Harvia's North America Surge Masks Muurame Transition and Gulf Risks

Sauna leader delivers double-digit growth but temporary ERP go-live and geopolitical headwinds complicate the quarter

HARVIA.HE · Earnings Call · 2026-08-06

Quarter 2 2026: A Tale of Two Headwinds

Harvia Oyj reported Q2 2026 revenue of €52.8 million, up 11.7% year-over-year, all organic, with North America again the star performer. The region grew 39% in euros and roughly 42% in USD, driven by its sauna cabin business across both the direct-to-consumer web store and big-box retail channels. In the Q&A, CEO Matias Jarnefelt credited the strength to product-market fit: "I think majority of the growth came from our existing channels." (inline_quote 5936013357950896146) This growth, however, was tempered by two distinct pressures: a major IT and process upgrade at the Muurame heater factory that postponed €4 million of deliveries, and continued geopolitical disruption in the Gulf region that threatens up to 1% of full-year revenue.

North America, obviously, the shining star of the quarter, growing 39% in euros and approximately 43%, 42% in USD.
Matias Jarnefelt, CEO · 2026-08-06

The Muurame transition was deliberate but painful. The three-week production stoppage created high operational leverage for the company, and CFO Ari Vesterinen noted that without the delay, Q2 profitability would have been substantially better. When asked if the delayed volume was secured in Q3, Jarnefelt responded cautiously: "The answer is that I can't guarantee it. But I'm highly confident that majority of it will be delivered in the quarter 3..." (inline_quote 9012486353239045059) Management is already back to near-normal capacity and is building finished-goods inventory ahead of the winter season, which should recover the shift.

Steam and Geopolitical Drags

The Gulf region remains a persistent drag, with APAC and Middle East declining ~5% year-over-year due to project delays. CEO Matias Jarnefelt acknowledged: "When we look at the steam, there's a few things to bear in mind." (inline_quote 5973266777174418572) The infrared sauna category continues to grow faster than steam, which lags due to weaker social-media tailwinds and higher installation complexity. ThermaSol, the steam acquisition, has not delivered the expected sales synergies, though the digital capabilities are being leveraged across the group. In a prior call, the company had already identified tariffs as a key issue: "The biggest impact of the tariffs are for importers who are importing only the heaters for their saunas and for the distribution." (inline_quote from 2025-11-06, component 706420849403685029) Harvia's pricing power has mitigated tariff exposure, but the steam softness is a structural challenge.

Strategic Investments and M&A Appetite

Harvia is investing heavily in capacity, particularly at its Lewisburg, West Virginia, factory, and is pursuing M&A, especially in infrared, where it lacks a meaningful footprint. From the prior quarterly call, CEO Matias Jarnefelt emphasized the ongoing search: "We are continuously in discussions. I hope that in not so distant future, we would have something to report also on this front." (inline_quote from 2026-02-12, component 3816364016761253540) The balance sheet remains underlevered, providing dry powder for acquisitions. The company’s long-term targets of 10%+ revenue growth and 20% adjusted operating margin remain intact, though Q2 margin slipped to 16.2% due to the transition. The quarter illustrates the dual nature of Harvia’s growth story: strong secular demand in North America and a clear path to scaling, but also operational friction and external risks that will likely resolve in the coming quarters. With the winter season approaching and production normalized, the company is positioned to recapture the deferred sales and improve profitability. However, the Gulf exposure and steam weakness merit close watching.