Defensive in Germany, pension reform provides additional upside

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Defensive in Germany, pension reform provides additional upside

Marketing & Customer Growth

Market concern has centred around elevated customer acquisition cost (CAC)

within Q126, driven by heightened competition within Germany. We expect CAC

to normalise from Q226, with a seasonal weighting towards the beginning of the

year. We further expect marketing cost to be normalising with similar %

allocation to revenue, rather than structurally increasing. In addition, we highlight

the margin expansion trajectory, providing room for higher marketing spend.

CAC and marketing expense normalising

FTK reported elevated CAC in Q126, reflecting heightened competition and seasonal

front loading of marketing spend. Marketing expense was EUR21m in Q126 (vs EUR12m

in Q125), consistent with management’s guidance for an additional EUR10m in 2026.

Despite higher costs, customer growth remained steady which drove an increase in cost

per acquisition to ~EUR170 per client. We see higher cost per customer as cyclical and

driven by current competitive intensity within Germany amidst the emerging pension

reforms. Management have further reported a normalising customer acquisition cost

since Q126, reinforcing our view. We expect CAC to return to ~EUR91 In Q226.

Market concern has also been around structurally higher marketing costs, which we see

as overdone. FTK has underinvested in marketing since 2023, with focus on the BaFin

audit. As such, the recent increase should be seen in the context of a normalisation in

investment levels rather than a step-change in the cost base. Importantly, despite higher

absolute spend, marketing intensity as a percentage of revenue remains broadly stable,

highlighting the improved earnings capacity of the business. This is further supported by