ikeGPS Group Limited (IKE) (ASX: $IKE) has reported its financial results for the 12 months to 31 March 2024, with a revenue of approximately NZ$21.1m, representing a 31% decrease compared to the previous corresponding period (pcp). The company's subscription revenue saw a positive growth of approximately 21% vs pcp, while transaction revenue experienced a decline of about 61% vs pcp. Despite a net loss of approximately NZ$15m, IKE maintained a strong balance sheet with total cash and receivables of NZ$15.4m as at 31 March 2024. The company's CEO, Glenn Milnes, expressed optimism for the future, highlighting the closure of multiple contracts that are expected to drive over 50% growth in Software as a Service (SaaS) revenue in FY25.
IKE CEO Glenn Milnes noted that the company experienced a stronger performance in Q4 FY24, with the closure of significant subscription contracts with tier-1 North American electric utility customers. Although these contracts did not materially impact the recognized revenue in the FY24 period, they are anticipated to substantially contribute to the growth of FY25 subscription revenue run rates. Milnes highlighted the reduction in revenue from lower margin transaction revenue in FY24, attributing the 61% decrease vs pcp to outsized activity from certain customers in the previous year. He emphasized the company's expectation for transaction volumes and associated revenue to build into FY25 based on guidance from long-term customers. Milnes also discussed the success of the new IKE PoleForeman product, with over 2,500 additional subscribers and several major subscription contracts closed, contributing to a positive outlook for FY25.
IKE's FY24 financial results revealed a mixed performance, with a decline in overall revenue but a notable increase in subscription revenue. The company's CEO expressed confidence in the outlook for FY25, anticipating strong growth in subscription revenue, driven by the success of the IKE PoleForeman product and ongoing growth of the core IKE Office Pro subscription product. Additionally, IKE expects transaction revenue to grow in FY25, albeit with a wider range of potential growth profiles. The company's margin profile improved in FY24, and it foresees this trend continuing into FY25, resulting in a material improvement in margins. Furthermore, IKE is poised for an exciting period in FY25 with the expected introduction of new AI-based automation capabilities into existing and new products. The company remains optimistic about the supportive macro-market tailwinds across North America and the forecasted investment in distribution power network capacity, positioning itself for continued growth and success.
 Not sure about a 50% jump in revenue next year. Seems optimistic, but their new product sounds interesting.
Looks like ikeGPS is betting big on subscriptions. Hope it pays off for them!Â