French IT services provider Atos has reported a revenue decline for 2024, citing contract cancellations and difficult market conditions as contributing factors. The company’s revenue fell 5.4% to €9.57bn, missing its previous forecast of €9.7bn issued in September 2024. However, Atos saw a recovery in order intake during the final quarter, attributing the improvement to restructuring efforts that bolstered client confidence and stabilised financial operations.
Atos has been a critical IT service provider in Europe and previously had a market valuation of €10bn. However, it currently has a market capitalisation of €600m thanks to years of financial instability, governance challenges, and an unsuccessful restructuring attempt.
Philippe Salle, who assumed the role of CEO last month as the company’s sixth chief executive in two years, highlighted an increase in commercial activity in late 2024. While Atos has not issued a financial forecast for 2025, Salle plans to outline his long-term vision at the company’s upcoming Capital Markets Day on 14 May.
“During the fourth quarter, our commercial activity recovered thanks to the positive change of perception of our clients, who took note of the improvement of our credit rating,” said Salle. “This positive commercial momentum materialised in renewals or extensions of large strategic multi-year contracts.”
Atos’ financial performance and business segments
Atos’ fourth-quarter order intake reached €2.7bn, driving its book-to-bill ratio, which compares new business to revenue, to 117%. Revenue declined across both of Atos’ major business segments during the reported fourth quarter of 2024. Eviden, the company’s digital transformation and cybersecurity unit, experienced a 6.7% drop, while Tech Foundations, which focuses on IT infrastructure and managed services, reported a 4.1% decline. The group’s operating margin stood at 2.1%, amounting to €199m. The company set aside €40m to cover underperforming contracts after discussions with clients.
Atos also recorded a free cash flow deficit of €2.23bn, impacted by the end of previous working capital optimisation strategies and increased capital expenditure on high-performance computing projects. By the close of 2024, the company’s working capital optimisation had decreased to €300m from €1.8bn in the previous year.
Net income for Q4 2024 stood at €248m, largely influenced by financial restructuring measures. Atos reported €3.5bn in restructuring-related income, including a €2.77bn gain from a debt-to-equity conversion and €965m from IFRS 9 debt fair value adjustments. However, the company also recognised a €2.36bn impairment charge on goodwill and other non-current assets, reflecting changes in enterprise value, market capitalisation, and financial liabilities.
Last month, Atos expanded its cybersecurity capabilities through a partnership with Google Cloud, launching a Managed Security Services Provider (MSSP) portfolio. The new cybersecurity services include the Google CloudSecOps Protection Platform, which integrates security features for Google Cloud environments.
Atos is also providing deployment and operational support for Google Security Command Center Premium and Enterprise. Additionally, the company’s Security Operations Center (SOC), powered by Google SecOps, offers round-the-clock threat detection, managed detection and response (MDR), and AI-driven security analysis. The SOC is supported by Atos’ Computer Security Incident Response Team (CSIRT).
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