Can ikeGPS Sustain Growth Amid Fibre Market Volatility and Rising Competition?

Strong Financial Momentum

ikeGPS Group Limited (ASX, IKE) has delivered another impressive performance in the first half of FY26, underscoring its accelerating growth trajectory in the infrastructure software sector. The company reported a 47% increase in the exit run rate of platform subscription revenue, reaching an annualized NZ$19.4 million. Recognized subscription revenue grew 35% year-on-year to approximately NZ$8.8 million, while total revenue rose 5% to NZ$12.8 million despite some softness in lower-margin services linked to the volatile fibre communications market.

Gross margin expanded significantly to 75%, up from 67% in the prior corresponding period, reflecting the company’s successful shift towards higher-margin subscription software products. Notably, operating expenses remained flat compared to the previous year, highlighting effective cost management amid growth.

Innovating with AI, The PolePilot™ Launch

One of the standout developments this period is the launch of PolePilot™, an AI-driven companion module integrated into ikeGPS’s flagship IKE Office Pro platform. This innovative tool automates complex engineering workflows for electric utility distribution network analysis, significantly reducing the time and expertise required to assess pole loading and infrastructure condition.

By leveraging advanced artificial intelligence, PolePilot™ processes field data, identifies components, flags issues, and generates detailed reports in minutes rather than hours. This breakthrough not only enhances productivity for utility engineers but also drives increased average revenue per user (ARPU) for ikeGPS, positioning the company as a leader in intelligent automation within its niche.

Capital Raise Fuels Expansion

In August, ikeGPS successfully completed a heavily oversubscribed capital raise, securing approximately NZ$26 million (A$24 million) through a combination of institutional placement and retail share purchase plan. This strong investor support validates market confidence in ikeGPS’s strategic direction and growth potential.

The fresh capital will accelerate development of next-generation platform capabilities, including further AI enhancements, and expand sales, marketing, and customer success teams to capture growing demand. The company’s robust cash position of NZ$34 million and zero debt provide ample runway to execute these initiatives.

Leadership and Market Outlook

Adding to its growth momentum, ikeGPS appointed Paul Cardosi as Chief Financial Officer. Cardosi brings extensive experience scaling high-growth SaaS businesses in infrastructure and construction technology sectors, reinforcing ikeGPS’s leadership as it targets the North American electric utility market.

The broader market environment remains highly favourable, driven by substantial infrastructure investments in grid modernization, renewable energy integration, and network upgrades. ikeGPS’s expanding customer base and strong sales pipeline reflect sustained demand for its platform solutions.

CEO Glenn Milnes expressed confidence in delivering FY26 guidance, which anticipates approximately 35% or greater growth in subscription revenue and EBITDA breakeven on a run-rate basis in the second half of the year.