FINEOS (FCL) H2 2025 earnings summary

Executive summary

• Subscription revenue grew 8.2% year-over-year to €75.6 million, now 54.6% of total revenue, with ARR up 10% to €78.3 million.

• Total revenue rose 3.9% year-over-year to €138.4 million, with constant currency growth at 6.3%.

• Returned to profitability with net profit after tax of €1 million, reversing a €5.8 million loss in FY24.

• Positive free cash flow of €6.4 million and cash position of €27.8 million, with no debt.

• North America contributed over 80% of total revenue, driven by new carrier wins and client migrations.

Financial highlights

• Gross profit reached €105.5 million, gross margin improved to 76.2% from 75.4%.

• EBITDA rose 50.1% to €30.4 million, with margin up to 21.9% from 15.2%.

• Operating expenses reduced by 6.3%, or €5 million, year-over-year.

• Cash generated from operations improved 40.4% to €38.6 million.

• Services revenue remained stable at €62.2 million.

Outlook and guidance

• FY26 revenue guidance set at €147–152 million, supported by a strong pipeline and locked-in revenues.

• Subscription revenue targeted to reach 65% of total by FY27 and 75% by FY29.

• Gross margin to be retained at 75% in FY27 and increased to 80% in FY29; EBITDA margin aiming for 25% in FY27 and 40% in FY29.

• R&D investment to decrease to 30% of revenue by FY27 and 25% by FY29.

• Focus on growing profitability and cash generation, with continued operational efficiencies.