Vection Technologies Hits Record $10m Orders Amid Defence and AI/XR Surge
Vection Technologies capped FY25 with its highest monthly order intake ever, driven by defence and AI/XR contracts, while posting positive pro-forma cash flow despite payment timing issues.
- Record $10m+ monthly orders in June 2025
- Largest FY25 revenue pipeline at ~$35m
- Pro-forma positive operating cash flow of $1.8m in Q4
- Full integration of Digital Box acquisition completed
- Expanded AI partnerships across agritech, healthcare, and industrial safety
A Transformational Quarter for Vection
Vection Technologies Ltd (ASX, VR1) has delivered a landmark quarter, closing FY25 with record-breaking order intake and a robust revenue pipeline. June 2025 saw the company secure over $10 million in new orders, the highest monthly intake in its history, fuelled by significant defence contracts and enterprise wins in artificial intelligence and extended reality (AI/XR) solutions.
Despite a statutory operating cash flow deficit of $2.6 million in Q4, this was primarily due to a delayed $4.4 million payment from a government defence client. Adjusting for this timing issue, Vection’s pro-forma operating cash flow was a positive $1.8 million, marking the third consecutive quarter of operational profitability and underscoring the company’s improving financial health.
Strong Financial and Operational Momentum
The company’s FY25 revenue pipeline has expanded to approximately $35 million, the largest in its history, reflecting growing demand across multiple sectors including defence, finance, telecommunications, media, energy, and public administration. The integration of the Digital Box acquisition was completed during the quarter, enhancing Vection’s AI-XR platform capabilities and recurring revenue streams.
Operational highlights include a $4.4 million follow-on defence order from a top-10 global contractor, pushing cumulative revenue from this client to around $10 million with a further $21 million budgeted through FY29. Vection also expanded its AI portfolio with new partnerships in agritech, healthcare simulation, and industrial safety, including a $2.6 million agreement to deploy the SAFE-XR industrial safety platform and a $1.7 million collaboration with Laerdal Italia for medical training simulations.
Capital and Debt Position
Vection raised $3.55 million through an equity placement to support ongoing AI-XR research and market expansion. The company ended the quarter with $3.3 million in cash and cash equivalents, and a pro-forma adjusted cash position of $7.7 million when factoring in receivables. Long-term debt stands at approximately $18.8 million, primarily from acquisitions, with a clear commitment to debt reduction outlined by management.
Looking Ahead, Scaling and AI Integration
Managing Director Gianmarco Biagi highlighted the company’s strategic priorities for FY26, globalising vertical templates, scaling enterprise pilots, and embedding AI across all modules of the INTEGRATEDXR platform. With a strong pipeline and fresh capital, Vection aims to convert pilots into multiyear subscriptions and pursue inorganic growth opportunities, positioning itself for sustainable profitability and leadership in spatial computing and AI markets.
Vection’s expanding recurring revenue base, now boosted by $1.9 million annual recurring revenue from QuestIT subscriptions, alongside strategic alliances with Dell, DigiLens, and Totalplay, sets the stage for larger cross-border deals and deeper market penetration.
Bottom Line?
With record orders and a clear path to profitability, Vection Technologies is poised to redefine AI and XR integration in FY26.
Questions in the middle?
- Will the delayed $4.4 million defence payment be received on schedule this quarter?
- How quickly can Vection convert its $35 million pipeline into recurring revenue?
- What impact will the planned debt reduction have on the company’s financial flexibility?
