Hi, and Welcome to our quarterly presentation for Q3. I'm Christoffer Rutgersson, CEO of Qliro since a bit more than four years. Today, we'll walk through first some strategic highlights as usual, then some little financials, talk a bit about the outlook going forward, and then we'll move into our Q&A. First of all, we still see a big opportunity to build a new European leader in composable payments, and we're well on that journey on our mission to deliver a world-leading experience for merchants and their customer journey. Secondly, Q3 marks the third profitable quarter in a row, lifting the profit significantly from the investments and losses we saw last year related to the international expansion. Third, we are growing our volume growth by 18% in a quarter.
That could be compared that we were growing 50% in Q3 last year, so also have a quite strong comparable quarter. This growth was primarily driven by SME and our Nordic expansion, as well as driven by a strong growth in our Pay Later products, especially on the BNPL volumes growing 27%. Our gross profit is increasing more than net revenue, growing 37% in the quarter compared to net revenue growing 21% in the quarter, fueled by also the reduction in credit losses that we see as in parallel to the growth journey. Fifth, we'll also talk about the new Consumer Credit Directive. We're well prepared for the implementation happening across the Nordic markets in November. We have also seen similar regulations in the past, and it have not significantly impacted the business historically. So we're quite well prepared for what's coming.
Sixth, we see profitability still for the full year and growth for the full year. However, we do see that we have some short-term headwinds, especially in the enterprise segment, so we expect slightly growth in the short term but expect to be back at above 15% at the latest from H2 next year. First of all, on our vision to become the new European leader in composable payments, we have done significant product improvements during the quarter. I just want to walk through some of them to give you a flavor of where we're heading. First of all, the Checkout Gen 4 that was launched just before summer still sees very strong results and are now out on most of our merchants. For merchants that are shifting to Qliro to competitors, we typically do A/B test, and we see strong conversion improvements for merchants upgrading to Qliro.
We're also doing a big conversion campaign on this now for new merchants. As part of that, we also have our upsell module as well as new validation of consumers and addresses, which is driving this conversion increase. Connected to the Checkout Gen 4, we also launched a variant of a one-click checkout for returning consumers that's now live on a few of our top five merchants with very strong results, and that will be rolled out to more merchants during the coming quarter and for some merchants after the Christmas sales period. Typically, we save the consumer preference for the consumers that are returning, enabling them a quicker checkout for the coming purchases. Third, we are expanding with new payment methods again. We have been a bit stable on this for a while as we have improved our solution in the Nordics.
But as you know, we are enabling Nordic merchants to sell across the globe. We are now taking the next step with enabling more local payment methods across Europe to localize the experience for consumers and hence increasing the conversion in local markets. First out was two payment methods we launched in Q3, BLIK, a local payment method popular in Poland, and Wero, a quite new bank-owned payment method that is launched in Germany, France, Belgium, and is supposed to be launched also in Netherlands as iDEAL is becoming part of Wero going forward. This is improving our competitiveness for all merchants selling also outside the Nordics. Fourth, we announced during the summer a partnership with PPRO, where we are becoming the exclusive BNPL provider in PPRO's networks for their merchants selling into the Nordics.
That is progressing well, and we expect it to be live with the connection during early next year. During the last two years, we have made significant growth investment to expand our sales across the Nordic markets. We launched Norway in Q3 2024. We launched Finland in Q2 2025. We see now that those investment have resulted in profit for 2026 so far, for three quarters in a row. Volume growth is slightly declining compared to previous quarter, but also meeting high comparables in end of last year. We see a strong growth on gross profit driven by the volume growth. We are growing gross profit to, so basically, our net revenue after variable cost and credit losses by 37% in the quarter.
It is that profit growth that is now higher than our fixed cost, and we expect that also going forward as gross profit continue to grow. Even if the volume growth in total is declining in this last quarter, we still see a very strong growth on the BNPL volume growth, which has been lagging a bit behind the total payments volume growth as new consumers are typically starting to pay with an invoice before they start using our BNPL products. We expect the BNPL volume growth to be strong also going forward. The share of BNPL volume is still above 16%, which is an important metric to follow to see how the volume is converting into our most profitable part payment products. A very large share of the volume growth is now driven by the SME segment.
In the quarter, our active merchants grew 90% compared to last year, and that is mostly driven by SMEs. We are now close to 900 active merchants on the platform. In contribution to our net revenue, the SME segment is contributing by more than 100% growth compared to last year, now representing SEK 28 million in run rate in Q3, which is 26% of our total net revenue. We can also see the cohorts here in color. Every color is the cohort of when the merchant was onboarded. We can see that most cohorts are actually still growing or stable in terms of net revenue. A very strong net revenue retention in the SME segment. As part of the SME expansion, we are also selling to SME in Norway and Finland, and of course also enterprise.
Our Nordic volumes are mostly driven by SME, given that the enterprise segments are a bit slower in terms of sales process in new markets. In total, our volume grew a bit more than 20% in Norway and a bit more than 30% in Finland in Q3. Norway is now also profitable for the second quarter in a row on a standalone basis if you look at the local sales and marketing and office cost compared to the gross profit contribution of the local merchants we signed since launch. That is very positive that we are within two years profitable in a new market. We also have strong dialogues with larger merchants and partners in both markets, and we expect the Nordic market expansion to significantly contribute to our growth also going forward.
The second part of our international strategy is also to support our local Nordic merchants to sell across the globe. That is something we have done for many years, but we are now taking the next step and launching more local payment methods for the markets that are most interesting for our existing merchant base. In this quarter, we launched BLIK in Poland, and we are launching Wero in Germany, France and Belgium.
Those payment methods are now live with the first merchants. We are rolling that out on existing merchant base and also using this to be more competitive in new dialogues with new merchants. Given that most of our technology development is now also driven by AI, we foresee that it will be even quicker to launch new payment methods going forward. We expect a fairly rapid expansion of payment methods across the European market in the coming quarters.
Last but not least, during the summer, we announced the partnership with PPRO to become an exclusive provider of BNPL products in their network of PSPs, checkout providers, and global merchants. That is an important part of our strategy to enable European or global merchants to sell into the Nordics using Qliro's Pay Later products, so we can process those volumes on our invoice and BNPL products. That is expected to go live early next year. In terms of revenue and gross profit growth, our net revenue has been accelerated to 21% in the quarter. As part of that, we also see that credit losses are continuing to go down, and it is now on a rate of 0.52 in credit losses over volume, which is fueling the gross profit growth even more than the net revenue growth.
We have a gross profit growth of 37% in a quarter, which is more in line also with the growth of our BNPL volumes. There is a new regulation coming. There has been a lot of news about this across the Nordics and Europe during 2026, the revised Consumer Credit Directive. Qliro is well prepared, and we are adapted for the new regulation coming into force on 20th of November. We are quite experienced also with similar regulation, and most of the components in this regulation have already been enforced in bits and pieces across the Nordics. We have seen most of it before, and it has not really impacted the consumer and merchant experience. We are quite comfortable with the change that is coming, even if we are now rolling out a couple of changes across our solutions, both towards merchants and consumers across Sweden, Finland, and Denmark.
Norway have not announced when they will adopt the regulation, but that will also probably come a bit later. The maybe most significant element of this is that we will have slightly stricter credit assessment by more external data. We are already doing credit assessment on all our transactions, but we are not buying the full data that the new regulation requires, which means we will probably have SEK 5 million-SEK 10 million in additional variable cost going into next year compared to the past. That may be the most significant financial impact that we expect from the regulation. However, we also see slightly longer sales cycles in the enterprise segment. Typically, when large enterprise merchants are choosing new providers, they want to be certain about everything.
CCD2 is introducing some uncertainty about both how different players are integrating the regulation and how that may affect the consumer experience and the merchants. Most larger merchants prefer to wait a bit until this is fully certain and you can see everything. Probably we expect one or two more quarters before a pickup in the enterprise segment for larger merchants. In terms of guidance, we are still guiding on profitability and growth for the full year 2026. In the short term, we expect a slowdown on net revenue growth, both due to the previously announced churn in the enterprise segment, as well as that we see longer enterprise sales cycles due to the uncertainty around CCD2 that will probably stay here until year-end.
We also have some temporary positive effects from earlier this year that are tapering off, and it has impacted comparables in the coming quarters. However, we expect net revenue growth to be back at at least 15% growth rate by the second half of next year. That is basically only driven by our strong underlying momentum in SME. New enterprise agreements or platform and partner deals will add further to that growth. We are not accounting for that now before we see it, that is fully opening up again. Let us jump into the financial details. I mentioned a lot of this already. Our volume growth is growing 18% in the quarter, net revenue 21%, credit losses are fairly stable in absolute numbers, even if you are going down on credit loss ratio of 15%. Our GP2 is growing 37%, so gross profit is still above our fixed cost.
We are making a small profit in the quarter. The operating profit is hence increasing quite significantly compared to the losses we made last year when we were still investing aggressively in growth across the Nordics. The loan book is growing 9%, so we see a small acceleration in the loan book growth, but the loan book is still growing slower than our Pay Later and especially the BNPL volume growth, given that we see a slightly shorter duration in the loan book, both given the current product mix, as well as that as more consumers are paying on time and we see less credit losses, that also builds up slightly lower loan book. Overall, that is increasing also the gross margin on the loan book, which is very positive. The loan book is now more profitable than before on average.
We also see that the BNPL volume as share of TPV is on a higher level than we have seen in a long time, which is very positive, because these are the most profitable part of our transaction volume. As mentioned, net revenue is growing at 21%. It looks fairly stable over the last few quarters, but typically we see a big uplift with the seasonal sales in Q4 and then building up also the profits and net revenue into Q1. On credit losses, as mentioned, in absolute numbers, stable compared to last year, but our debt collection ratio is also declining 13% compared to last year. The debt loss ratio compared to volume is declining 15%. It is very positive that we still see debt collection rate also coming down further because that we expect to materialize into lower average losses going forward.
We still have expectations for any further improved credit loss performance also from a financial perspective going forward. On the cost side, we have been very disciplined on cost control. The total cost in the quarter is SEK 93 million. Sales and marketing is slightly up, so we are very effective on our other fixed cost. We expect also to continue to be very strict on cost control until we see larger profits going forward. This is also very much driven by our AI investments internally. We are implementing AI across all teams, all processes, and we see large gains from this, especially on the product and technology side, where we reduced CapEx very significantly last year. But we also see the impact on that now in a lot of processes across the organization. That is enabling us to scale without adding a lot of fixed cost.
From a profit perspective, we are now profitable three quarters in a row. Fairly small profit, but a big difference compared to the losses we were seeing last year, given the investment we were then making in the expansion. From a CapEx perspective, as mentioned, we are now very effective on CapEx. We are down from SEK 33 million last year in Q3 to SEK 21 million this year, very much driven by a rollout of AI tools across our product and tech teams. We are actually seeing a larger output from our tech teams now than a year ago, despite the lower CapEx. On the capital side, we are still well capitalized given the rights issue we did during the spring, and that we are now profitable. Let us move back to the outlook.
If you look ahead, we are working hard to continue to accelerate our SME sales engine and get the enterprise kind of processes moving forward. We want to continue to build our growth momentum on the early success in our launch in Norway and Finland, and we are also expanding with more local platform partners, which is expanding our addressable market in both Norway and Finland. Initially, we have been selling mostly towards merchants that are using either global e-commerce platforms or Swedish e-commerce platforms that we have already been integrated with in the past, but we are now getting connected to more and more local platforms, which is significantly expanding our opportunity to sell in the local markets. We are also continuing to focus on initiatives to accelerate income generation, improve scalability, and efficiency, and we are still guiding on profitability and growth for the full year 2026.
Short term, however, we expect a slowdown in the net revenue growth as mentioned, and we expect to be back to at least 15% net revenue growth by the second half of next year. Thank you.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more phone questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.
Okay, we have a few written questions. First of all, are you still expecting SME growth to remain solid given that your guidance for 50% growth in H1 next year seems to exclude larger enterprise deals? Yes, we see a very strong momentum in our SME sales engine across all Nordic markets, and we expect that to continue or accelerate. Also have a question regarding regulatory reductions on our Common Equity Tier 1 Capital, and that's primarily on prudent amortization of intangible assets as well as the cost of our additional Tier 1 capital. We also have one question about the development of Stage 3 loans, and that is primarily a difference between how much of the Stage 3 portfolios we're selling in the quarter compared to previous quarters. Thank you. If there's any other questions, don't hesitate to reach out to our investor relations.
Wish you all a nice day, and we'll get back after next quarter. Thank you