European company meetings, and I've been impressed by their speed. I can't say.
Interesting.
Too early.
I also had a question on Europe. You were a little bit cautious into Q3. Now you managed to grow 15%, and now you are a bit careful or cautious into Q4 on growth as well. What are you seeing there, and why are you highlighting slower growth in Q4?
Well, they have had such strong growth for the first three quarters, so I think for the year, Europe will have a good year, right? We just saw the slowdown coming for the fourth quarter in kind of the last eight to 12 weeks, just given deal flow and all of that. It is not because we are losing.
It is more the mix of being billable and time to sell and driving the pipeline and all of that.
Okay. Okay, we have a couple of questions from the chat here. We start off with Oscar Rönnkvist from SEB. The Q3 margin, specifically in North America, were there anything that boosted that margin, like a temporary effect? Or is it realistic to extrapolate the strength and assume a normal seasonality into Q4 from that basis?
Yeah, yeah. There was nothing unusual. There was no extra boost. This is the benefit of the transformations that we have been doing and simplifying our operating model and kind of the backend of the company to be more competitive.
Hmm. I see. Another question from Oscar as well. Did you take any temporary costs in Q3 for Europe, which pressured margins, and should we expect anything in Q4 as well, pressured margins?
The only thing in Q3 was the growth in our assessment services was as high in Q3, which is why we needed to use more external contractors than our full-time people. But other than that, there was nothing else unusual.
Okay, clear. Then we have two questions from Jacob Söderblom as well. First one, talking about AI workflows expected to contribute to improved European margin in the second half of 2027, you highlight in the report. Should we read this as an improvement year-over-year versus the second half of this year, or are there other things to take into consideration in Europe?
I think an improvement compared to this year.
Yeah. Second half of next year, improvement over this year's second half.
Yeah.
Clear. Second one from Jacob here. You do not often make press releases around new wins-
Right.
-as you did in October.
Yes.
Should we expect BTS to become more active with these type of announcements?
Yeah, the reason we did that one is because it was material, since the majority would be recognized in the fourth quarter.
Yeah.
I think that will still be our leading principle.
Hopefully.
Hopefully. Excellent. I also have a question on the margin here. You mention in the report that you are progressing towards the long-term margin target. We have talked about that margin target, the 17%, since the peak in 2021, basically. It has been on a declining trend for four years now.
Yeah.
What do you see in the current business model and mix in terms of demand, but also your cost to deliver that is improving the likelihood or potential to actually reaching that margin target longer term? Do you see anything that has changed
Yes
to highlight it today and not
Yes. I mean, it is two reasons. It is we are back to double-digit organic growth.
Yeah.
Combined with the power of going AI-native across our operations. When we replace old tech from the last five, seven, eight years with an AI-native architecture and everything from our engineering function to our help desk, to our journey management for leadership development, to our simulation platforms, it is extraordinarily more efficient and simple to run the business.
I see. So that combination helps in the years to come then.
Yes.
In terms of total OpEx for the group, if we exclude any future M&A, would you say that it is slightly increasing next year versus this year, or can you manage to have it more flattish despite growing the business, or do you see
By OpEx, you mean total costs?
Total costs, exactly. Because I guess there are some offsetting effects in terms of number of employees, but also some productivity savings.
Of course. I mean, we will continue to hire billable consultants and revenue-generating consultants. We will increase salaries. We will make sure we have competitive bonus plans.
Other than that, I don't see any other cost category increasing.
True.
Yeah.
Makes sense. We have another question from Oscar Rönnkvist as well. Any color on the potential margin difference in this large AI deal versus the rest of the business?
I mean, usually with us, when the bigger deals we have, then you get some margin improvement, right? Just with size and scale and efficiencies on the teams. I would say a bit, yes, a bit of improvement.
Okay. Clear. You closed an acquisition here a couple of weeks ago as well, a Swedish company.
Yeah, Edward Lynx.
Yeah?
Yeah.
What do you look for in M&A going forward in terms of the new AI world compared to two years ago? Do you have different criteria for your M&A agenda?
You know, the two buckets we've always looked for is geographical expansion and increasing our portfolio.
Yeah.
Those two buckets still stand and are still very much in demand underneath the new capabilities that we want. As I've been saying, if digital ERP transformation is over here in the Accenture of the world, and BTS has been over here, right, where we never really played in that space other than maybe some change management support. AI era, I think, is coming much closer to our core, which means we can be our client's AI-native workflow product service partner without changing that much of who we are and leveraging the core capabilities of the firm. Maybe it's just looking for great talent. What we're seeing is, even internally and with our clients, it's a combination of early career people who are just free to just maximize the use of tools and not be caught up in old ways of thinking, right?
With people who have experienced really complex workflows in their careers and can also drive kind of the enterprise change around something big like that we'd be looking for. So yeah, probably more talent and then, yeah, I don't Yeah.
Cool. Should we expect like one to two deals per year as historically, or do you see any change of the pace?
No, I think right now we would assume the same pace.
Yeah. Cool.
Yeah.
A final question from me on net recruitment and what you are looking for in hirings. During the last three years, basically the entire market has been looking more for senior competencies and replace some junior competencies-
Yeah.
-with AI tools.
Yeah.
Which has been like a negative pyramid change for many consulting businesses.
Yeah.
What do you look for if you look at net recruitment into 2027? Is it both junior hirings and senior hirings, or any preference for either of these?
It's both. It's both. I never believed that this would be a net negative for the young people in the world, for the record. I think maybe B players or some backend office is at risk or something like that. No, it's both. If I think about who's driven a decent percentage of our breakthrough AI innovations, it's been more early career people combined with a tenured person who knows their domain really well. In terms of supporting our clients, I think it'll be 50/50.
Okay.
Yeah.
Cool. That's interesting. That's all questions from me and from the chat. Thank you very much, Jessica, for the presentation.
My pleasure. Thank you.