Connexion Mobility Records $3M Quarter with GM Canada Expansion

GM Canada Deal Drives Record Revenue

Connexion Mobility Ltd (ASX:CXZ) has reached a new quarterly revenue milestone of $3 million, a 5% increase over the previous quarter, fuelled largely by its appointment as the exclusive software provider for General Motors Canada’s Enhanced Exposure Program (EEP). This national rollout, powered by Connexion’s OnTRAC platform, marks the company’s significant expansion into the Canadian automotive retail market.

The EEP contract is a strong endorsement from both GM Canada and GM US, reflecting confidence in Connexion’s ability to meet OEM needs across North America. The company executed a rapid, multi-lingual national launch with minimal operational disruption, underscoring its operational agility. This expansion complements Connexion’s established US footprint, where it supplies mobility SaaS platforms to automotive OEMs and franchised dealers for courtesy transportation management.

Profitability Impacted by Increased Expenses

Despite the revenue surge, Connexion’s net profit before tax (NPBT) dropped 31% quarter-on-quarter to $0.6 million, largely due to a $0.4 million rise in total expenses. Non-recurring administrative costs accounted for half of this increase, alongside seasonal expenses and ongoing cost of sales. As a result, diluted earnings per share fell 29% to 0.052 US cents, even as the company continued to reduce its share count through buybacks.

The gross profit margin improved, rising 11% to $1.9 million, reflecting higher revenue from the GM Canada launch while cost of sales remained steady. Connexion’s revenue streams showed mixed trends: subscription revenue increased 6%, service revenue grew 8%, and fixed-dollar SaaS revenue held steady. The company’s diversified revenue model, comprising subscription-based SaaS, fixed-dollar SaaS, and service revenue, helps moderate volatility from fluctuating subscription bases.

Strategic Investments and Capital Management

Connexion continues to prioritise long-term shareholder value by focusing on sustainable earnings growth and diversification. It maintains a strong balance sheet with $5.9 million in net cash and investments and zero debt, supporting ongoing R&D and operational investments. The company repurchased 98 million shares during the quarter at an average price of A$0.0253, bringing total buybacks to approximately 357 million shares at an average of A$0.022.

Research and development efforts remain robust, targeting product enhancements such as AI-enabled support, multi-lingual capabilities, and integrations with partners like Stripe and Modives. These initiatives aim to deepen customer relationships and expand Connexion’s footprint beyond loaner vehicles into other modes of courtesy transportation like shuttles and ridehail services.

With internal reinvestment fully funded, Connexion is actively exploring alternative uses for capital, including potential mergers and acquisitions. The company signalled it expects to provide updates on these opportunities in the coming quarter.

Sales Traction Moderates Amid Resource Constraints

Dealership subscription growth slowed this quarter, with 12 net new subscriptions or trials compared to 25 in the previous period. This moderation was influenced by personnel changes, maternity leave, and resource allocation to the GM Canada launch. Nonetheless, Connexion’s marketplace subscriptions continue to grow steadily, albeit at a more modest pace following earlier rapid expansion.

This operational backdrop aligns with the company’s earlier performance where it reported a 7% revenue increase and profit growth for the half-year ended December 2025, alongside a strategic stake acquisition in Covertrue Group Pty Connexion Mobility Boosts Revenue and Profit. The ongoing integration of commercial partnerships such as Tollaid, OnDemand, UVeye, and Stripe further supports Connexion’s strategy to broaden its software ecosystem and revenue sources.