Megaport (MP1) H2 2025 earnings summary

Executive summary

• Annual recurring revenue reached $243.8 million, up 20% year-over-year, with strong growth in the Americas, especially the U.S., which contributed 57% of growth, and significant product innovation driving over 25% of ARR growth.

• Net revenue retention stabilized at 107% for 18 months, with large customers (> $100k ARR) increasing 18% to 629.

• 236 new customer logos were added, a 157% year-over-year increase, reflecting successful go-to-market investments.

• Added 115 new data centers (up 105% YoY), now surpassing 1,000 globally, expanding reach and capacity.

• Customer Lifetime Value surged 50% to $2.1 billion, reflecting robust returns on investments in go-to-market and product innovation.

Financial highlights

• FY 2025 revenue was $227.1 million, exceeding guidance, with 16% growth and currency tailwinds; normalized revenue at $221 million.

• EBITDA reached $62.3 million; normalized/adjusted EBITDA at $57 million, at the lower end of guidance due to accelerated investments.

• CapEx was $34.6 million, mainly for new data centers, network expansion, and product innovation.

• Gross margin remained stable at 70–71% after normalizing for IFRS 16 adjustments.

• Cash at bank stood at $102.1 million, up 41%–43% year-over-year, supporting ongoing investments.

Outlook and guidance

• FY 2026 revenue guidance: $260–$270 million, representing 15–19% YoY growth.

• EBITDA margin guidance: 18–20% of revenue, reflecting continued investment in go-to-market and network expansion.

• CapEx is forecast at 18–20% of revenue, with maintenance CapEx under 3%.

• Free cash flow expected to remain at break-even despite increased investment.

• Strategic focus on doubling down investment in FY 2026 to accelerate growth for FY 2027 and beyond.