• Subscription revenue up 5.7% and ARR up 11.2% to €76.4m
• EBITDA margin increased to 19.6% from 11.3% in 1H24
• Expecting positive free cash flow in FY25 and sustained annual profitability from FY26

FINEOS Corporation Holdings Plc reported its 1H25 results, highlighting key financial and operational achievements. Subscription revenue grew by 5.7% to €36.4m, representing 54.3% of total revenue, and Annual Recurring Revenue (ARR) increased by 11.2% to €76.4m. Total revenue increased by 4.2% to €67.1m, driven by growth in both subscription and services revenue. EBITDA increased by 80.1% to €13.1m, with the EBITDA margin expanding to 19.6% from 11.3% in 1H24. The company continued to enhance its market leadership, winning two new North American carriers and achieving several go-lives. It also launched embedded AI capabilities and made progress on the Guardian Phase 2 project. Cost efficiency initiatives delivered savings, including the absorption of approximately €1.0m in restructuring costs. The company expects to achieve positive free cash flow in FY25 in aggregate and sustained annual profitability from FY26 onwards.

Revenue is now guided to be at the lower end of the range provided (€138m - €143m) primarily due to the weakening of trading currencies against the Euro. The company continues to expect positive free cash flow in FY25 in aggregate and to be cash generative thereafter.

FINEOS remains on track to achieve its growth expectations, including increasing subscription fees as a percentage of total revenues to 65% in FY27 and 75% in FY29, decreasing R&D investment as a percentage of total revenue to 30% in FY27 and 25% in FY29, and increasing gross margin to 75% in FY27 and 80% in FY29, as well as EBITDA margin to 25% in FY27 and 40% in FY29.