Nuix Limited (ASX: NXL) has released its preliminary financial results for the half year ending 31 December 2024 (1H25). While the company demonstrates solid growth in Annualised Contract Value (ACV) and Statutory Revenue, challenges in procurement cycles and restructuring have impacted profitability metrics.
Key Financial Highlights
| Metric | 1H25 Range | 1H24 Reported | Change (YoY) |
|---|---|---|---|
| Annualised Contract Value (ACV) | $215M–$217M | $199.6M | +8% to +9% |
| Statutory Revenue | $104M–$106M | $98.4M | +6% to +8% |
| Cash EBITDA | $11M–$13M | $10.3M | +7% to +26% |
| Underlying EBITDA | $26M–$28M | $28.4M | (1%) to (8%) |
| Statutory EBITDA | $14M–$16M | $17.2M | (7%) to (19%) |
| Cash on Hand | $30M–$31M | $24M | +25% to +29% |
Performance Drivers
- ACV Growth:
- ACV increased by 8%–9% year-on-year, driven by strong customer retention and expanded contract values.
- Nuix Neo has been a standout, growing ACV to $19 million (+360% YoY), with 46 customers compared to just 8 in the prior corresponding period.
- Revenue Performance:
- Statutory Revenue growth of 6%–8% reflects the company’s success in securing multi-year deals.
- Profitability Metrics:
- Statutory EBITDA declined due to a significant reduction in capitalised R&D spend and $2.2 million in restructuring costs.
- Legal expenses remain a burden, though lower at $9.5 million, compared to $11.2 million in 1H24.
- Cash and Liquidity:
- Strong cash flow performance with $30M–$31M in cash and no debt ensures financial stability.
- Nuix remains on track to fund software development entirely through free cash flow.
Operational Updates and Strategic Outlook
- Procurement Cycle Challenges: Increasing contract complexity and a shift from component sales to platform deals have extended sales cycles. Despite this, Nuix maintains a full-year ACV growth target of ~15%, with current guidance in the range of 11%–16% in constant currency.
- Restructuring Initiatives: Efforts to streamline technology and product development have led to short-term costs but are expected to enhance efficiency long-term.
- Positive Cash Flow Trajectory: Nuix remains committed to achieving underlying cash flow positivity for FY25, a key strategic goal.
Looking Ahead
Nuix is building momentum with strong ACV growth and promising adoption of its Nuix Neo platform. While challenges like extended procurement cycles and restructuring costs weigh on short-term profitability, the company’s focus on efficiency and innovation positions it well for sustainable long-term growth.
Investors can anticipate further updates as Nuix executes its FY25 strategy and continues to drive value through its expanding customer base and innovative product offerings.
