Zoom2u Reports Flat $1.4M Revenue, $0.5M Placement, and AI-Driven Savings

Quarterly Performance Overview

Zoom2u Technologies Limited (ASX:Z2U) has released its Q3 FY25 results, highlighting a mixed but strategically promising quarter. The company’s Locate2u platform delivered a 10% revenue increase to $681,000 compared to the prior corresponding period, offsetting an 11% decline in revenue from the Zoom2u segment. Overall, group revenue remained flat at $1.4 million, reflecting a shift in revenue mix rather than growth stagnation.

Despite the flat top line, operational improvements and cost management efforts have begun to bear fruit. The group’s EBITDA loss narrowed to $91,000 from $156,000 a year earlier, with Locate2u’s EBITDA loss improving by $80,000 quarter-on-quarter. These figures suggest the company is making progress toward its goal of sustainable profitability.

AI Integration and Operational Efficiency

A key theme of the quarter was the deployment of artificial intelligence to enhance both customer-facing products and internal operations. Locate2u rolled out AI-driven features such as a Chat Assistant for natural language queries and AI Image Recognition to improve proof of delivery compliance. These innovations aim to differentiate the platform in the competitive SaaS logistics market.

On the cost side, AI initiatives implemented in early April have already resulted in a monthly staff cost reduction of approximately $41,000. This has been accompanied by a significant headcount reduction from 87 to 68 employees since December 2024. Management signals further efficiency gains are planned through continued AI adoption, underscoring a commitment to leaner operations.

Capital Raising and Strategic Rebranding

To support growth ambitions, Zoom2u successfully completed a $0.5 million placement with wholesale investors and directors, bolstering its cash position to $1.27 million as of 31 March 2025. Notably, $150,000 of this raise is subject to shareholder approval at an upcoming Extraordinary General Meeting (EGM) scheduled for 1 May 2025.

Reflecting the strategic pivot toward Locate2u as the core revenue driver, the company is proposing a name change to Locate Technologies Limited. This rebranding aligns with the evolving business focus and signals to the market a sharpened commitment to the SaaS delivery management space.

Outlook and Market Positioning

CEO Steve Orenstein highlighted the commencement of Locate2u’s deployment with Winning Services (Appliances Online) in Australia, following a successful rollout in New Zealand. This expansion is a critical milestone that could accelerate revenue growth and market penetration.

While the Zoom2u segment faces challenges with reduced enterprise customer volumes, the company’s dual-brand strategy allows it to continue innovating with AI enhancements to improve customer experience and cost efficiency. The integration of AI across platforms is expected to be a key driver for future growth and operational scalability.

Cash flow from operating activities was negative $349,000 for the quarter, primarily due to deferred interest and tax payments. After normalizing for these and other one-off items, operating cash flow would have been positive $134,000, indicating underlying operational improvement.