FINEOS (FCL) H1 2025 earnings summary

Executive summary

• Revenue for 1H25 rose 4.2% year-over-year to €67.1 million, driven by growth in subscription and services revenue, with North America and APAC as key contributors.

• Subscription revenue increased 5.7% to €36.4 million, now 54.3% of total revenue.

• Gross profit reached €51.4 million, up 8.4% year-over-year, with margin improving to 76.6%.

• EBITDA surged 80.1% to €13.1 million, with margin up to 19.6%.

• Net loss after tax narrowed to €1.3 million from €5.3 million in the prior year, reflecting improved profitability.

Financial highlights

• Annual recurring revenue (ARR) increased 11.2% to €76.4 million as of June 30.

• Services revenue rose 2.6% to €30.4 million.

• Operating expenses fell 4.7% year-over-year, supporting margin expansion.

• Net cash from operating activities increased 73% year-over-year.

• Cash position at €34.9 million as of June 30, 2025.

Outlook and guidance

• FY25 revenue now guided to the lower end of €138m–€143m due to FX headwinds and macroeconomic uncertainty.

• Positive free cash flow expected for FY25, with sustained annual profitability from FY26 onward.

• Recurring revenue targeted at 65%+ by FY27 and 75%+ by FY29; gross margin at 75% in FY27 and 80% in FY29; EBITDA margin at 25% in FY27 and 40% in FY29.

• R&D as a percentage of revenue targeted to decrease to 30% by FY27 and 25% by FY29 (currently 37%).

• FY25 costs expected to decrease compared to last year.