hipages Group reported a robust FY25 with revenue up 10%, EBITDA rising 20%, and free cash flow surging 162%, underpinned by strategic platform migration and subscription model shifts.
- Revenue increased 10% to $83.1 million
- EBITDA grew 20% to $19.6 million with 24% margin
- Free cash flow surged 162% to $5.6 million
- Successful migration to single tradie platform in Australia
- New Zealand transitioned fully to subscription model
Strong Financial Performance Amid Strategic Transformation
hipages Group (ASX, HPG) has delivered a compelling FY25 financial performance, marked by a 10% increase in total revenue to $83.1 million and a 20% uplift in EBITDA to $19.6 million. The company’s focus on evolving from a marketplace to a SaaS platform for tradies and homeowners across Australia and New Zealand is clearly bearing fruit, with recurring revenue now representing 97% of total revenue and a record EBITDA margin of 24%.
Free cash flow saw an extraordinary jump of 162% to $5.6 million, reflecting strong operating leverage and disciplined cost management. The cash balance also strengthened to $26.9 million, providing a solid foundation for future growth initiatives.
Platform Migration and Subscription Model Drive Growth
A key highlight of FY25 was the successful migration of Australian tradies onto a unified Single Tradie Platform (STP), which combines lead generation and job management features into one app. This migration has supported a 9% increase in annual revenue per user (ARPU) in Australia, reaching $2,381, and helped maintain a stable base of 33,300 subscription tradies.
Meanwhile, hipages’ New Zealand business, Builderscrack, completed its transition to a full subscription model, driving a 23% revenue increase in that market and lifting ARPU to an exit run rate of $1,536. This shift to subscription-based pricing is expected to enhance customer retention and lifetime value.
Operational Efficiency and Technology Investment
Operating expenses as a percentage of revenue have been carefully managed, with marketing spend stable and sales employment costs rising modestly to support New Zealand growth. Technology investment remains a priority but is gradually decreasing as a proportion of revenue, with FY25 focused on developing the Single Tradie Platform and marketplace optimisations.
Looking ahead, hipages plans to continue enhancing its platform with AI-driven features, including an AI assistant for homeowners and improvements to the job matching engine, aiming to deepen tradie engagement and improve customer experience.
Positive Outlook for FY26
For FY26, hipages targets total revenue growth of 10-12%, an EBITDA margin expansion to 24-26%, and free cash flow between $8 million and $10 million. The company’s strategic pillars include expanding value-added services such as the newly launched 'hipages toolbox'; an in-app marketplace offering tradies access to insurance, materials, financing, and business tools.
This outlook assumes stable macroeconomic conditions and continued execution of the company’s strategy to capture a larger share of the tradie market by broadening its product offering and enhancing platform stickiness.
Bottom Line?
hipages’ FY25 results underscore its successful transition to a SaaS model, setting the stage for sustained growth and profitability in FY26 and beyond.
Questions in the middle?
- How quickly will hipages complete migration of remaining Australian tradies to new pricing plans?
- What impact will AI-driven features have on tradie retention and ARPU growth?
- How will hipages’ expanding value-added services affect competitive positioning?