Boardwalktech Software (BWLK) Q2 2025 earnings summary

Executive summary

• Focused on a land and expand strategy leveraging SaaS licenses for high-margin recurring revenue and deepening relationships with Fortune 500 clients.

• Transitioning sales model toward partner teaming with major IT firms like Tata Consultancy Services and HCLTech to accelerate sales cycles and reduce costs.

• Velocity product gaining traction in the financial sector, notably with a top five U.S. bank, driving compliance and ROI benefits, with over 1,000 users and a multi-year engagement underway.

• Anticipates higher growth rates and similar margins based on strong sales pipeline visibility and new tier one bank discussions.

• Adjusted EBITDA loss improved to $(0.37) million, a 10% sequential improvement.

Financial highlights

• Q2 FY2025 revenue was $1.3M, down 16% year-over-year but up 2% sequentially from Q1.

• Annualized recurring revenue (ARR) at $4.6M as of September 30, 2024.

• Gross margin for Q2 FY2025 was 88.6%, up from Q1 but slightly down from 90.1% in Q2 last year.

• Net IFRS loss for Q2 FY2025 was $0.7M ($0.01 per share), a 10% sequential and 1% year-over-year improvement.

• Cash flows from operations were a positive $219K, a 24% improvement year-over-year.

Outlook and guidance

• Expects increased revenue and business improvement in 2025, driven by proven technology, expanding client base, and partner ecosystem.

• Focus remains on achieving cash break-even and positive Adjusted EBITDA with modest revenue growth assumptions.

• Anticipates further cost savings from measures implemented in January 2024.

• Ongoing multi-year engagement with a top 5 US bank is expected to drive further growth.