Knosys reports steady revenue growth and a strategic partnership to upgrade its GreenOrbit platform, while accelerating development of its AI-powered Libero X library solution for a global launch next year.
- Q2 FY26 cash receipts up 6.6%, half-year receipts up 38%
- Annual Recurring Revenue stable at $9.5 million
- New agency agreement with Oak Engage for GreenOrbit customer migration
- Operational restructure delivers $1 million annual cost savings
- Libero X development on track for FY27 commercial launch
Steady Revenue Growth Amid Seasonal Challenges
Knosys Limited (ASX – KNO) has reported a solid second quarter for FY26, with cash receipts rising 6.6% year-on-year to $1.7 million, despite the seasonally low inflows typical of the December quarter. The first half of FY26 saw a more robust 38% increase in cash receipts to $5.2 million, underpinning a stable Annual Recurring Revenue (ARR) of $9.5 million. This stability reflects strong client retention and recurring revenue streams from a blue-chip customer base.
Strategic Partnership to Enhance GreenOrbit Offering
In a notable development, Knosys entered into a two-year agency agreement with Oak Engage to introduce Oak’s intranet and employee experience platform to its GreenOrbit customers. This move allows Knosys to offer a technology upgrade without incurring development costs, as Oak will eventually take over direct customer relationships. While migration uptake remains uncertain, the arrangement includes remuneration for Knosys based on customer transitions, potentially creating a new revenue stream.
Cost Restructuring Sets Stage for Efficiency
The company undertook an operational restructure during the quarter, resulting in a structurally lower fixed cost base. This includes reductions in staff, research and development, and administrative expenses, expected to save around $1 million annually. Despite a net operating cash outflow of $1.45 million in Q2; largely due to seasonal factors and restructuring costs; Knosys ended the quarter with a cash balance of $1.9 million, which increased to $3.1 million by late January 2026.
Libero X – The Next Frontier in Library Management
Knosys continues to invest heavily in product development, enhancing its current Libero 6 solution with features like Discovery, Events, and Resource Booking to strengthen market positioning in Australia and Germany. More significantly, the company is progressing its next-generation Libero X platform, which integrates advanced AI capabilities for automation and personalisation. Targeted primarily at public libraries, Libero X aims for a commercial launch in FY27, with planned expansion into North American and Germanic markets.
Looking Ahead
Managing Director John Thompson emphasised the company’s confidence in its core businesses and the ambitious product roadmap. Preparations for global sales and marketing campaigns are underway to support Libero X’s launch next year. While the company remains cautious about the timing and scale of customer migration to Oak Engage’s platform, the strategic moves position Knosys well for growth and market expansion.
Bottom Line?
Knosys is streamlining costs and innovating aggressively, setting the stage for a pivotal FY27 as it targets global markets with AI-powered solutions.
Questions in the middle?
- How quickly will GreenOrbit customers migrate to the Oak Engage platform?
- What are the key milestones and risks for the Libero X commercial launch?
- Will the cost savings from restructuring sustain growth without impacting innovation?