Interview
with André Kudelski
2025 has been a transformational year for the Group. Could you share your perspectives on what made this particular year so significant?
In 2025, we redesigned how our Group, and more specifically the newly constituted Core Digital Security business unit, operates. We took steps to fundamentally redefine the way in which the business innovates, designs, sells and services its clients and partners. Our progress thus far has been encouraging, with initial positive impacts that can be seen in the 2025 financial results of Core Digital Security. Looking to 2026, we expect that same spirit of transformation to further enhance Kudelski Security and Kudelski IoT activities.
We took steps to fundamentally redefine the way in which the business innovates, designs, sells and services its clients and partners.
What are your views on the overall performance of the Group during this year of transformation and repositioning?
2025 was a challenging year due to the overall lack of growth and profitability of the Group. However, the important structural and leadership changes we have made in the past few years delivered some positive results in 2025, namely the improved performance of the Core Digital Security business. This includes the 2.1% growth in absolute gross margin driven by the positive momentum of revenues from new solutions and the success in stabilizing revenues from legacy product lines. Kudelski Security and Kudelski IoT have also undertaken significant transformation efforts in order to better position themselves for the future. In the short-term, the combination of new investments and restructuring activities undertaken by these two business units in 2025 negatively impacted their financial performance, but we believe these actions were necessary to deliver growth and profitability over the long-term.
With the transition of the Digital Television segment to Core Digital Security, merging NAGRAVISION with activities previously managed by Kudelski IoT, could you share your review of this year’s performance?
Core Digital Security represents an exciting new dynamic for the Group, combining the proven performance and market leadership of the Group’s Digital TV business with the leading security technology and innovation team from Kudelski Labs. Not only will this benefit our existing client base with new innovation capabilities and initiatives, but with Kudelski Labs, the Group is well-positioned as a center of excellence to address the growing need for advanced digital security solutions. Overall, in 2025, Core Digital Security was able to improve its performance, enhance its competitiveness and enter promising new markets, which will help build the foundation for future growth.
And in this new context, how do you see the future evolution of Core Digital Security?
The current momentum of the Core Digital Security business is encouraging. The revenues generated by new initiatives are growing at a double-digit rate and are becoming material for the business. At the same time, we have been able to stabilize the slowdown in revenues from legacy product lines. We still have work to do, particularly to enhance profitability while thoughtfully optimizing our cost base to support sustainable long-term performance, but the combination of growing new product lines with the stability provided by our more mature product lines creates a strong foundation for the future.
What is the competitive advantage of the Group’s Core Digital Security business?
Often, the quality of a solution is defined by its weakest link. This is especially true when we consider data and digital security. Our deep expertise in security – from chip technology up to the cloud – is our key competitive advantage. This is particularly important when a digital ecosystem is challenged on a daily basis by hackers and pirates who are not bound by borders, laws or regulations and are able to leverage new technologies like AI. Our goal is to be smarter, faster and more agile than the “dark side” by delivering to the industry adaptive solutions that are secure-by-design with no single point of weakness and future-proof.
Kudelski Security also undertook significant transformation in 2025. Could you share your thoughts on how Kudelski Security is evolving?
Kudelski Security made some significant changes last year, though the impacts are not yet fully visible. The organization has sharpened its focus on high potential growth areas, including OT security and AI-based security solutions, in order to address rapidly evolving market needs and emerging threats. At the same time, efforts have been made to streamline the existing organizational structure, improve operational efficiency, and realize stronger synergies between
European and American activities. Together, these initiatives are designed to strengthen capabilities, enhance scalability, and create a more integrated and resilient business platform for future growth.
With the accelerating market pressures to adopt AI, how is the Group positioned to face and challenge the competitive landscape?
Globally, AI is seemingly everywhere, or at least it seems everyone is trying to adopt AI. For the Kudelski Group, our initial focus has been to embed AI in our solutions at a technological level. For example, AI is now part of how we dynamically manage digital security, simulating the reactions of a digital subscriber twin, analyzing digital media for piracy or monitoring cybersecurity risks. Our goal is to leverage AI capabilities to enhance our products and solutions in order to more quickly and accurately anticipate next steps in a fast-evolving landscape.
How has the Kudelski IoT business evolved in the face of recent volatility in the automotive sector?
Over the last few years, Kudelski IoT revenues have positively developed, but we have also been impacted by significant volatility in the market. In order to improve the resilience and scalability of the Kudelski IoT business, we have undertaken important structural changes to our market approach and developed important new distribution channels with key financial partners that serve the automotive dealer market. This transformation will take time to fully develop, which negatively impacts revenues and profitability of this business in the short term, but these changes are critical over the longer term to improve the working capital needs and profitability of this business.
The important structural and leadership changes we have made in the past few years delivered some positive results in 2025.
What do you identify as the key market trends that will shape 2026?
Intensification of geopolitics has been a major driver of fragmentation in the world. The resulting impacts on society, business and technology have been significant. Technology is also rapidly evolving, with AI and quantum computing in the driver’s seat. The influence of these two technologies on the market is profound, including within the security landscape. Although they deliver meaningful advantages, these technologies also give rise to increased risks when in the hands of hackers and other threat actors pursuing unfriendly objectives. The Group is actively investing in AI to enhance its anti-piracy and anti-hacking solutions. In the field of quantum computing, Kudelski Labs has developed an innovative proprietary technology for quantum safe encryption algorithms, including implementation in chipsets. These are examples of the innovation we are bringing to market in 2026 and beyond in order to address the significant opportunities that we see in today’s rapidly evolving world.
Given the current geopolitical and economic environments, how do you anticipate the international context will influence the Group’s activities?
In 2016, we anticipated the advent of a more fragmented world, which was a key reason for our establishment of a second headquarters in Phoenix, Arizona. We have since witnessed the continuing rise of geopolitical tensions, which accelerated during the pandemic. Today, continental drift is an increasing reality in the world, which requires multinational companies to operate and manage different technology ecosystems in different jurisdictions. This may make life more complicated for many, but it also represents an opportunity for the Group to secure new ecosystems and the interactions between these different ecosystems.
Our transformation efforts over the last year put the group in a good position to continue investing so that we may continue developing and delivering innovative products and solutions to the market.
Do you have any closing thoughts you would like to share?
As a technology company, it is often a challenge to balance short-term and long-term investment plans. The Group has always been committed to investing for the future by privileging the long-term over the short-term with 28% of our annual revenues invested in R&D and fully expensed. Through this approach, we have been able to deliver advanced solutions earlier than our competitors, sometimes at the cost of waiting for the market to materialize. Our transformation efforts over the last year put the Group in a good position to continue investing so that we may continue developing and delivering innovative products and solutions to the market, but this requires patience and perseverance. On behalf of the Board of Directors, I would like to thank our clients, employees, shareholders and partners for their trust and support as we navigate the challenges and opportunities of our journey together.