FY25 at a glance: resilient SaaS growth, AI momentum, and a pivotal OEM deal
Eagle Eye’s FY25 numbers tell a story of a business leaning harder into subscription software and AI, while absorbing a chunky contract loss. Group revenue nudged up 1% to £48.2m, but the mix improved: SaaS grew 11% to £40.2m and recurring revenue rose to 84% of the total. Adjusted EBITDA increased 8% to £12.2m, with margin up to 25.3%.
The standout was EagleAI, up 30% to £5.7m, underscoring demand for data science-led personalisation. The big strategic swing is a five-year OEM agreement to embed Eagle Eye’s AIR platform into a global software vendor’s loyalty solution. The partner is not disclosed, but the pathway is: first contracts targeted for Q2 FY26 and “material” revenue from FY27.
Key numbers investors should know
| Metric | FY25 | FY24 | Change |
|---|---|---|---|
| Group revenue | £48.2m | £47.7m | +1% |
| SaaS revenue | £40.2m | £36.1m | +11% |
| EagleAI revenue | £5.7m | £4.4m | +30% |
| Professional services | £7.5m | £10.2m | (26)% |
| Recurring revenue share | 84% | 79% | +5ppt |
| Period-end ARR | £34.0m | £39.7m | (14)% |
| Net Revenue Retention (NRR) | 109% | 109% | – |
| Adjusted EBITDA | £12.2m | £11.3m | +8% |
| Adjusted EBITA | £6.6m | £4.6m | +43% |
| Profit before tax | £3.0m | £0.7m | +315% |
| Net cash (year end) | £12.3m | £10.4m | +18% |
| Net cash from operations | £13.5m | £9.5m | +42% |
Quick jargon check: SaaS is subscription software; ARR is the annualised recurring revenue at period end; NRR measures how much existing customers grow or shrink over the year; EBITDA is cash-profit before interest, tax, depreciation and amortisation.
What drove the year beneath the headline 1% revenue growth
- Shift to subscriptions: SaaS now makes up 83% of total revenue, showing the model change is bedding in.
- AI adoption: EagleAI revenue climbed 30% to £5.7m and now represents 19% of total ARR.
- Services reset: Professional services fell 26% to £7.5m as Eagle Eye moves to a System Integrator (SI) delivery model. Short-term headwind, longer-term margin lever.
- Cash discipline: Operating cash flow jumped 42% to £13.5m; year-end net cash rose to £12.3m despite PPS acquisition outflows.
OEM agreement could be a game changer from FY27
Eagle Eye embedded AIR into the cloud loyalty suite of a top-tier software vendor (name not disclosed). Product milestones have been met, the salesforce is being trained, 25+ enterprise targets are identified, and the first contracts are anticipated in Q2 FY26. Management believes this route could double the size of the business in the medium term, with material revenue from FY27. Revenue to Eagle Eye will be transactional, contracted via the OEM.
Why it matters: this creates a scalable, partner-led channel into new sectors such as Travel, Hotels, Luxury and CPG, and should reduce Eagle Eye’s own cost of sale and time-to-value per deployment.
AI leadership: more than a buzzword here
EagleAI blends machine learning and real-time execution across AIR, with a newly evolved “affinity engine” to sharpen offer targeting. The company cites proven ROI delivered for major retailers and continues to add AI-driven features, including its first AI-authored feature this year. For FY26 the focus is more EagleAI products, deeper platform integration, and using AI internally to boost productivity.
ARR setback explained: NRS and elevated churn
The thorn in the year was ARR. Period-end ARR fell to £34.0m, primarily due to the previously announced loss of the Neptune Retail Solutions (NRS) related contract in June. Organic ARR excluding PPS was £32.0m, down 19% year on year, though management notes underlying growth of 5% on a constant currency basis when NRS is excluded.
- Long-term contract churn by value rose to 23.1% (FY24: 1.7%), driven by NRS and two North American customers that went into administration.
- Reassurance: NRR stayed 109%, and 83% of revenue from the current top 10 customers (excluding NRS) is contracted to at least FY27.
My take: the ARR drop is the headline negative, but it is tied to a specific client event rather than widespread product or competitive issues. The OEM channel and stronger US go-to-market need to show up in ARR through FY26 to rebuild confidence.
Margins, cash and capital allocation
Direct profit was £34.5m (71.6% margin). Adjusted EBITDA margin improved to 25.3%, helped by cost control and the pivot away from lower-margin SMS and in-house services. Adjusted EBITA rose 43% to £6.6m as amortisation eased.
The balance sheet looks tidy: £12.3m net cash and an undrawn £10m revolving credit facility. Post year-end, a £1m share buyback began, with £0.9m remaining as at 12 September 2025. No dividend, consistent with a growth-first plan and optionality for M&A.
Commercial momentum: new wins, partners and geographies
- New customers included Galeries Lafayette (France), OTR Group and Transurban (Australia), Metro Limited (Singapore) and a Mexican subsidiary of a global retailer.
- Renewals and deepening with Loblaw, Southeastern Grocers, E.Leclerc and Greggs supported NRR of 109%.
- Post year-end wins landed in Central Thailand, a leading European value retailer, and a UK builders’ merchant.
- Partner muscle grew: Deloitte EMEA and CGI joined existing SIs, with the first SI-referred win signed in H2 FY25. Google Cloud Premier Partner status was achieved, and partner-influenced pipeline hit 31%.
Outlook and guidance: what to expect in FY26 and FY27
Trading in early FY26 has started well. The Board aims to maintain a double-digit adjusted EBITDA margin in FY26 and to exit the year at a 20% EBITDA run rate. With OEM ramping, partner scaling and a reinforced US sales push, management guides to a return to double-digit revenue and EBITDA growth in FY27.
The acquisition of Promotional Payments Solutions (completed 27 June 2025) adds approximately €3m ARR and strengthens coverage of CPG couponing, with cost synergies targeted.
Why this update matters for shareholders
- Mix shift improving quality: 84% recurring revenue and 11% SaaS growth are the right long-term ingredients, even if headline revenue was flat.
- AI traction is real: 30% EagleAI growth and increased contribution to ARR show differentiated capability, not just marketing gloss.
- OEM could re-rate the story: if contracts land in Q2 FY26 and scale through FY27, the revenue opportunity and margin profile both improve.
- Cash-backed execution: £12.3m net cash and strong operating cash flow give room to invest while funding buybacks.
The bear points to keep in view
- ARR reset: Period-end ARR down 14% to £34.0m and churn at 23.1% are not small numbers, even with the NRS explanation.
- Services decline near term: Professional services revenue fell 26% during the SI transition, and some implementation revenue will be recognised later under IFRS 15.
- Execution milestones: OEM first customer contracts in Q2 FY26 and a visible US enterprise win-rate uplift are critical proof points.
What I’m watching next
- Q2 FY26: confirmation of OEM general release and initial contracts.
- ARR trajectory: evidence that ARR stabilises and returns to growth through FY26, with EagleAI continuing to outpace.
- US enterprise progress: at least one significant North American logo, as targeted.
- Margin delivery: progress toward the FY26 exit 20% EBITDA run-rate, helped by SI-led delivery and platform efficiencies.
Bottom line
FY25 was a year of transition rather than top-line fireworks, but the mix improved, AI accelerated, cash generation was strong, and the OEM deal sets up a potentially larger, more scalable Eagle Eye from FY27. If management hits the OEM and US milestones and ARR re-accelerates, this update could mark the low-water line before a new growth phase. Equally, delays on OEM or a sluggish US conversion would keep the brakes on. For now, the strategy is coherent, the balance sheet is healthy, and the upside from AI and OEM is worth watching closely.
