dotdigital Group (DOTD) H2 2025 earnings summary

Executive summary

• Achieved strong financial results for FY2025, with profitability and EPS marginally ahead of expectations, driven by organic expansion and international markets despite macroeconomic challenges.

• Continued investment in technology, especially AI, and integration of acquisitions like Social Snowball, expanding product capabilities and addressable market.

• Diversified revenue streams with 94% of group revenues from recurring and repeating sources, providing predictability and stability.

• Organisational enhancements included scaling efforts, international investments, and recruitment of a Chief Revenue Officer.

Financial highlights

• Group revenue grew 7% year-over-year on a constant currency basis to £83.9m, with recurring revenue up 8%.

• Adjusted EBITDA margin at 32%, with free cash flow of £13.9m for FY2025.

• Gross margin at 80% group-wide, with core contracted recurring revenues carrying over 90% gross margin.

• International revenues now 33% of group total, growing at 20% year-over-year.

• Average revenue per customer increased 8% year-over-year on a normalized basis to £1,923 per month.

Outlook and guidance

• Confident in continued growth and meeting market expectations for FY2026, supported by strong recurring revenues and cash position.

• Ongoing investment in organic growth, product innovation (notably AI and loyalty platform), and selective M&A.

• International expansion and new product launches expected to drive further ARPC and market share gains.