Zoom2u Technologies Grows Revenue 5% While Embracing Bitcoin Payments

Steady Revenue Growth Amid Operational Challenges

Zoom2u Technologies Limited (ASX:Z2U) has released its Q2 FY25 results, reporting a 5% increase in group revenue to $1.66 million compared to the prior corresponding period (pcp). This growth reflects the company’s continued traction in the competitive Australian delivery services market, driven by its core Zoom2u and Locate2u platforms.

Despite the revenue uptick, the company recorded an EBITDA loss of $29,000 for the quarter, which aligns closely with the previous year’s loss of $22,000. This suggests that while top-line growth is positive, operational efficiencies and cost management remain areas requiring attention.

Cash Flow and Segment Performance Insights

Zoom2u reported positive cash flow from operating activities of $20,000 for the first half of FY25, marking a significant improvement of $811,000 over the pcp. This improvement in cash generation is a critical milestone as the company works towards sustainable profitability.

The Locate2u segment, which provides SaaS solutions for last-mile delivery, demonstrated robust growth with an 8% increase in Q2 revenue to $660,000. Locate2u’s annual recurring revenue has grown at a compound annual growth rate (CAGR) of approximately 38% over the past 18 months, underscoring its rising importance within the group’s portfolio.

Strategic Innovation: Bitcoin Adoption

In a notable strategic move, Zoom2u has adopted a Treasury Management Policy allowing the acquisition of Bitcoin and the acceptance of Bitcoin payments for its services where feasible. This positions the company at the forefront of integrating cryptocurrency into traditional delivery and logistics services, potentially appealing to a broader customer base and enhancing payment flexibility.

The policy reflects a forward-looking approach to treasury management, acknowledging the growing role of decentralized finance and digital currencies in global commerce.

Operational Efficiency and Cost Management

Zoom2u has achieved an 11% reduction in operating expenses for the Zoom2u business over the last twelve months to Q2 FY25, signaling disciplined cost control. Locate2u also reported a 5% reduction in operating expenses over the same period, despite revenue growth, indicating operational leverage.

However, the EBITDA loss and ongoing cash burn highlight the challenges of scaling in a competitive market while investing in technology and service enhancements.

Looking Ahead

Zoom2u’s management has outlined key focus areas for the second half of FY25, including driving the group to cash flow positive status, releasing additional platform functionality, expanding sales efforts targeting small and medium enterprises globally, and implementing cost-saving initiatives such as WhatsApp messaging for customer notifications.

These initiatives, combined with the innovative Bitcoin payment acceptance, suggest a company actively balancing growth ambitions with prudent financial management.