Tecsys (TCS) Q1 2025 earnings summary

Executive summary

• Q1 FY2025 delivered strong SaaS revenue and bookings growth, with SaaS revenue up 33% and bookings up 57% year-over-year, driven by broad participation across key verticals and a focus on healthcare and pharmacy expansion.

• Major healthcare migration secured with a large IDN, continued pharmacy sector momentum, and a competitive win-back in distribution.

• Robust backlog and RPO up 40% year-over-year, supporting growth and guidance.

• Strategic hires and board additions, including a new Chief Strategy Officer, to drive SaaS and data initiatives and reinforce company culture.

• Recognized as a 2024 Great Place to Work in Canada, U.S., and Denmark.

Financial highlights

• SaaS revenue reached CAD 15.3 million (up 33% year-over-year); SaaS bookings were CAD 3 million (up 57%).

• Total revenue was CAD 42.3 million, a 1% increase year-over-year; hardware revenue declined 41%.

• Professional services revenue was CAD 13.4 million, down 10% year-over-year, but bookings in this segment rose 25% to CAD 17.2 million.

• Gross margin improved to 47% from 46% year-over-year; combined SaaS, maintenance, support, and professional services margin was 49%.

• Net profit was CAD 798,000, down 32% year-over-year; adjusted EBITDA was CAD 2.6 million, down 18%.

• Cash and short-term investments totaled CAD 27.1 million with no debt.

Outlook and guidance

• Reiterated FY2025 guidance: total revenue growth of 7–9%, SaaS revenue growth of 30–32%, and adjusted EBITDA margin of 8–9%.

• FY2026 adjusted EBITDA margin guidance remains at 10–11%.

• Strong sales pipeline and backlog support confidence in achieving guidance.

• Continued investment in product innovation, data capabilities, and customer satisfaction.