Eagle Eye Solutions beats FY26 expectations as ARR jumps 31%

Eagle Eye finishes its recovery year ahead of expectations

Eagle Eye Solutions Group has closed FY26 ahead of recently upgraded market expectations, helped by strong recurring revenue growth, customer wins and a sharp improvement in second-half profitability.

The headline numbers require a little unpacking. Reported Group revenue fell 3% to £46.7 million and adjusted EBITDA declined 19% to £9.8 million, largely reflecting the loss of the Neptune Retail Solutions, or NRS, contract in June 2025.

Excluding NRS, the underlying picture was much stronger. Revenue grew 21% to £46.1 million, while annual recurring revenue, or ARR, increased 31% to £44.5 million.

That suggests the company has replaced the lost contract with a broader mix of new and expanded customer relationships, although investors should remember that the FY26 figures are management estimates and remain unaudited.

The key FY26 figures

Metric	FY26	FY25	Change
ARR excluding NRS	£44.5 million	£34.0 million	31%
Revenue excluding NRS	£46.1 million	£38.1 million	21%
SaaS revenue excluding NRS	£39.3 million	£31.3 million	26%
Reported Group revenue	£46.7 million	£48.2 million	-3%
Recurring revenue	£40.7 million	£40.7 million	No change
Adjusted EBITDA	£9.8 million	£12.2 million	-19%
Adjusted EBITDA margin	21%	25%	-4 percentage points
Net cash	£16.1 million	£12.3 million	31%

The result exceeded the company's stated market consensus of £45.4 million for revenue and £7.0 million for adjusted EBITDA. That puts revenue £1.3 million ahead and adjusted EBITDA £2.8 million ahead of those expectations.

Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation, with further adjustments including share-based payments, restructuring costs and costs linked to the 2025 acquisition of Promotional Payments Solutions.

Recurring revenue growth is the main attraction

ARR rose 31% to £44.5 million, driven by major customer wins, expansion within existing accounts and the first customer contracts secured through Eagle Eye's global original equipment manufacturer, or OEM, partnership.

An OEM agreement allows another software provider to incorporate Eagle Eye's technology within its own offering. This potentially gives Eagle Eye access to customers, sectors and regions without relying entirely on its direct sales operation.

The first two OEM contracts are estimated to contribute approximately £2 million of ARR from their initial deployments and are expected to begin generating revenue in FY27.

There is an important qualification. Eagle Eye's ARR definition includes secured new wins and certain long-term professional services. For the OEM contracts, ARR is an estimate based on anticipated consumer numbers and volumes. Investors will therefore want to see this contracted momentum convert into reported revenue and cash over time.

The recurring revenue mix also improved. Subscription fees and transaction revenue represented 87% of Group revenue, up from 84%, even though recurring revenue itself was unchanged at £40.7 million on a reported basis.

A higher proportion of predictable SaaS revenue should support visibility and may help margins as the business scales.

Customer wins broaden the opportunity

Commercial progress continued during the second half. New agreements included:

• A three-year deal with Asda for EagleAI Personalised Challenges.
• A three-year agreement with easyJet, through partner BCG, supporting a new loyalty scheme expected to launch in 2027.
• A three-year Personalised Challenges contract with a leading UK health and beauty retailer.
• A three-year agreement with Subway covering its loyalty programme across four European markets.
• A proof-of-concept trial with a major French grocer.

The easyJet agreement takes Eagle Eye into the airline market, while Subway adds another global consumer brand. The French grocery trial is earlier-stage and does not guarantee a wider commercial rollout, but it could provide another route to expansion if successful.

Existing customers are also doing more with the platform. Eagle Eye signed a five-year renewal with Woolworths Group, a two-year renewal with Auchan and expansions with Carrefour, Asda and Morrisons.

Net revenue retention, or NRR, remained at 111%. This measures revenue retained from existing customers after allowing for expansion and losses. A figure above 100% indicates that growth within retained accounts more than offset reductions.

EagleAI revenue increased 34% to £7.7 million, accelerating during the second half. The company cited new customers including Morrisons, Wakefern and Asda, alongside higher volumes from existing customers such as Carrefour.

Profitability recovered strongly in the second half

Following the loss of NRS, management targeted an exit adjusted EBITDA margin run rate of 20%. It says this was materially exceeded during the second half.

For FY26 as a whole, the adjusted EBITDA margin was 21%, down from 25% in FY25. The annual decline shows that the NRS loss still had a meaningful impact, but the stronger second-half exit rate points to improving operational performance.

Management attributed the recovery to a greater proportion of SaaS revenue, cost discipline and efficiency programmes.

Cash generation was another positive. Net cash increased from £12.3 million to £16.1 million, including a £0.5 million net benefit from the share buyback programme and sale of treasury shares.

The balance sheet gives Eagle Eye scope to continue investing in sales, marketing and data engineering. Recruitment programmes remain ongoing, so investors should watch whether additional spending produces enough growth to protect the recent margin improvement.

What could go right and what could go wrong?

The strongest part of this update is the forward-looking revenue base. ARR growth of 31%, NRR of 111%, new multinational customers and the first OEM contracts all support management's confidence in FY27.

The cash position also provides resilience, while the improved recurring revenue mix may support further margin expansion.

However, the recovery is not complete. Reported revenue and adjusted EBITDA both remained below FY25 levels, and the full-year adjusted EBITDA margin fell by four percentage points.

Execution is now the key issue. Eagle Eye needs to convert secured contracts and estimated OEM ARR into reported revenue, sustain customer expansion and invest without giving back its second-half margin gains.

The medium-term goals of more than £100 million in revenue and an adjusted EBITDA margin above 30% are ambitious. No precise delivery date was disclosed in this announcement.

FY27 becomes the proof point

Eagle Eye expects to return to double-digit revenue and adjusted EBITDA growth in FY27. Growing ARR, continued contract wins and an expanded partner network provide a credible foundation for that target, based on the information disclosed.

This was a reassuring update after the disruption caused by the NRS contract loss. Underlying revenue growth was strong, profitability beat expectations and net cash improved.

The next test is whether Eagle Eye can turn its expanding contract base, particularly the OEM channel, into sustained reported growth. Full results for the year ended 30 June 2026 are expected on 15 September 2026.