Interview with F-Secure’s CFO Sari Somerkallio

Can you tell us about your business and the markets you address?

F-Secure is a consumer cybersecurity company that focuses exclusively on protecting end users in today’s complex digital environment. With roots from when the business was part of a combined enterprise and consumer unit, F-Secure now operates as a consumer-focused firm. The Company’s strength lies in delivering a seamless, high-quality security experience that simplifies protection in a world where the internet is increasingly intimidating.

We have a B2B2C model where approximately 81 % of revenue is generated by selling through partners (such as telecom operators) who deliver the solution directly to consumers. As well as direct consumer sales were approximately 19 % of the revenue is coming from. In addition to traditional offerings like VPNs and antivirus (which have become more commonplace and are even built into many devices), F-Secure has many innovative products such as Scam Protection, identity monitoring, password management and many other innovative solutions. This new Scam Protection service addresses modern threats by safeguarding users against online fraud—a critical need given today’s heightened digital risks.

How has your strategy to focus on the partner channel and Embedded Security impacted your growth in 2024?

F-Secure’s emphasis on partner channel and embedded security has been central to the growth strategy last year. By integrating security services into partners’ platforms, we’ve streamlined the customer experience and boosted the market reach. Our business model is very much a win-win. We have a high gross margin—currently around 85%—and our partners also benefit from strong margins. Since we operate mainly on a fee which we get based on our partners growth, every time the partner grows, we grow as well. This creates a mutually beneficial relationship that drives sustainable long-term growth. Although there have been some legacy challenges, the focus on embedded security not only simplifies the offering but also builds a strong foundation for recurring revenue through larger-scale partnerships.

How does your strategy to increase average revenue per user (ARPU) affect your overall growth?

F-Secure is working to drive higher ARPU by evolving the product mix from standalone security apps to a comprehensive, integrated service offering. By merging various services into one unified platform and enhancing it with new capabilities such as Scam Protection, we deliver greater value to the consumer. This supports both customer acquisition and retention, as demonstrated by low churn rates when these services are bundled with essential expenses such as mobile subscriptions. It also enables partners to offer a richer, higher-priced package. The increased ARPU, in turn, supports improved profitability and a more sustainable growth trajectory across both direct channels and partner-driven sales.

Can you describe how you plan to expand your presence within Tier 1 partnerships and what it means for your growth?

Tier 1 partnerships are key to F-Secure’s expansion plans. These partners, which constitutes of large operators and global players with millions of end users, enable the company to scale quickly despite potentially lower ARPU per user. Tier 1 partnerships are crucial for our future growth. We have been investing significantly in strengthening these relationships, as they require a high level of maturity and capability from their suppliers. As we continue to develop this pipeline, we expect it to play an increasingly important role in our expansion. The approach is to create win–win models: partners pay a fixed fee per subscriber, and due to the sheer volume of users, even lower per-user margins translate into significant overall revenue. We select Tier 1 partners based on market reach and volume, ensuring that as these relationships deepen, both recurring revenue and profitability are enhanced.

Where do you see F-Secure in a year, and what is the strategy to get there?

Looking ahead, F-Secure envisions further growth through our partner channel. We expect the share of direct business, currently approximately 19 % of revenue, to decrease in favor of partner-driven sales as the Tier 1 pipeline grows. Continued investments in partner enablement and embedded security capabilities are expected to stabilize EBITDA in euro terms while driving topline growth. Essentially, by focusing on developing a robust Tier 1 ecosystem and refining the service offerings, F-Secure aims to strengthen our market position and create a sustainable, recurring revenue stream. The strategy is built on measurable KPIs such as revenue growth, geographic expansion, and improved profitability through cost control and enhanced service integration.

Can you name three reasons as to why F-Secure is a good investment today?

• Innovative product evolution: F-Secure is not only a leader in traditional consumer cybersecurity but we’re also at the forefront of innovation with products such as Scam Protection that address emerging threats in a dynamic digital landscape.
• Scalable and mutually beneficial partnerships: We have a robust B2B2C model, which ensures access to massive customer bases and stable, recurring revenue streams, backed by strong gross margins on both sides of the partnership.
• Strategic growth and operational resilience: With a clear focus on embedded security, higher ARPU through integrated service offerings, and a strategy focused on partner channels, we are positioned to accelerate growth, mitigate risks, and deliver long-term profitability.