Cogstate Limited

FY26 revenue was just shy of $61 million, up 15% year on year. Profit before tax rose 16%, and EBIT margin was 25%; second-half revenue was up 27% versus the first half, with second-half gross margin at 62% and second-half EBIT margin at 30%. Gross margin for the full year was 58%, down from 61% in the prior year, while EBITDA margin was 30%. New contract sales were $89 million, up 116%, and contracted future revenue at 30 June 2026 was $118.5 million, with $48.3 million expected in FY27, including $46.1 million of clinical trials revenue. For capital returns, Cogstate declared a second annual dividend of $0.04 per share, up from $0.02, representing a 40% payout ratio, and said it ended the year with almost $35 million cash and no debt. Looking ahead, management did not give formal revenue guidance, but said FY27 starts from a much stronger contracted base and expects EBITDA margin to be maintained around FY26’s 30% level, though actual operating margin will depend on contract timing and the FX benefit will not necessarily repeat.

Brad O’Connor characterized FY26 as a landmark year and said the company is seeing real momentum from a strategy of diversification, expanded offerings, and technology investment. He emphasized record contracted revenue, a stronger starting position for FY27, and the opportunity to use AI and automation to improve delivery quality and margins as the business scales. His tone was confident but measured, repeatedly noting that future growth depends on conversion timing and contract mix.

Darren Watson said revenue grew 15% to just shy of $61 million, driven by expansion into new indications, channel-partner sales, and growth in central rating and scale management. He highlighted margin leverage in the second half, when gross margin improved from 53% in the first half to 62%, and said operating expenses fell to 28% of revenue from 31% in FY25. He also pointed to cash discipline, the $0.04 per share dividend at a 40% payout ratio, continued share buyback flexibility, and the planned multi-year investment in AI-enabled workflow automation, much of which he expects to be capital in nature.

Analysts pressed on the business case for technology spending, and management said it had mapped current and end-state processes and will use AI operations tools, portals, and workflow automation to replace manual steps and improve quality and efficiency over a 2-year rollout. On Alzheimer’s, management said new trial starts have been lower, but they remain bullish and see late-stage pipeline visibility, especially from large pharma and new biotech mechanisms. They also said channel-partner win rates, especially through Medidata, have improved and are continuing to trend higher, while acknowledging that sales contract flow can still be lumpy quarter to quarter.