Nuix Limited reported a slight revenue increase to $221.5 million for FY25 but swung to a net loss of $9.2 million, weighed down by rising legal fees and restructuring costs. The company’s AI-driven Nuix Neo platform showed strong contract growth, while cash EBITDA improved significantly.
- Revenue up 0.4% to $221.5 million
- Net loss after tax of $9.2 million versus $5 million profit in FY24
- Cash EBITDA rose 24.5% to $37.25 million
- Annualised Contract Value (ACV) grew 8% driven by Nuix Neo platform
- Ongoing litigation and restructuring costs impacted statutory EBITDA
Financial Performance Overview
Nuix Limited’s FY25 results reveal a company in transition. Statutory revenue edged up by a modest 0.4% to $221.5 million, reflecting steady demand amid a complex operating environment. However, the company reported a net loss after tax of $9.2 million, a sharp reversal from the $5 million profit recorded in FY24. This loss was largely driven by increased legal fees related to ongoing litigation and regulatory matters, which rose to $10.6 million, alongside restructuring costs of $1.7 million and a shift in research and development (R&D) capitalisation policies.
Despite the statutory loss, Nuix’s cash EBITDA; a key measure of underlying operational performance; improved significantly by 24.5% to $37.25 million. This improvement was attributed to disciplined cost management and lower variable pay expenses, expanding the cash EBITDA margin to 16.8% from 13.6% the prior year.
Growth in Contractual Value and AI Platform
The company’s Annualised Contract Value (ACV), a critical indicator of recurring revenue strength, grew 8% to $228.4 million. This growth was largely driven by the AI-enriched Nuix Neo platform, which more than doubled its contribution to ACV, reaching $28.1 million. Nuix Neo’s browser-based, scalable platform is central to Nuix’s strategy to deliver modular, AI-enabled solutions across data privacy, investigations, and legal use cases.
Geographically, all regions contributed to ACV growth, with North America leading at $123.2 million, followed by EMEA and Asia Pacific. Subscription ACV, representing recurring revenue streams, increased by 10.1% and now accounts for 97% of total ACV, underscoring Nuix’s shift towards a subscription-based, consumption-driven revenue model.
Technology Restructure and Strategic Focus
During FY25, Nuix undertook a technology restructure to align product and engineering teams more closely with solution-based offerings. The company consolidated core technology hubs in Sydney, Washington DC, Pittsburgh, London, and Hyderabad, aiming to enhance operational efficiency and accelerate product development. This restructure supports Nuix’s focus on evolving its platform with AI capabilities, including significant product releases such as Nuix Neo v1.5 and enhancements to Nuix Discover SaaS.
Risks and Litigation Impact
Nuix continues to face significant legal and regulatory challenges. The company is defending civil proceedings initiated by ASIC alleging market disclosure breaches, alongside a consolidated class action. Legal fees related to these matters have increased, impacting profitability. While Nuix denies the allegations and is cooperating fully, the outcomes and financial impacts remain uncertain. The company maintains a $30 million revolving credit facility with HSBC, with $1.3 million utilised as a bank guarantee, and ended FY25 with nearly $40 million in cash.
Executive Remuneration and Governance
Executive remuneration reflected the company’s mixed performance. Short-term incentives (STI) were awarded at 40.5% of target, acknowledging strong operational and strategic progress despite ACV underperformance. Long-term incentives remain tied to key financial and share-price performance hurdles, aligning management’s interests with shareholders. The Board continues to evolve remuneration frameworks to balance growth incentives with sustainable value creation.
Bottom Line?
Nuix’s FY25 results underscore a pivotal phase balancing innovation-led growth with the financial and reputational costs of ongoing litigation and transformation.
Questions in the middle?
- How will ongoing ASIC proceedings and class actions impact Nuix’s future financial performance and reputation?
- Can Nuix sustain and accelerate growth in its AI-driven Nuix Neo platform to offset legacy revenue declines?
- What are the implications of the technology restructure on product delivery timelines and operational efficiency?