Integrated Research Limited

Statutory revenue for first half FY26 was $28.3 million, down 2% versus the prior comparable period. Pro forma revenue was $34.4 million, down 6%, with term-based contracts revenue down 4% and services revenue down 2%. EBITDA was a loss of $3.1 million and net after-tax loss was $1.5 million, versus PCP profit of $4.6 million for both measures. Expected credit losses were $4.8 million, and excluding that, operating expenses were down 4% to $26.5 million. Cash increased to $43.6 million, net assets were $95.7 million, and the company has no debt. Management said results were at the upper end of the guidance range provided on 14 November 2025. Looking ahead, they said expenses are expected to increase in 2H FY26 due to accelerated investment in the product-led growth strategy, but no quantitative full-year or next-half revenue/EPS guidance was given.

Ian Lowe framed the half as a transition period: short-term pressure from a softer renewals book and underinvestment in new products, offset by early signs that the product-led growth strategy is taking shape. He said the company is focused on building and commercializing new products, with Iris, Elevate, High Value Payments, and the upcoming IR Labs launch central to the roadmap. His tone was constructive but realistic, repeatedly saying the shift to sustainable growth will take time.

Christian Shaw focused on the financial bridge from PCP, noting the $28.3 million statutory revenue figure, the $3.1 million EBITDA loss, and the $1.5 million net loss after tax, with the main swing factor being a $4.8 million expected credit loss. He said operating expenses excluding credit losses fell 4% to $26.5 million, product and technology spend rose 14%, Sales & Marketing fell 9%, and G&A was flat excluding the credit loss. He also highlighted stronger cash generation, with operating cash flow up to $5.5 million from $0.5 million, closing cash at $43.6 million, net assets at $95.7 million, and no debt.

Analysts pressed on the large credit loss, and management said the issue came from an unusual single-client reseller contract, that incremental guardrails have been put in place, and that the risk is contained to that client. On AI disruption, Ian argued IR’s edge is not just collecting telemetry but normalizing, analyzing, and operationalizing observability data through workflow automation and remediation, where he sees an opportunity for AI rather than a threat. Questions on M&A and capital allocation led Ian to say IR is open only to rightsized deals that accelerate product-led growth, and that a share buyback is not the priority right now because preserving capital for the growth strategy is more important.