Research Solutions (RSSS) Q4 2024 earnings summary

Executive summary

• Fiscal 2024 was transformational, marked by the acquisitions of ResoluteAI and Scite, expanding SaaS and AI capabilities and market reach.

• Achieved record revenue, ARR, and cash flow, with significant growth in platform revenue and adjusted EBITDA.

• Scite outperformed expectations, especially in B2C sales and cross-sell efforts.

• Rebranded for cohesive messaging and integrated product platforms, driving internal alignment.

Financial highlights

• Fiscal 2024 revenue reached $44.6 million, up 18% year-over-year; Q4 revenue was $12.1 million, up 22%.

• Platform subscription revenue grew 61% to $14 million for the year; Q4 platform revenue up 86% to $4.3 million.

• ARR at year-end was $17.4 million, up 84% year-over-year, with $12.1 million B2B and $5.4 million B2C.

• Gross margin for Q4 was 46.5%, a 710 bps improvement; full-year gross margin was 44%, up 500 bps.

• Adjusted EBITDA for the year was $2.2 million, up 11%; Q4 Adjusted EBITDA was $1.4 million, up 70%.

• Net loss for the year was $3.8 million, or $0.13 per share, including a $4.3 million Scite earn-out and $1.5 million proxy/acquisition costs.

Outlook and guidance

• Management expects continued ARR growth and expanding adjusted EBITDA margins, citing untapped market opportunities and integration of acquisitions.

• Expecting some Q1 2025 ARR softness due to B2C seasonality and longer B2B sales cycles, but profit potential remains intact.

• EBITDA margins in low double digits are considered sustainable, with seasonality expected.

• Anticipate continued cash growth in Q3 and Q4 of fiscal 2025, barring acquisitions.