Cogstate Limited

FY26 revenue was just shy of $61 million, up 15% year on year. Profit before tax increased 16%, and EBIT margin was 25% for the full year; EBITDA margin was 30%. Gross margin was 58% for FY26, down from 61% in FY25, but second-half gross margin improved to 62% versus 53% in the first half. New sales contracts were $89 million, up 116%, and contracted future revenue at 30 June 2026 was $118.5 million, with $48.3 million expected to be recognized in FY27, including $46.1 million of clinical trials revenue. Management did not give formal numeric FY27 revenue guidance, but said revenue growth depends on conversion of FY27 contract wins; it expects a second-half bias and said EBITDA margins should be maintained.

Bradley O'Connor framed FY26 as a landmark year that validated Cogstate's diversification strategy and expansion beyond Alzheimer’s disease. He emphasized momentum in mood, sleep, other neurological conditions, rare disease, and channel partnerships, especially Medidata, and said the business now has a materially stronger starting point for FY27. He was upbeat but careful, noting that revenue growth will depend on the timing and conversion of new contracts, even as he described the outlook as very strong.

Darren Watson highlighted revenue growth of 15% to just shy of $61 million, gross margin of 58%, EBITDA margin of 30%, EBIT margin of 25%, and operating expenses falling to 28% of revenue from 31% in FY25. He tied the margin profile to intentional investment in capabilities and noted second-half gross profit margin improved to 62% as revenue scaled. He also said AI-enabled radar training and central monitoring are now fully developed, and that the next 2-year AI operations platform is expected to be mostly capital in nature, with some operating expense, while supporting lower FTE growth and medium-term gross margin expansion. On capital returns, he said the company declared a second annual dividend of $0.04 per share, up from $0.02, representing a 40% payout ratio within the 20% to 50% target, and that the buyback remains open opportunistically.

Analysts focused on the technology investment case, Alzheimer’s visibility, the stability of channel-partner win rates, and how much FX helped margins. Management said the AI/workflow investment is based on a detailed process map and will roll out over 2 years with regular releases that should improve efficiency and quality; Brad also said the FX benefit from forward hedging should not be assumed to repeat, meaning maintaining margins likely requires underlying improvement. On Alzheimer’s, management said new trial starts have been softer recently but they remain bullish, with visibility to late-stage activity and an expectation of more investment as presymptomatic data read out. They also said Medidata and other partners are seeing improved win rates, with channel partners accounting for about 40% of FY26 new sales contracts.