Why Is Swift Networks’ Revenue Slipping Despite New Capital Raises?

Swift Networks’ Revenue and Loss Trends

Swift Networks Group Limited has reported a 3.5% decline in operating revenue for the fiscal year ended June 30, 2025, slipping to $17.7 million from $18.4 million the previous year. This downturn was driven primarily by lower project revenues and the impact of site closures at Mineral Resources, which curtailed subscription revenue growth. Subscription revenues, which make up 80% of total income, fell slightly to $14.2 million, down from $14.5 million in FY24.

The company’s loss after tax nearly doubled, widening from $1.68 million to $3.33 million. This significant increase was largely attributed to the derecognition of the carrying value and effective interest related to the PURE loan facility, amounting to $802,000, alongside a reduced gross margin on lower revenues.

Capital Raising and Loan Amendments

In response to financial pressures, Swift Networks launched an entitlement offer aiming to raise up to $3.3 million, closing at 71% subscription and raising $2.3 million before costs. A portion of these proceeds, $1.4 million, was used to reduce the principal on the PURE loan from $7.6 million to $6.2 million. The company also secured an amendment to the loan terms, extending the repayment date to March 31, 2027, and introducing new covenants including a minimum monthly cash balance of $1 million and a capex limit of $350,000 per quarter.

Cash reserves improved by 22% to $2.2 million, supported by operational cash receipts, financing activities, and controlled investing outflows primarily related to product development efforts.

Strategic Focus and Market Challenges

Swift Networks is directing its capital towards advancing product features and completing the development of Swift TV, alongside ramping up sales and marketing initiatives aimed at deepening penetration in the Mining and Aged Care sectors. However, the company faces headwinds as Mineral Resources has requested a shift from a three-year contract to a month-to-month arrangement starting October 2025. This change affects recurring revenue streams, with Mineral Resources currently accounting for $223,000 in monthly revenue and $65,000 in gross margin.

Despite these challenges, Swift Networks remains committed to exploring opportunities to strengthen its balance sheet and drive revenue growth, though the path forward will require navigating contract uncertainties and market delays.