FortifAI Limited reported a 51% revenue decline but a 70% reduction in net loss for H1 FY26, alongside completing a major AI technology acquisition and securing $5 million in fresh capital.
- Revenue down 51% to $1.23 million
- Net loss reduced 70% to $517,000
- Completed 5:1 share consolidation and ASX code change to FTI
- Acquisition of FastAI Pty Ltd and Nol8 AI data-in-motion technology
- Announced $5 million strategic placement post-period
Financial Performance and Operational Efficiency
FortifAI Limited (ASX: FTI) has reported a significant improvement in its half-year financial results for the period ended 31 December 2025. Despite a sharp 51% drop in revenue to $1.23 million, the company managed to reduce its net loss by 70%, down to $517,000 from $1.7 million in the previous corresponding period. This turnaround was driven largely by a 73% reduction in employee benefits expense, reflecting a strategic rightsizing and operational efficiency drive.
The company’s cash position remains solid at $2.89 million, supported by government grants and tax incentives expected to be received shortly. However, the auditor’s report flagged material uncertainty around the going concern assumption, underscoring the importance of FortifAI’s ongoing cost control and capital raising efforts.
Strategic Corporate Actions
During the period, FortifAI undertook a 5-for-1 share consolidation, reducing the number of shares on issue and adjusting the ASX code to FTI. This move was aimed at streamlining the capital structure ahead of future growth initiatives.
Post-period, the company completed a transformative acquisition of FastAI Pty Ltd, gaining control of the Nol8 "data-in-motion" AI technology through its Israeli subsidiary Celerriem Ltd. This ultra-low latency data processing engine is designed to classify data in real time, positioning FortifAI to expand beyond gaming into broader AI applications.
Operational Highlights and Growth Prospects
The Mighty Kingdom Games Studio, FortifAI’s gaming division, continued to deliver projects for key partners including Google, Spin Master, and East Side Games Group. Notable achievements include new content for the Fitbit Ace LTE platform and enhancements to popular titles such as Gabby’s Dollhouse and Power Rangers: Mighty Force.
Looking ahead, FortifAI plans to integrate the Nol8 technology with its existing gaming operations, leveraging complementary teams in Australia and Israel. The company is focused on accelerating the technical development roadmap for Nol8, pursuing design partnerships, and moving toward commercial deployments that generate revenue.
Capital Raising and Future Outlook
To support these ambitions, FortifAI announced a $5 million strategic placement at $0.30 per share, scheduled to complete in late February 2026. This capital injection is expected to underpin ongoing development and commercialisation activities while maintaining disciplined cost management.
The board remains cautiously optimistic, highlighting a firm foundation built on improved financial discipline, a strengthened management structure, and a clear path toward a sustainable business model. However, the company acknowledges the risks inherent in executing its growth strategy and the need for continued capital support.
Bottom Line?
FortifAI’s turnaround hinges on successful integration of AI technology and capital deployment amid ongoing market challenges.
Questions in the middle?
- How will FortifAI monetise the Nol8 AI technology beyond gaming?
- What are the risks and timelines associated with commercialising the Nol8 platform?
- How might the recent $5 million placement impact shareholder dilution and future funding needs?