DUG Technology Surpasses FY25 Revenue with 35% Growth in FY26-Q3

Record Revenue Growth Outpaces Prior Full Year

DUG Technology Ltd (ASX:DUG) posted a 35% jump in total revenue to US$22.4 million for the quarter ended March 31, 2026, with the first nine months of FY26 already exceeding the full-year revenue of FY25 by a substantial margin. The company’s total revenue for the nine-month period hit US$62.7 million, a 39% increase year-on-year, signalling strong momentum across its core business lines.

This surge is underpinned by a 16% increase in Services revenue to US$15.3 million for the quarter and a 25% rise to US$47.1 million year-to-date, driven by a growing pipeline of exploration and production projects. The recurring nature of 4D seismic processing projects, which clients typically renew every 18 months, is contributing to this steady revenue stream. DUG’s expansion into new regions is also buoyed by a favourable oil price environment encouraging increased exploration activity.

High-Margin Software and HPC Fuel Earnings and Cash Flow

Software and high-performance computing (HPC) revenues are now accounting for 32% of total revenue, with software revenue up 34% to US$3.8 million and HPC revenue surging 526% to US$3.3 million in the quarter. This shift towards higher-margin, recurring revenue streams is enhancing the overall quality of earnings and driving significant margin expansion. EBITDA climbed 49% to US$7.9 million for the quarter, with normalised EBITDA (excluding a one-off legal settlement expense) up 37% to US$7.3 million.

The company’s operating cash flow also saw a remarkable 399% increase to US$16.2 million in the quarter, reflecting improved profitability and working capital management. The closing net cash position improved to US$11.4 million from a net debt position of US$6.6 million a year earlier, providing a stronger liquidity buffer for ongoing growth initiatives.

Legal Settlement Expense and Reporting Strategy Shift

DUG’s normalised EBITDA excludes a one-off expense related to the settlement of a legal dispute with a US supplier, resolved in March 2026. This settlement, which avoided further litigation costs, was previously detailed in the company’s $1.5M legal settlement announcement. The resolution has cleared a financial overhang, allowing the company to focus on operational growth.

In a strategic pivot, DUG announced it will cease quarterly reporting, opting instead for half-year and full-year financial updates. The company cited the volatility introduced by contract timings and multi-jurisdictional revenue recognition as factors that made quarterly figures less reflective of the business’s underlying momentum. This move aims to provide shareholders with clearer insights into long-term value creation, though it may reduce the frequency of market updates.

International Expansion and Future Pipeline

Managing Director Dr Matthew Lamont highlighted the company’s international growth strategy as a key driver of sustained performance. With offices spanning Perth, London, Houston, Kuala Lumpur, and Abu Dhabi, DUG is capitalising on global demand for its elastic multiparameter full waveform inversion (MP-FWI) imaging technology. The ongoing build in recurring 4D project volume and the rapid growth of software and HPC revenues position DUG well for future opportunities.

This expansion follows earlier milestones such as the record SaaS contract and global expansion signed in FY26-Q1, which laid the groundwork for the current revenue trajectory. The company’s focus on sustainable computing innovations and cloud-based geoscience services continues to resonate with clients navigating complex data challenges worldwide.