Technology One (TNE) H2 2025 earnings summary

Executive summary

• Achieved record annual recurring revenue (ARR), revenue, and profit for the 16th consecutive year, with profit before tax up 19% to $181.5 million and ARR up 18% to $554.6 million, surpassing guidance.

• Surpassed $500 million ARR 18 months ahead of plan; new long-term target set for $1 billion+ ARR by FY30.

• Strong UK performance with ARR up 49% to $51.8 million and new sales ARR up 52%, driven by SaaS+ and Plus platform adoption.

• Significant R&D investment of $153.7 million (25% of revenue) to accelerate AI-enabled ERP innovation and future growth.

• Dividend up 63% to 36.6 cps, including a special dividend, with payout ratio lifted to 65-75% from FY26.

Financial highlights

• SaaS and recurring revenue up 19% to $553.2 million, representing 91% of total income.

• Total income/revenue rose 18% to $610 million.

• Free cash flow reached $184.2 million, up 55% year-over-year; cash and investments increased 15% to $319.6 million.

• EBITDA increased 18% to $255.7 million; net profit after tax rose 17% to $137.6 million.

• Total expenses increased 18% to $428.5 million, mainly due to SaaS platform costs and people investments.

Outlook and guidance

• Long-term target set for $1 billion+ ARR by FY30, with strong FY26 outlook and further guidance to be provided at the AGM.

• Group margins expected to improve to 35%+ over time, leveraging SaaS+ scale.

• R&D investment to remain in the 20%-25% of revenue range, drifting toward the middle as the business grows.

• Strong sales pipeline and continued investment in R&D to support future growth.