• Strong sales contracts expected, up 82%-97% in 1H26
• Timing delays to impact 1H26 revenue recognition
• Margins expected to be lower in 1H26, improve in 2H26

Cogstate Ltd (ASX:CGS) today announces an update to its financial guidance for the half-year ending 31 December 2025 (1H26), reflecting expected strong performance in sales contracts alongside timing-related revenue deferrals that are expected to have a short-term impact on reported revenue and profitability in 1H26. Clinical Trial sales contracts are progressing well and Cogstate expects to execute sales contracts of approximately $37-$40 million during the 1H26 period, representing 82%-97% growth on the previous corresponding period and the Company's second-best half-year result for contracts executed. However, timing delays are expected to impact revenue recognition in the 1H26 period, primarily due to contracts signed late in the December quarter, which provide limited time for revenue to be recognised within the period. Additionally, the mix of revenue is a contributing factor - upfront license fees will represent a smaller share of revenue, with license revenue expected to be approximately 19%-20% of total revenue in 1H26. Total revenue for 1H26 is now forecast to be in the range of $25-$26 million, an increase of approximately 5%-9% compared to the previous corresponding half-year period. Consistent with previously communicated investment in future growth drivers, Cogstate expects higher direct and operating costs, resulting in lower margins for 1H26. Management expects margins to improve in 2H26 as revenue from the increased level of sales contracts is recognised and the benefits of recent investments begin to scale.

Total revenue for 1H26 is forecast to be in the range of $25-$26 million, up 5%-9% compared to the previous corresponding period. Gross margin of 50%-52%, EBITDA margin of 20%-23%, and EBIT margin of 14%-17.5% are expected for 1H26.

Cogstate remains confident in its growth strategy and competitive position, with a record level of pipeline opportunities and ongoing conversion into contracted work. The company expects margins to improve in 2H26 as revenue from increased sales contracts is recognised and recent investments begin to scale.