Cluey’s Shift to AI-Driven Products: Can It Sustain Profitability Gains?

Financial Turnaround and Operational Efficiency

Cluey Ltd has marked FY25 as a pivotal year, delivering a 50% improvement in EBITDA compared to the prior year, narrowing losses to $4.5 million. This progress was underpinned by disciplined cost management, including a 21% reduction in operating and marketing expenses, and automation initiatives that enhanced operational efficiency. Notably, the company achieved its first quarter of positive operating cash flow in Q4 FY25, signaling a tangible step towards financial sustainability.

Underlying EBITDA, which excludes one-off costs such as capital raises and restructuring, improved by 35%, reflecting a more normalized view of the company’s profitability trajectory. Despite a slight revenue decline, Cluey’s strategic focus on cost control and efficiency has allowed it to offset these pressures effectively.

Return to Growth in Student Numbers

After a period of top-line challenges, Cluey successfully reversed the trend by increasing new student enrolments by 11% to 34,737 in FY25. This growth was achieved alongside a 33% improvement in variable customer acquisition cost (CAC), which dropped to $180 per new student. The improved CAC efficiency enables Cluey to sustainably scale its customer base while maintaining disciplined marketing spend.

These metrics suggest that Cluey’s recalibrated approach; shifting from aggressive growth to profitability and efficiency; is resonating with the market and customers alike. The company’s ability to attract more students at a lower acquisition cost bodes well for future revenue growth.

Strategic Pivot to AI-Enabled Product Innovation

Looking ahead to FY26, Cluey is doubling down on product-led growth, with a clear emphasis on integrating artificial intelligence into its learning offerings. The company is expanding its product suite to include AI-powered tools such as an AI Exam Coach for Year 12 students, AI-supported practice environments, and on-demand video lessons aligned with school curricula.

This AI-first strategy aims to deepen student engagement, enhance learning outcomes, and differentiate Cluey in the competitive EdTech landscape. By combining human tutoring with scalable AI solutions, Cluey is positioning itself as a hybrid learning provider that can serve diverse student needs across online and offline channels.

Broader Market Opportunity and Integrated Learning Services

Cluey’s vision extends beyond tutoring to become a comprehensive learning services company. Its roadmap includes a broad portfolio spanning core curriculum support, skill-based learning, test preparation, and life skills development. The company plans to leverage AI to provide personalised mastery pathways, always-on micro-learning support, and automated marking services.

This integrated approach reflects the evolving nature of K–12 education, where hybrid models combining technology and human interaction are becoming the norm. Cluey’s investments in AI and product diversification could enable it to capture a larger share of the growing learning support market.