Cogstate Posts 22% Revenue Growth and Nearly Doubles Profit in FY25
Cogstate Limited has reported a landmark FY25 with revenue up 22% and net profit before tax nearly doubling, driven by a surge in clinical trials contracts and strategic innovation. The company also declared its maiden fully franked dividend and outlined ambitious growth plans including AI product launches and an expanding Medidata partnership.
- FY25 revenue rises 22% to $53.1 million
- Net profit before tax nearly doubles to $13.9 million
- Clinical Trials new contract sales jump 53% to $41.3 million
- Maiden fully franked dividend of A$0.02 per share declared
- FY26 growth driven by AI product launch and Medidata partnership expansion
Record Financial Performance
Cogstate Limited (ASX, CGS) has delivered a standout FY25, posting a 22% increase in group revenue to US$53.1 million and nearly doubling its net profit before tax to US$13.9 million. The company’s EBITDA surged 72% to US$16.0 million, with margins expanding to 30.1%, underscoring the scalable nature of its business model and operational efficiency.
The driving force behind this growth was the Clinical Trials division, which saw new contract sales soar 53% to US$41.3 million. This robust demand reflects Cogstate’s expanding footprint across diverse therapeutic areas including rare diseases, sleep disorders, psychiatric conditions, and neurodegenerative diseases.
Strategic Growth and Innovation
Cogstate’s strategic partnership with Medidata has gained momentum, positioning the company for significant revenue contributions in FY26. This alliance enhances Cogstate’s reach in central nervous system (CNS) clinical research globally, a key growth sector.
Innovation remains a core focus, with Cogstate preparing to launch its first AI-powered products in FY26. These solutions aim to improve data quality and signal detection in CNS trials, reinforcing the company’s leadership in digital cognitive assessments.
Capital Management and Shareholder Returns
Reflecting confidence in its long-term prospects, Cogstate declared its maiden fully franked dividend of A$0.02 per share and completed a $4.8 million share buy-back during the year. The company ended FY25 with a strong cash balance of US$35.6 million, supporting ongoing investment in growth and innovation.
Management outlined a balanced capital allocation strategy prioritising strategic growth initiatives, innovation investment, shareholder returns, and sustainable dividends targeting 20-50% of net profit after tax.
Outlook and Market Positioning
Entering FY26, Cogstate has secured US$14.1 million in new sales contracts, raising contracted revenue expected to be recognised in FY26 to US$35.9 million. While no specific revenue guidance was provided, management anticipates continued growth supported by expanding clinical trial demand and new AI offerings.
However, increased investments in science, engineering, and regional resources may exert slight margin pressure. The company remains well-positioned to capitalise on rising global CNS research and development investment, particularly in psychiatric and mood disorders, beyond its traditional Alzheimer’s Disease focus.
CEO Brad O’Connor highlighted FY25 as transformative, with record results and strengthened foundations for sustainable growth through innovation and partnerships.
Bottom Line?
Cogstate’s FY25 momentum and strategic investments set the stage for a dynamic FY26, but investors will watch closely for execution on AI launches and margin impacts.
Questions in the middle?
- How will Cogstate’s AI-powered products perform commercially in FY26 and beyond?
- What revenue impact will the Medidata partnership deliver as it scales?
- Can margin expansion be sustained amid increased investment in growth initiatives?
