How Will Audinate’s Iris Acquisition Shape Its Recovery After FY25 Revenue Drop?

Financial Performance Amid Industry Challenges

Audinate Group Limited, a global leader in digital Audio Visual networking solutions, disclosed its FY25 results marked by a significant revenue decline and a return to net loss. Revenue fell 32.3% to $62.1 million, primarily due to a temporary inventory overhang among OEM customers and a softening growth environment in the AV industry. This inventory correction delayed new orders for Audinate’s core Dante-enabled chips, cards, and modules.

Despite the revenue setback, the company managed to maintain underlying EBITDA at a near break-even level of $26,000, a steep drop from $20.3 million the previous year. The net loss after tax widened to $6.4 million, reversing the prior year’s $10.2 million profit. These results reflect both the cyclical pressures and continued investment in the business.

Margin Expansion and Strategic Shift to Software

Audinate’s gross margin improved markedly to 82.3%, up from 74.3% in FY24, driven by a favourable product mix shift towards higher-margin software-based solutions. The company highlighted growth in software revenue streams, including subscription and license fees, which are becoming an increasingly important part of its business model. This transition supports scalability and positions Audinate to penetrate broader market segments with improved unit economics.

The company also reported a stronger second-half performance, with revenue increasing 12% compared to the first half, suggesting that the OEM inventory correction is largely behind it. Audinate continues to invest heavily in research and development, with $15.3 million spent in FY25 to advance its platform in audio, video, and AV control technologies.

Acquisition of Iris Studio Inc. and Platform Expansion

In a significant strategic move, Audinate completed the acquisition of Iris Studio Inc. in July 2025, a US-based leader in AI-powered, cloud-based camera control technology. This acquisition expands Audinate’s video capabilities and aligns with its vision for interoperable control and management of AV-over-IP devices across audio and video domains.

The Iris acquisition, valued at up to US$28 million, is expected to accelerate Audinate’s entry into new growth segments and enhance its software-centric workflows. The company anticipates a positive contribution to free cash flow from Iris within three to four years, reflecting a long-term investment horizon.

Leadership Transition and Governance

FY25 also saw leadership changes, with Chair David Krall retiring and Alison Ledger appointed as the new Chair. The Board remains focused on executing the company’s strategic priorities and delivering long-term shareholder value. Audinate’s remuneration framework continues to align executive incentives with performance, balancing short-term challenges with long-term growth objectives.

Robust Cash Position and ESG Commitment

Audinate ended FY25 with a strong cash and term deposit balance of approximately $110 million, providing a solid financial foundation to support ongoing investments and strategic initiatives. The company also reinforced its commitment to environmental, social, and governance (ESG) principles, including achieving ISO 27001 certification for cybersecurity and advancing diversity and inclusion across its global workforce.

Looking ahead, Audinate enters FY26 with a renewed focus on growth execution, leveraging its expanded product portfolio and ecosystem scale to navigate industry dynamics and capitalise on emerging opportunities in AV networking.