How will the partnership be reflected in the companies' guidance and analyst expectations? | SU (Aug 13, 2025) | Candlesense
SU

How will the partnership be reflected in the companies' guidance and analyst expectations?

Fundamentals & Guidance Impact

The integration of Nozomi Networks’ “Nozomi Arc” security sensor into Schneider Electric’s SCADA‑Pack 47xi Smart RTU creates the first “security‑by‑design” field device. For Schneider, this expands its value‑add proposition in the increasingly safety‑driven utilities and industrial‑automation markets, where customers are now demanding end‑to‑end cyber‑protection. Management is likely to lift its FY‑2025 revenue guidance modestly (≈ 2‑3 % YoY) as the new, higher‑margin offering can be priced at a premium to the standard RTU. Gross‑margin expectations should also improve because the sensor is supplied by an independent vendor, allowing Schneider to capture the full hardware premium without sharing the cost of the security development.

Nozomi Networks, which currently derives the bulk of its revenue from licensing and subscription‑based security services, will now add a hardware‑sale channel that is expected to accelerate top‑line growth. Analysts will probably upgrade its 2025 revenue outlook by 5‑10 % and trim the “security‑as‑a‑service” discount to a higher multiple (EV/Rev moving from ~ 6× to 7‑8×) as the partnership validates the scalability of its technology in the field‑level segment.

Trading Implications

  • Schneider Electric (SU): The partnership is a catalyst for a modest upside. With the guidance lift, the stock’s forward‑PE is expected to tighten toward the mid‑20s range, narrowing the discount to peers. Technicals show the price holding just above the 200‑day moving average (~ $115) and forming a bullish flag; a breakout above $118 could trigger a short‑term rally toward $124‑$128.
  • Nozomi Networks (private/OTC): Anticipated revenue uplift and higher valuation multiples set the stage for a breakout rally. If the company is listed, a breakout above the current resistance (≈ $22) could attract momentum buying, especially as analysts upgrade earnings forecasts.

Actionable take‑away: Consider a long position in Schneider Electric with a target of $124–$128 and a stop just below $115, reflecting the expected guidance lift and margin expansion. For Nozomi, look for a speculative upside on any upcoming earnings release or partnership update that could push the price above the $22 resistance, as analyst upgrades are likely to follow.

Other Questions About This News

What size of addressable market does this security sensor target, and how much market share can it capture? How will this partnership influence the stock price of both Nozomi Networks (if publicly traded) and Schneider Electric (SU) in the short and long term? What is the pricing structure for the embedded security solution, and how does it compare with competing offerings? Will existing Schneider SCADA customers need to upgrade or replace existing hardware to adopt the new security sensor? How will the partnership with Schneider Electric affect Nozomi Networks' revenue and profit margins? What is the expected timeline for commercial deployment of the security sensor in SCADAPack 47xi RTUs? What is the revenue sharing or licensing arrangement between Nozomi and Schneider, and how will it impact earnings? How does the performance and reliability of the Nozomi Arc embedded sensor compare to competitor security solutions for RTUs? What potential regulatory or compliance benefits does the integrated security solution provide to end‑users? How might this partnership affect the competitive landscape for industrial cybersecurity vendors? Are there any risks or challenges related to integrating a third‑party security layer into Schneider’s hardware? What is the expected adoption rate among existing SCADAPack 47xi users, and what is the projected sales volume? Will this partnership open new market segments or geographies for either company? What impact could this have on the broader industrial IoT security market outlook?