OVHcloud eyes faster 2027 growth as it posts first positive cash flow since IPO

By Leo Marchandon

Oct 20 (Reuters) - French cloud operator OVHcloud reported its first positive levered free cash flow since its 2021 listing and forecast accelerating revenue growth for the year through August 2027, lifting its shares more than 10% on Tuesday.

The milestone means OVHcloud, Europe's biggest hyperscaler seeking to challenge the likes of Microsoft Azure, Google Cloud and Amazon's AWS, now covers its heavy capital spending from its own operations after five years of losses on cash generation.

OVHcloud's shares have more than doubled in value since the start of 2026.

The company's revenue grew 7.2% to €1.15 billion ($1.29 billion) in the fiscal year that closed on August 31. It expects to exceed 10% growth in the current year, along with continued positive cash flow generation.

Acceleration in fourth-quarter growth was led by the Digital Scalers segment, CEO Octave Klaba told Reuters, following the reorganisation of the company's offering since his return a year ago.

Digital Scalers, which serves clients spending more than €2,000 a month, posted comparable revenue growth of 12.4% to €359.1 million and made up 31% of the company's sales. Public cloud revenue rose 18.9% to €255.1 million.

Klaba said the year had been one of discipline and OVHcloud had "returned to its fundamentals".

Levered free cash flow reached €24.7 million, against an outflow of €27.0 million a year ago. Adjusted earnings before interest, taxes, depreciation and amortisation rose 9.7% to €480.5 million, resulting in a margin of 42.0%. For fiscal 2027, it aims to raise the margin to above 42.5%.

Net debt stood at €1.16 billion, or 2.7 times its adjusted EBITDA, compared with 2.9x at the end of the previous fiscal year. The company has €255 million in available liquidity and no significant debt repayment due before fiscal 2030, it said.

($1 = 0.8904 euros)

(Reporting by Leo Marchandon in Gdansk; Editing by Christian Schmollinger and Milla Nissi-Prussak)