Pulsar Group revenue hits record £33.0 million as margins improve

Pulsar Group's interim results at a glance

Pulsar Group has reported a stronger first half, combining record revenue with improved profitability and cash generation.

For the six months ended 31 May 2026, revenue rose 10% to £33.0 million, while adjusted EBITDA increased 39% to £5.1 million. Adjusted EBITDA means earnings before interest, tax, depreciation and amortisation, with further adjustments made for items such as restructuring costs and share-based payments.

The margin on that measure improved from 12% to 15%, showing that revenue growth is beginning to translate into better operating profitability following last year's cost reductions.

Key figure	H1 2026	H1 2025	Change
Revenue	£33.0 million	£30.1 million	10%
Recurring revenue	97%	95%	2 percentage points
Adjusted EBITDA	£5.1 million	£3.6 million	39%
Adjusted EBITDA margin	15%	12%	3 percentage points
Operating loss	£2.5 million	£4.4 million	Improved
Loss for the period	£2.4 million	£4.3 million	Improved
Net cash from operations	£3.3 million	£1.8 million	Improved

The Board said trading remains in line with its expectations.

ARR growth needs some context

Annual recurring revenue, or ARR, increased to £67.2 million from £64.5 million at 30 November 2025. ARR represents the annualised value of recurring customer contracts and is Pulsar's primary performance indicator.

On a reported basis, the £2.7 million increase looks encouraging. However, £1.5 million of this came from favourable foreign exchange movements. At constant currency, which strips out exchange-rate effects, ARR grew by £1.2 million.

That distinction matters. The underlying business expanded, but not by as much as the headline reported figure suggests.

Performance also differed by region:

ARR by region	November 2025	May 2026	Constant-currency movement	Reported movement
EMEA and North America	£34.2 million reported	£35.5 million	£1.4 million	£1.3 million
APAC	£30.3 million reported	£31.7 million	£(0.2) million	£1.4 million
Group	£64.5 million reported	£67.2 million	£1.2 million	£2.7 million

EMEA and North America was the main source of underlying growth, supported by enterprise customers. New clients included Aldi Nord, Coca-Cola, Diageo, H&M, Manchester United and Pets at Home.

APAC was broadly stable in operational terms, with constant-currency ARR falling by £0.2 million. Its reported increase came from a favourable movement in the Australian dollar against sterling.

This leaves investors with a mixed regional picture: genuine enterprise-led progress in EMEA and North America, but softer underlying performance in APAC.

Cost reductions are lifting profitability

Pulsar's operating model transformation is having a visible effect. Recurring administrative expenses declined to £16.4 million from £17.1 million, despite reported costs being affected by adverse currency translation.

On a constant-currency basis, recurring staff costs and other operating expenditure fell by approximately £1.1 million. This follows the removal of more than £7.0 million from the annualised cost base during the 2025 financial year.

Management expects the overall cost base to fall further by the end of FY26, primarily through continued automation. If revenue keeps growing while costs decline, Pulsar should benefit from operating leverage, where profit grows faster than revenue.

There is still work to do. Gross margin fell to 65% from 69%, while the Group remained loss-making on a statutory basis. The operating loss narrowed to £2.5 million and the loss before tax improved to £3.0 million, but neither measure has yet turned positive.

Non-recurring costs also remained material at £2.7 million, although this was down from £3.7 million. Capitalised development expenditure was £2.7 million, compared with £3.0 million a year earlier.

A useful measure disclosed by Pulsar is adjusted EBITDA after non-recurring costs and capitalised development expenditure. This improved to a £0.3 million deficit from a £3.0 million deficit. That is a substantial step in the right direction, but it also shows why adjusted EBITDA should not be viewed in isolation.

Cash generation improved, but net debt edged higher

Net cash generated from operations increased to £3.3 million from £1.8 million. Before working-capital movements, operating cash inflow was £2.5 million, compared with a broadly breakeven result in the prior-year period.

This supports management's argument that higher adjusted profitability is beginning to feed through into cash.

However, net debt increased slightly to £6.0 million from £5.6 million at the November year-end. Pulsar said the position was broadly flat before one-off refinancing fees, while working-capital timing also affected period-end cash collection.

During the half, the company secured new three-year facilities of £8.0 million from HSBC Innovation Banking. These comprise £6.0 million of loans and a £2.0 million revolving credit facility, replacing the previous £3.0 million loan and £3.0 million overdraft.

The refinancing gives Pulsar greater headroom and removes some near-term funding uncertainty. The Board expects stronger cash generation to support lower net debt in the second half, making debt reduction an important figure to watch in the full-year results.

AI products add opportunity, but commercial evidence is early

Pulsar continued rolling out Lumina, a collection of AI-native products designed for public relations and communications workflows. Its functions include narrative intelligence, real-time monitoring and automated media analysis.

Shortly after the period ended, the Group also launched Saga, described as an autonomous research agent for social intelligence. It runs continuously on customer data and is intended to deliver completed research proactively.

Management said the new products are showing early signs of market penetration. However, the announcement did not disclose product-level revenue, customer numbers or contract values. Investors therefore have evidence of launches and initial demand, but limited financial information with which to judge their contribution.

What matters for Pulsar investors now?

The main positive is that Pulsar is delivering growth and better profitability despite constrained marketing budgets and wider economic uncertainty. Revenue is increasingly recurring, enterprise demand is supporting EMEA and North America, costs are falling and operating cash generation has improved.

The less comfortable points are equally clear. A sizeable portion of reported ARR growth came from currency movements, APAC declined slightly at constant currency, gross margin fell and the Group remained loss-making after depreciation, amortisation and other costs. Net debt also edged up during the period.

For the second half, the key tests are whether Pulsar can accelerate constant-currency ARR growth, stabilise APAC, protect gross margin and turn its improved operating model into sustained cash generation and lower debt.

The interim results show meaningful progress, particularly in margins and cash flow. The next stage is proving that enterprise demand and new AI products can produce stronger underlying growth without relying on favourable exchange rates.