Pentanet’s Positive EBITDA Marks Milestone Amid Competitive Telecom Market

• First full-year positive EBITDA of $1.4 million, a $2.7 million improvement year-on-year
• 5G subscribers increased 126% to 904, with 25% 5G coverage of tower network
• Consolidated revenue grew 8% year-on-year to $22.6 million
• Gaming segment revenue up 31% and gross profit up 242% year-on-year
• Operating cash flow turned positive at $1.4 million with capital expenditure cut by 67%

Pentanet’s Milestone Year

Perth-based telco Pentanet Limited has crossed a significant threshold in its financial journey, delivering its first full-year positive EBITDA of $1.4 million for FY25. This marks a $2.7 million turnaround from the previous year and reflects the company’s focused execution on high-margin growth initiatives and disciplined cost management.

Consolidated revenue rose 8% year-on-year to $22.6 million, supported by organic growth across both telecommunications and gaming segments. Gross profit increased 15% to $11 million, with the gaming segment notably driving a 242% jump in gross profit, underscoring the success of Pentanet’s strategic pivot in cloud gaming.

Telecommunications Growth and 5G Expansion

On the telecommunications front, Pentanet grew its subscriber base by 4% to 18,157, with a remarkable 126% increase in 5G subscribers to 904. This surge was enabled by a capital-efficient equipment swap that expanded 5G coverage to approximately 25% of the company’s tower network footprint, allowing Pentanet to preserve cash while advancing its network capabilities.

Churn rates improved slightly to 1.23% year-on-year, supported by simplified plan structures and enhanced customer experience initiatives. Average revenue per user (ARPU) also increased modestly, reflecting a shift toward higher-speed fibre plans and improved gross margins following supplier contract renegotiations.

Cloud Gaming Segment Accelerates

Pentanet’s cloud gaming platform, powered by its alliance with NVIDIA’s GeForce NOW, continued its upward trajectory. Gaming segment revenue rose 31% to $2.4 million, driven by a 34% increase in average revenue per user to $19. This was achieved despite an 8% decline in paid subscribers, a consequence of strategic plan restructuring that removed lower-priced tiers in favour of higher-value subscriptions.

The platform’s captive audience grew 23% year-on-year to over 725,000 users, supported by a rich content offering and integration with Xbox Game Pass. Operational efficiencies and plan simplifications have positioned the gaming segment for scalable growth in FY26.

Financial Discipline and Future Outlook

Operating cash flow improved significantly, turning positive at $1.4 million for the year, while capital expenditure was slashed by 67%, reflecting a disciplined approach to cash management amid network expansion. Post-year-end, Pentanet secured a $2 million finance facility to fund its 5G spectrum licence payment, ensuring continued momentum in infrastructure investment.

Managing Director Stephen Cornish highlighted the company’s readiness to reinvest a portion of its growing EBITDA into targeted growth initiatives, including marketing and platform optimisation, while maintaining profitability discipline. With 5G coverage nearing critical mass, Pentanet is poised to accelerate subscriber acquisition efforts in FY26.

Bottom Line?

Pentanet’s FY25 results mark a turning point, but the challenge now lies in scaling subscriber growth and capitalising on its 5G and gaming platforms amid competitive pressures.

Questions in the middle?

• How will Pentanet balance reinvestment in growth with maintaining profitability?
• What impact will broader 5G coverage have on subscriber acquisition in FY26?
• Can the gaming segment sustain its ARPU growth while expanding its user base?