Activeport Group Ltd reported steady Q2 FY26 revenue with new contracts starting to contribute and a 5% increase in annualised recurring revenue to $6.3 million. The company also reduced cash burn significantly and strengthened its cash position to support growth.
- Annualised recurring revenue up 5% to $6.3 million
- High-margin software revenue grows 6% in Q2 FY26
- Cash burn halved from $500K to $270K per month
- Major projects progressing with Reliance Jio, Telekom Malaysia, and Ishan
- Strong cash position of approximately $5 million with no term debt
Steady Revenue and Contract Momentum
Activeport Group Ltd (ASX – ATV) delivered a solid second quarter for fiscal year 2026, maintaining revenue levels consistent with prior quarters while new contract wins began contributing to the top line in December. The company’s annualised recurring revenue rose 5% year-on-year to $6.3 million, reflecting growing customer adoption of its software platforms. This steady performance comes despite the typical seasonal slowdown in services revenue during the holiday period, underscoring the resilience of Activeport’s recurring revenue model.
High-margin software revenue, a key growth driver, increased by 6% compared to the first quarter, setting a strong foundation for further expansion in the coming months. This growth was supported by multiple new project wins and service implementations, particularly in the network-as-a-service segment within Australia.
Operational Advances in GPU Orchestration and Network Automation
Activeport made significant strides in product development and customer deployments during the quarter. The company enhanced its flagship orchestration software with a new high-availability architecture and improved features such as role-based access controls and billing capabilities. These upgrades aim to boost reliability and appeal for large-scale telecommunications and data centre clients.
In the GPU orchestration space, Activeport supported Reliance Jio’s major rollout program with refined zero-touch deployment features and an upgraded file system to manage distributed content libraries efficiently. The shipment of approximately 200 GPUs in Q2, primarily to operators in India and Thailand, is set to accelerate with an additional 500 units planned for Q3. Notably, Activeport’s partner Radian Arc secured True Corporation, Thailand’s largest mobile operator, as a new cloud gaming customer, marking a significant expansion in this high-growth segment.
Financial Strength and Strategic Funding
Activeport’s cash burn rate was nearly halved from $500,000 per month in Q1 to $270,000 per month in Q2, reflecting disciplined cost management. The company ended the quarter with approximately $3.9 million in cash, which increased to nearly $5 million including pending director contributions and a recent customer payment. This strong liquidity position, combined with no term debt, provides a solid runway to execute on new contracts and accelerate business development throughout 2026.
The company also completed a $6.68 million placement to institutional and sophisticated investors and repaid its outstanding R&D loan, further strengthening its balance sheet. These financial moves underpin Activeport’s capacity to invest in product innovation and market expansion.
Looking Ahead – Growth Opportunities and ZEPO Incentives
Activeport is advancing development of a telco network-to-network interconnect platform, expected to launch in the second half of FY26, which promises to add a premium revenue stream. The company’s pipeline remains robust, driven by surging demand for data centre capacity and neo-cloud services fueled by AI growth.
Meanwhile, the company’s zero exercise price options (ZEPOs) remain unvested, tied to share price milestones ranging from $0.10 to $0.20. These performance-based incentives could align management and shareholder interests as Activeport seeks to capitalise on its expanding market opportunities.
Bottom Line?
With new contracts ramping and a fortified balance sheet, Activeport is poised for accelerated growth, but investors will watch closely for Q3 revenue confirmation and ZEPO vesting triggers.
Questions in the middle?
- How quickly will new GPU orchestration contracts translate into recurring revenue growth?
- What impact will the upcoming telco network-to-network interconnect platform have on margins?
- When might the ZEPO vesting conditions be met given current share price trends?