Dubber Corporation Limited

Q2 FY26 reported revenue was $9.3 million, down 1% quarter on quarter. Recurring revenue was $7.8 million versus $8.2 million in Q1 FY26. Gross margin was 70%, up 1 percentage point from Q1. Current operating cash-based cost was $9.5 million, down 12% from Q1, and annualized cash-based costs were $38 million. Operating cash outflow for the quarter was $11.2 million versus $13.1 million in Q1, and overall cash outflow was $2.6 million. Management said it expects to receive about AUD 4.6 million from a Tier 1 North American CSP in Q3, which should make the cash position stronger. The company is targeting underlying cash flow breakeven in FY26 and said gross margins should stay around the 70s, helped by lower data center costs and contract renegotiations.

Matthew Bellizia framed the quarter as a transition from cleanup to growth, saying the company is targeting run-rate breakeven in FY26 while investing heavily in AI R&D. He emphasized that Dubber wants to move beyond being seen as a call-recording vendor and reposition as "Dubber AI," using its global voice-recording asset to deliver practical business outcomes in compliance, sales, and customer support. His tone was optimistic and forward-looking, especially around the new North America CSP win, which he said validates the business and should be leveraged in market.

Prasad Kasinadhuni focused on cost discipline and cash runway. He said Q2 reported revenue was $9.3 million, recurring revenue was $7.8 million, gross margin reached 70%, and Q2 cash-based costs were $9.5 million, down 12% quarter on quarter; annualized cash-based costs were $38 million, down about $5 million versus Q2. He also pointed to $8.6 million of receipts, $11.2 million of operating cash outflow, $2.6 million of overall cash outflow, and an undrawn $5 million loan facility, while noting the expected AUD 4.6 million Q3 CSP payment should strengthen cash further.

Analysts asked about the new contract pipeline, and management said indirect-channel pipeline is hard to fully qualify because Dubber relies on partner inputs rather than a direct sales force. They also asked about remaining VMO2 revenue roll-off, and management confirmed there is still some revenue to roll off but would not quantify it. On cash, management said Q3 should be particularly strong, potentially a record for cash receipts if the North America contract payment arrives as expected, and said no further capital raise is planned.