Mach7 Technologies maintains its FY25 revenue growth guidance with strong recurring revenue gains, despite a modest shortfall in contracted annual recurring revenue. The company also advances its share buyback program, signaling confidence in its financial position.
- FY25 revenue expected between A$33M and A$34M, aligning with guidance
- Recurring revenue grows approximately 20%, driving overall growth
- Contracted Annual Recurring Revenue (CARR) slightly below target at A$30M–31M
- Operating expenses growth remains below revenue growth
- On-market share buyback acquires 6.3 million shares for A$2.2M
Steady Revenue Growth in FY25
Mach7 Technologies Limited (ASX, M7T), a specialist in medical imaging software, has provided an update on its financial outlook for the fiscal year ending June 30, 2025. The company expects revenue to land between A$33 million and A$34 million, comfortably within its previously issued guidance range of A$33 million to A$36 million. This reflects a solid 15-25% growth trajectory, underpinned by a roughly 20% increase in recurring revenue streams such as subscriptions and maintenance services.
Slight Shortfall in Contracted Annual Recurring Revenue
While overall revenue growth is on track, Mach7’s Contracted Annual Recurring Revenue (CARR) is anticipated to close slightly below expectations, at approximately A$30 million to A$31 million, compared to the guidance range of A$32 million to A$35 million. CARR is a key metric reflecting the value of contracted recurring revenue, and this shortfall may warrant close attention from investors as it could signal future revenue pressures.
Operational Efficiency and Financial Health
The company reports that operating expenses are growing at a rate lower than revenue, consistent with its FY25 guidance, suggesting improved operational leverage. Mach7 remains debt-free and expects to generate positive operating cash flow for the year, reinforcing its strong financial position. Closing cash is forecasted between A$21 million and A$23 million, providing ample liquidity for ongoing operations and strategic initiatives.
Share Buyback Signals Confidence
In a notable move, Mach7 has initiated an on-market share buyback during the second half of FY25, acquiring approximately 6.3 million shares at a cost of A$2.2 million. This buyback program often signals management’s confidence in the company’s valuation and future prospects, potentially supporting the share price amid market uncertainties.
Looking Ahead
Mach7 plans to release its full FY25 results on July 29, 2025, accompanied by an investor webinar featuring new CEO Teri Thomas and CFO Dyan O’Herne. Market participants will be keen to hear management’s commentary on the CARR shortfall and strategic outlook as the company navigates a competitive healthcare technology landscape.
Bottom Line?
Mach7’s solid revenue growth and share buyback underscore confidence, but the CARR shortfall invites cautious scrutiny ahead of full FY25 results.
Questions in the middle?
- What factors contributed to the slight shortfall in Contracted Annual Recurring Revenue?
- How will the new CEO and CFO address growth challenges in the upcoming investor webinar?
- What impact will the share buyback have on Mach7’s share price and investor sentiment?