Jättebra! Då kör vi. Before we will begin, sorry. Then we will start, and we have to excuse ourselves for our malfunction here in the beginning. I think we went halfway through the presentation, me and Tony, until we realized that there was no sound. Hopefully you can hear us now. Good morning, everyone. Thank you very much for your patience, and welcome to the MSAB's presentation of the quarter three results and report. My name is Peter Heuman, and I'm the newly appointed CEO as of first of October. That will probably tell most of you that I have not been part and cannot, unfortunately, take any credit for, in my view, a very solid quarter three report.
I will still provide you with a summarized view of the results, but all the details, and perhaps all the credits, should go to my new colleagues and maybe even more to my CFO, Tony Forsgren, who is with me here on the call. So if I should provide you a little bit quick now with an informal agenda, I will, like I said, summarize, one slide on the quarter three report, then Tony will provide you more of the details of the performance during quarter three. And then I will at the end, come back about some of my early observations and findings, and also touch upon what you can expect from me and the company going forward. And last but not least, we will open up for a Q&A if we get the technology here to work. Hopefully, we do.
But without further ado, I will hand over to the next slide to myself, I think. There we go. So the quarter three for MSAB: solid revenue growth of 15%, and even FX-adjusted, I think it's in line with the TAM and the market growth, which is a good sign. I think it's also a good balance between new sales and renewals, where new sales is almost 50%, something when I have prepared myself and studied historic reports, seems to go in the right direction in this report. The same for the gross margins and a high level of EBITDA, if I also look at the historic reports, and I think Tony will talk more in details about this, and also about the countries where we see most of the growth.
But one important thing that I have also realized and seen and met when I have already met some customers is that during quarter three, the company made a successful update and release of some of our most important products, the XRY Pro and the XAMN, meaning the extraction product and the analyst product. And I have directly with customers seen that this have received a great customer response. So without further ado, I will hand over now to Tony.
Thank you, Peter. So here we see the P&L for the isolated Q3 compared with Q2 last year. We see a revenue growth of 15%, which is the second best quarter in the history for the company. The FX-adjusted growth is 10% in the quarter. Gross margins are high due to a product mix, including higher software share. We are talking about hardware earlier, and we don't aim to have that as much in the P&L as we want. We want to have a high software share since we are a software company, so we are very glad to see that we have high gross margins in the quarter. And also, it's down to the EBIT. The EBIT margin is 23.2%. Also, that is really high compared with history.
So, we are glad to see that, the costs are not falling through. Strong balance sheet and good bank cash position. The cash flow improved compared with Q3 2022, and looking at rolling 12 numbers, we have a good cash flow during the year. Also, the DSO is improved continuously, and we keep on focusing on having a good DSO level. Here we see the net sales per income type. We're really glad to see the balance between new sales and license renewals. We have 46% new sales, and the license renewals ended up on 54% in the quarter. It's a stable growth in all peers. And when we see a little bit more in the new sales, it refers mainly to new customers in Australia and Canada, markets which we haven't had that much presence in earlier.
It's been really focused on U.S. and U.K., but really glad to gain market in Australia and Canada. It's connected also to the MSAB Office and the XRY Pro products, which were really... Yeah. The license renewals have increased, as I said, driving mostly in EMEA, especially in U.K. and Germany. The U.S. has declined in license renewals, but that's also referring to a periodic effect where we have the budget year in Q3, Q4 for U.S., so we're looking forward to see that coming in Q4. Authorities in Canada, Australia have extended and expanded their agreements also, which are gaining the growth.
Okay. You're done, Tony?
Yeah.
I think this is almost the last slide. Like I promised, some of my early observations, having been here only for 20 days, I have, of course, done some preparation. So I think I would, I would summarize it a little bit like the following. As we, as you even heard me say, I find it a strong and stable report, and the company is in a very financially stable position. I have, as a newly appointed CEO, launched a classic 90-day program, and I'm 20 days into that. I have already, during these early days, identified and found strong assets in the company, especially when it comes to innovation and technology capabilities, but also in certain customer segments and related to customer satisfaction. And this encouraged me a lot.
But I would say that one of my highest priorities is to gain back and to sustain a higher market share for MSAB. And that must mean that there is work should be things that can be improved for the company. And I would say the answer to that is clearly yes. I would now try to summarize where my focus and why I have this focus in how we should sustain and gain a higher market share. Because it's... What I believe is, if you want to succeed as a global software product company, you need to succeed primarily in two dimensions. Number one is you have to be number one as a company then, because clearly today, we are not the market leader. We might have been there historically, but we are not with the current market share, and that's why it's a priority for me.
But it tells me that we have to be more productive in company. We need to focus, more focus is required, and potentially more investments is required in our products to make sure, because we're going to have to have some of the best products in the market to gain more market share. I think this is crucial for any product company that want to succeed globally. That tells me I'm going to put a lot of focus in that, and I already started that in my 90-day program. The other aspect I think is extremely important is when you're starting to grow as a company, maybe having a historic successful start, but then you might end up losing a little bit of your, of your ability to keep yourself, in the culture and in the company, very customer-driven.
You're going to have to have great products, and you need to be very customer-driven. I hope that my global and international experience can help us to secure that we allocate resources and dollars better to ensure that we become an even more customer-centric culture. And maybe in spite of the improvements that I see are required for us to succeed, but maybe even more in combination with some of the strong item, already identified assets, my intention is to more effectively run a global operation while we continue to invest in our products and in our customers in an improved way.
So I think with a combination of having this focus with the strong assets I found, I would like to positively summarize it, also looking at the report, that my belief is that there is a lot of untapped potential in MSAB, and that's what I'm going to try to explore in my 90-day program, how we can best utilize that. So to end up, since I've only been here for 20 days, I don't provide you with any kind of detailed guiding for quarter four or going forward. But I am to provide you much more guiding when my 90- 100-day program is completed and we start 2024. And I look forward to comment more around this during our quarter one presentation. So with that, I think we are done with our actual presentation. Maybe it's a bit short today.
Hopefully, when I've been here a little bit longer, I put myself way deeper into the organization, to our products, et cetera, we can spend a little bit more time on that, on our roadmaps and things like that. I don't dare to say too much about those things 20 days into the office, but I really look forward. I'm excited, and like I said, I think there's a lot of untapped potential in the company that we're going to try to let loose on a global level. With that, I think we are open for Q&A. If we have someone here in the chat, you can use that one. I know that Tony has received a few questions over email, but let's see if someone here who is with us would like to ask any questions.
Feel free to do that and raise your hand in the chat, or we can open up to you so you can communicate with us. If we don't see that, then maybe we should start with Tony.
Yes, sure. There are two questions here for you, actually, Peter. How are the new sales actually going? It looks like most revenue comes from license renewals.
Yeah. Okay. Yeah, I can answer that because I can see what we have done in the report and what, what has been generated. But, I mean, in this report, I think it's going in the right direction. I think the new sales is almost, almost up to 50%. I think it, it... The way I look upon it, if you have a high rate of renewals, it's very good. That, that tells me that we are close to customers, they are happy with the products, and they are renewing and upgrading. That is a good sign.... If you look historically, and like I said, if we should gain a higher market share, we have to be very focused on trying to strive for increasing the new sales.
I don't think I should comment right much more right now, but that's gonna be a priority in the company forward. But I think quarter three looks like it's heading in a positive direction.
Thank you. The other question, is: What will MSAB do with its well-stocked cash?
Yeah, you know, we, we can look upon it in different ways, but if I should refer to what I just talked about and these dimensions where I think we, we need to start to focus on, I might see ways how we can run a more efficient company, so that might generate some free cash flows. But like I was also trying to be fairly clear, I think we need to dare to invest more in our products that will help us to gain market share. It's a balance here. On the global level, is it a large pool? If I look at some of our competition, is it- it is a solid company. Are the numbers big and strong enough to really start to compete on a global level? I think that's the balance that I'm trying to analyze.
I, I believe from a starting point, we are starting from a good asset level.
Thank you, Peter. Is there any other questions from the audience live?
You can raise your hand, and we will see if you want to ask a question.
No? That's fine. Very good. We had a few questions. We had a little bit of a technical hiccup. Let's see if we can try to make sure we improve that going forward. We apologize for that, but thank you very much, everyone, for joining, and we look forward to meet you all again during our quarter one presentation. So thank you very much for joining.