Bytes Tech Share Chat (BYIT)

Https://www.marketbeat.com/instant-alerts/bytes-technology-group-h2-earnings-call-highlights-2026-05-12/

I think they are doing well under the circumstances of the challenges right now - yes..everything is about looking forwards and new guidance ..but the foundation is there to weather any short term storms .... IMO

I think with some patience we will see the payback on the Microsoft-AI as everyone gets it imbedded and accustomed to it...

Sentiment is very short term based for obvious reasons ....wider the time horizon and sentiment is more positive

That turned quickly, oh well, under 300 will add again. It’s a market down day!

Well the market did like it (that’s a change).

Totally agree, I’m holding and adding, plus it’s not going to be a great day on the market, with world and uk politics!

Could someone please explain to me in laymans terns what the issue was with microsoft incentives was plaease and why there talking about 1 year? as dont understand it. Thanks in advance

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BYIT – Bytes Technology

3*

Bytes reported FY26 GII up 11.5% to £2.34bn, driven by 11.4% software growth and 24.6% services growth, though IFRS revenue rose only 1.6% to £220.5m due to principal/agent accounting treatment. Gross profit, the better measure of underlying sales performance, increased 2.5% to £167.3m, with growth improving from a 0.3% decline in H1 to 4.6% in H2 as the Microsoft incentive headwind eased and the private-sector sales restructure settled. The year was one of transition rather than clean earnings growth. Operating profit fell 5.6% to £62.7m, with the operating profit/gross profit margin declining to 37.5% from 40.7%, reflecting slower gross profit growth and continued investment in people...

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Exane BNP starts Bytes Technology with 'underperform'

Exane BNP starts Computacenter with 'outperform'

Yes you are right, it was spun out of Altron (SA) Dec 2020 Demerger + IPO on LSE (and secondary JSE listing).

Its worth bearing in mind that Bytes is also listed in SA, so that must appeal to these funds. According to my research, the SA's are just more comfortable with this type of business model than the UK is. Also worth noting that Coronation holds a large holding in Quilter plc, which is a near identical set up (ex SA demerger). Possibly - This allows them to trade Quilter shares in Rand (ZAR) without exhausting their individual foreign asset allowances under local exchange control regulations.

Perhaps they can encourage Bytes to de-list from the UK, which might help share price appreciation back in SA. Complete guess on my part.

I think that Byte was originally part of a SA company and spun out in 2020. They clearly want to take back control.

You make an interesting point. Coronation’s holding has now risen to 28%, Camissa’s is steady at 15% and the Public Inv Corp’s holding has lifted to 6% totalling slightly above 49%. Has anyone else noticed all three of these entities is based in South Africa: Camissa and Coronation in Cape Town and PIC in Pretoria. So what do South Africans see in the company that almost nobody else does?

Coronation 23%,Camissa 15%, Public Investment ltd 5%, Biltron 8%, BlackRock 5%, Vanguard 5%, Quilter 3.5% Just short of 70% in total. Are the shorts being used to crash the SP for non fund holders? What is the end game

Apologies, yes, it's unclear where the dividend will land. For 2/27 current consensus is for 18p but with quite a variation around the 12 analysts covering it. The uncertainty is what will be apportioned to a further buy back and what to a divi, either way the money is coming back to shareholders.

Divi is under 4%, only with specials does it rise above this. No Special Dividends have been announced for 2026 yet.

I think it still is a strong buy. The company has flagged a return to more normal levels of growth, the PBT and EPS only held back by an additional £4.5m of additional one of costs. Flushing the £4.5m through would suggest a better out turn than the flat performance the company are steering the market to. That seems sensible, no points for heroic forecast assumptions in this market, and you get a yield of nearly 8% while you wait.

Exactly. Don't count your chickens but already 5% plus up. I'll probably just keep them though as yesterday s buy brought my average down nicely.

Yes Leothecat, just read the Trading Update and cannot see any negatives therein !! What is Mr Market expecting, Revenue up 1000% ?!!

Yes, good spot. I still think their slight increase in the long exposure is still a hedge. Where the sector has been so beaten up according to CNBC the large players are taking small positions.

A bit of an error going above 5% and disclosing their strategy. Anyhow, let’s hope Bytes can get a grip of direct costs and hopefully see some established growth.

All the best, good luck with your investments.

Did you notice the JPM TR1, looks a bit more bullish this time, with equity increasing, and the large part of the swaps for July 2026.

Short covering.

Ha ha - lets keep the rumour going - same here the only blue in the red sea

unlike*****, no idea, but certainly not complaining, as it's only one of my 3 shares out of over 20 that has gone up today !! maybe they've some software that'll terminate the 2 monsters who've started this me war ?!!

Joggers, someone switched the Bot to buy yesterday, the UT was particularly interesting. Be Lucky in Weatherspoons, and of course drink responsibly.

Finley.

What exactly is the point of your posts noggers. Isnt there a Weatherspoon's you can go and meet like minded people in?

Good day today for some reason

Like watching paint dry is this share.

Dartron, I was of the understanding this is an investors blog. Your comments are quite frankly silly. You were posting some 6 months ago that the South Africans were going to take the business and re list it on their exchange.

I told you to pay particular attention to what JPM were doing regarding their interest as they were the people to follow. The old saying ‘follow the money’.

Alas you have convinced yourself that the South Africans are the ‘team’ to follow, you are alas wrong. I’m entitled to raise an opinion on your postings, as quite frankly more inexperienced investors may be taken in by your long statements of in experienced waffle.

The first rule of investing is look at the company and especially the CEO. Alas Mudd, lost confidence with the market by selling a large stake in the business some 18months or so ago, and the share price has been retracting ever since.

I’ve also told you that Microsoft is down 17% year to date, certain software companies, large US are not loved at present and also the U.K. government is probably cost cutting left right and centre in regards to AI investment in certain departments to balance the books.

Datron your systematic of a generation of long winded emails, all spell checked but unfortunately you convey yourself as someone with no business experience, alas there lies the problem.

You post on a public forum, so do expect to have responses and there are most certainly certain individuals who post here with a wealth of business knowledge.

Good luck with your investments.

I can read on Coronations website about their returns, stock picks & investment strategy, but you have no credentials to speak of. Who should I listen to?

"Global Emerging Markets
17-year track record" or "forum troll with 700 posts ?"

Your comment is naive. Coronation are offside and have been caught out with a rather large position in a company that is unloved. The shareprice under £3 tells the story. 0.4% disclosure from short/lent to now long is chicken feed.

See I said they would be trading and front the shorts. Well played.

Coronation Fund Managers back up to 26%.

There is a positive here as others have mentioned Coronation have a significant stake and probably allies with other major shareholders, although they don't have a seat on the board they do and will have influence, the management structure know this and if they are being judged and results matter so as I see it the next update matters if it's we didn't reach our targets then management changes for sure, maybe we become an acquisition target with Coronation requesting the up for sale sign.

However the next update is key.

Seeing as you mentioned it you know what planitir is where it originated and what it will be used for, when the investment currently underway building the Ai infrastructure for 24/7 monitoring of all transactions on a Blockchain network and not just bank transfers, which will require passing a gate keeper to access assets you own eg your house deeds or product s you want to buy, who will be providing the data which will allow you access, and if any authorised entity refuses entry you won't gain access to a asset you legally own or want to buy untill you meet the gate keeper criteria.

" the speed at which chat bots work is amazing, reduces the time in research from days of in depth inquiry to hours."

Michael Burry just wrote a 10,000 word essay on Palantir, which took him days..

He isnt the sort of guy who would trust AI to be able to do it for him , and he certainly wouldnt put the bets on it he does based merely on AI "research"

You wont fully understand a company by merely asking an AI bot

You should read the book, the race to AI. It’s an opinion, it gives you one answer. You don’t make investment decisions or large corporate decisions on that one opinion.

Yes it helps, the world I move in like most successful people we still rely on networking.

There lies the answer, so as I said once large US money, understands that Sam Altman isn’t going to rule the world the market will rally.

Have you tried talking to these chat bots? It all depends on the questions what information you require the speed at which chat bots work is amazing, reduces the time in research from days of in depth inquiry to hours.

Once large US money has worked out that Sam Altman is not going to take over the world shares will rise. It’s that simple a game. The point on compliance made here is very relevant, why would corporate money trust a chat bot, they won’t.

Wealthy individuals and big invested money don’t talk to robots.

Good luck

I dont think the employee size are the problem, in a world of AI, the people are the differentiator. Some AI musings from my last discussion.

The data in early 2026 actually supports your "anti-commodity" view: while the market is shorting the "middleman," the actual revenue flow for Bytes (BYIT) is shifting heavily toward services precisely because large corporates are finding that generic AI tools like Copilot are too risky to deploy alone.

The 52-week low of 288.8p today reflects a "thematic panic," but the company's internal shift from generalist sales to specialist-led segments is a direct answer to your point about "deep tech expertise."

1. The "Complexity Moat" vs. Copilot

The short thesis assumes a large corporate will just "buy Copilot" directly from Microsoft. In reality, February 2026 data shows that as AI moves from "experiment" to "everyday essential," the complexity of governance and security has skyrocketed.

Specialist Value: Bytes reported that its Services business saw gross profit grow by over 40% in H1 2026. This indicates that corporates are paying Bytes for the "expertise" to wrap security and compliance around AI, rather than just buying the license.

Inner Circle Status: Bytes was named a Microsoft Inner Circle Partner for 2025/2026 (top 1% globally). This gives them a "seat at the table" with Microsoft’s leadership to shape product roadmaps, a level of access a generic buyer cannot replicate.

Div-investor, looks like BYIT has bottomed out alright. Think it has dropped recently because of the AI obsession, however BYIT already uses AI a lot and could probably benefit more by cutting staff which I would suspect could be announced when they next report. If the latter, within a broad growth strategy, then there'll be a nice share price bounce !!

If it's guaranteed dividends you should look at SQZ

Bought another £10k at just under £2.91. This may well fall further but I think it’s a good cash generative business for a long term hold. i am still under water by about 13% on this stock after the purchase. Reasonable base dividend and even better if they can keep paying out the special dividend on top. Not sue if it’s getting sold off with the ‘AI will replace everything’ thinking that seems to be pervasive at the moment. As always DYOR.

Every single investor is under water.....

The Bytes Dec20 IPO was significantly oversubscribed. On the first day of conditional trading in London, the share price jumped roughly 22%, closing at 330p, which pushed the company's valuation to approximately £780 million within hours of debut.

"Based on recent reports, artificial intelligence presents a mixed, yet generally advantageous, scenario for Bytes Technology Group (BTG) rather than an existential, imminent threat. While AI is shifting the software landscape by disrupting traditional pricing models, BTG has positioned itself to benefit from the increased demand for AI implementation services and tools.

Here is an analysis of how AI impacts Bytes Technology Group based on findings from 2025-2026:

Why AI is a Catalyst (Not a Threat) for Bytes

Driving Adoption of AI Tools: Bytes serves as a key partner for implementing AI technologies like Microsoft Copilot, helping clients adopt new tools, which drives revenue.

Infrastructure Provider: As organizations adopt AI, they require the "plumbing"—software, cloud services, and security—that Bytes supplies, rather than building it themselves.

Market Demand: The UK's push for public services to adopt AI for productivity is considered a major opportunity for Bytes, which has a large public sector client base.

Cybersecurity Focus: As AI enables more sophisticated cyberattacks, demand for Bytes’ AI-powered security services is increasing.

Potential Risks and Challenges

Pricing Power Erosion: The broader software industry is experiencing a "repricing" of power, where AI makes software outputs cheaper and faster, potentially hurting traditional subscription-heavy revenue models.

Short-term Volatility: While long-term trends are positive, AI-driven changes in vendor partnerships (e.g., Microsoft's rebate changes) have previously caused short-term volatility in Bytes' share price.

Need for Rapid Evolution: Bytes must continue to evolve its skills to keep up with the fast-evolving AI landscape.

Conclusion

Rather than being replaced by AI, Bytes Technology Group is positioned as an enabler of AI adoption. The company is actively integrating AI into its offerings, with its 2025,000+ sold Microsoft Copilot licenses serving as an example of leveraging the technology for growth rather than fearing it. "

A very depressing performance over the last 12 months, especially when compared to how the ftse 350 has performed over the same period. News flow is poor and the”shorts” smell blood. Mudd and Co need to up their game and start delivering more positive updates to avoid the Hamelin town residents revenge - “rise up and give your brains a racking, or sure as fate we will send you packing”

The issue is plain and simple diversity away from Microsoft their plan seems to be half hearted hire more staff to boost the sales team chase more Microsoft clients to make up for shortfall for the reduction in payments received then hoping for the best, while I believe a portion of the new sales teams are pushing their other areas of expertise to move away from total reliance on Microsoft, their updates to the market at H1 and H2 don't cut it, we need quarterly updates and commentary on how this transition is going at current no one knows.

Meanwhile the share price drifts lower due to the impression it is no longer a growth story just a steady earner in a mature market. They have the cash they should use it on a major acquisition instead of throwing it away on buybacks instead the impression they are sending out is lack of ambition with little news flow sort of proves it.

Bytes Technology Group plc, one of the UK and Ireland's leading software, security, cloud and AI services specialists, announces that effective today it is commencing a share repurchase programme of its ordinary shares of £0.01 each ("Ordinary Shares") up to a maximum aggregate consideration of £25 million (the "Repurchase Programme").

Quite a small buy back really. I know they are loaded with cash circa 100M, so why not continue the buy back. It should be on going, indefinitely.

When I look at Bytes one problem I have is the lack of research, or investor relations info. Having said that FDM and CCC both put out updates saying Q4 was stronger than anticipated. Its a cash machine for sure, why not do another buy back. I hope the SA investors are leaning on the board for capital returns.

JP Morgan have hedged their position away, what does that tell you. Short term they see no upside in Bytes. The CEO Mudd

has to deliver on direct cost savings, and get some growth.

Will she, that is the question. My view the trading update will be Luke warm. The South Africans appear to be averaging down, been that play for the last 3/4 months.

Ultimately the CEO has to deliver, it’s not looking good in the short term.

Good Luck.

I have no idea 2hat they are up to but Coronation have 26% and Camissa have 11%, both up from low single digit holdings, so a takeover must be in the offing ?! Trading announcement mid march prior to finals might flush something out. I have a good size holding which hopefully will pay off

Can't really take these broker ratings serious as peel hunt has them as a pick for 2026 and a price target of £6 plus

Jefferies cuts Bytes Technology to 'hold' (buy) - price target 400 (447) pence

Reason for drop today !! I'm holding as I'm confident in this business. Jefferies action doesn't look logical anyway given that their Buy had a price target only 12% higher than Hold that is now their rating !! 400p is also higher than current price as well !!

Lost 20p since yesterday afternoon

Someone sold 700k in the closing auction. Didn't knock us down much.

Would a takeover be in our favour as PI's.... I reaserched it a little but struggled to come to decision either way wether good or bad...

I believe so, hopefully a holdings RNS in the coming days with Coronation upping their stake.

The government selling their stake to Coronation for a potential takeover in the near future IMO.

Is that a good thing?? Whats your reasoning??

Based on today's holdings RNS, I am getting the impression that Public Investment Corporation (South African Government) are selling their shares to Coronation Fund Managers.

Thoughts welcome.

They must do, its a lot for a fund manager to own in one stock and you wouldn't unless you saw very promising future

Coronation up to 25.2% they must like the stock.

Hey, thanks for the info and taking the time to post. I can’t disagree with anything your saying, I’m concerned on JPM position in this affair, those guys are the so called real pros.

I can see this trading lower myself, why, because I think the CEO has already prepared the market for lower expectations, as stated in the last update they need to get to grip with rising direct costs.

Anyhow, all the best with your strategy, I’m Long here also, and if I’m honest I would prefer to be out of it.

Be Lucky.

I think you are missing the point.

Bytes is now over 40% owned by South African institutions. Coronation fund strategically buying up to 24% is not averaging down behaviour. This week we also saw Camissa join the register with 5%. Not to mention we have other historic SA owners - PIC and Biltron. As the thread title says the SA ownership is no coincidence, especially when you consider Bytes was originally a south African company. Altron Limited (through its subsidiary Allied Electronics Corporation Ltd) spun out Bytes Technology Group in late 2020. If you factor in inflation and dividend returns, these same investors are about to take it back cheaper than it was spun out. Bytes is a cash machine, and these guys will take it back. I expect if they delist it from London and just kept it on the JSE the multiple would rerate for them. Bytes is only priced like trash due to hedge funds - The same hedge funds who have let another large holder accumulate stock at cheap prices.

I added again today at 3.50, and now have a good size here. If I see 3.40p, ill add again. Patient capital waiting for an inevitable big move, most likely a take private. With buy backs and dividends its no problem to wait it out.

Coronation – ~24%

Biltron – ~8%

PIC – ~5%

Camissa – ~5%

Well, let’s hope so. I thought Coronation were just averaging down and stuck with Bytes. If they do go let’s get it done before the AI bubble bursts, there are subtle signs of that starting.

Good luck

I have come to the conclusion that bytes have to move away from Microsoft dominated revenue and the only way I can see is by m&a perhaps almost certainly take the other 75% of cloudbride and another more substantial acquisition, the brokers I am sure will of advised this also, Microsoft is going to squeezing margins as it's investments in AI reach mind boggling extremes with no guarantee of success, so to maintain growth we need something else, we have never needed diversity in the past due to growth from Microsoft now we need to offer more the board is fortunate in having a cash pile to spend there are suitable fits out there can the board deliver I will watch with interest if there is any mention of m&a in the news flow.

Bytes have around £80M on the balance sheet, If the head count is high, we should trust them that they know what they are doing.

Its obviously going to be another stock that shorts will just grind in to the ground over the long term. Nothing to do with fundamentals, but they just seem to work the same stocks over and over until they end up on a PE of 5. Its not out of the question this could get a bid one day. Im happy holding, but i wont top up unless shorts take this back down near the 330's.

Must admit am surprised by the slump in price today, this was mostly expected amd flagged

I see it as trying to maximise their footprint in a competitive fragmented market they have the cash to do it plus they are also profitable although you wouldn't think it by the the markets response, over 10% down no wonder companies flee the UK to list elsewhere.

It could be seen as positive but I worry about costs...12% increase in headcount and a dermination to increase further. Ok, more sales team, more sales but more profit is the question.

Looking at shareholding notifications I would not be surprised if an offer for the company arrived in the not too distant future. Now is not the time to sell

£4M UT at £3.90 - interesting.

The prospects are one thing here, but its only half the story. I will watch what the shorts and coronation do next. Im comfortable with my holding, though I have sold all the extra ones I bought in the drop. As an existing holder, im now slightly under water with my original 2024 buys around £4.30, but I like the free cash flow. Im not bothered about growth. Same reason im in GBG. If the market wants to knock it down again, I can buy back what I sold. Dont forget we must be at a cyclical low due to Labour Gov.

Here's a view from ai can't say I disagree they are under pressure from margin decline which is hitting profits even though they are showing revenue growth.

On balance, I think Bytes is being fairly penalised for risk rather than undervalued by mistake. The results are resilient, yes, but not yet turning into a powerful growth story (in terms of accelerating profits) which would justify a premium multiple in a competitive sector.

It might be a decent position for someone who believes in:

long-term structural demand in cloud / AI / cybersecurity;

that Bytes can execute its reorg well and improve margins;

but for more aggressive growth expectations, there might be higher risk.

If I were looking to decide whether to buy, I’d want to see:

how H2 unfolds relative to guidance;

a clearer path for profit margin improvement;

stability or improvement in public sector business given its sensitivity;

signs that vendor terms are favorable;

Raxfactor, looking at buying more now as mystified why the sp has fallen back from nearly 430p. UK businesses deferring capex maybe the reason for BYIT's recent fall, cyber security though a necessary spend surely, because fraudsters will take advantage of any lapses in such spend ?!!

No idea why your name would get starred out.

nice trade unlike*****.

This increased stake in the business imo should be seen as confidence in BYIT moving forwards as their sales pitch for their funds in taking positions in under valued businesses, they must be well versed on what's on the horizon and actually occurring now, if they were expecting a dip in fortunes even though they liked the business model they would hold off further investments, yet of late they are taking advantage of the dip in sp and buyback in increase their holdings.

Coronation up to 21.35 - they have taken just over another 1%, with shorts running at 2.1%

I wonder how this will work out, shorts may feel the price has got ahead of itself, but this is due to the supportive buying. I cant see them being able to crash the price if numbers are not stellar. I had sold a few, as the shorts put me off a bit, but I still hold a decent amount in my pension. I think the signal that Coronation did not want to stop at 20% is very bullish, next stop 25% and short squeeze ?

So are shorts still increasing. 2 firms now. It has probably enabled Coronation to buy so easily, but they are going to hit a limit where they cant buy any more.

Interesting.

Still increasing.

With strong fundamentals, combined with a strong balance sheet, recent insider purchases and the buyback it's nice to see that sp has started to show signs of recovery to a more realistic rating.

Need to pass 400 mark and stay above for the next leg to 450.

Reasonable quantities so a positive sign.