Spacetalk Limited (ASX: $SPA) has reported a 28% increase in annual recurring revenue (ARR) to $9.5m for the quarter ended December 31, 2023. The company also achieved a remarkable 272% growth in Spacetalk Mobile subscribers and a 6% increase in group revenue from continuing operations to $5.5m. Spacetalk's strategic shift to a subscription-based business model has shown promising results, with the company making significant progress on strategy execution and releasing new products. The company's cash in bank at the end of the period stood at $2.9m, reflecting continued momentum towards achieving neutral free cash flow in the second half of 2024.
I am delighted with the progress during Q2 of the 2024 financial year. The positive metrics reflect the focused delivery of outcomes we detailed in our strategy. Our objective is to build a unique ecosystem of interconnected products that deliver safety and security for families. Spacetalk Mobile is the key component that connects the Spacetalk suite of products and Mobile subscriber growth since launch in November 2022 is encouraging. Most importantly it demonstrates our ability to forge enduring relationships with our customers as we transition with them during their key life stages. I am excited about the potential to grow Spacetalk and we are confident that we are on track to deliver our long-term objectives. The 28% growth in ARR to $9.5m continues our momentum to achieving our target of $20m - $25m ARR in 3 years from FY23.
Spacetalk's Q2 FY24 performance has demonstrated significant growth in annual recurring revenue, Spacetalk Mobile subscribers, and group revenue from continuing operations. The company's strategic shift to a subscription-based business model has yielded positive results, with a 28% increase in ARR to $9.5m and a 10% increase in combined App & Spacetalk Mobile subscribers to 70,955. Spacetalk's Chief Executive Officer and Managing Director, Simon Crowther, expressed confidence in the company's ability to achieve its long-term objectives, with a target of $20m - $25m ARR in 3 years from FY23. The company's continued progress towards achieving neutral free cash flow in the second half of 2024 reflects strong working capital management and the enhancement of gross margin and cash generation. Spacetalk's focus on building a unique ecosystem of interconnected products that deliver safety and security for families positions the company for future growth and success.