ASX 200 tech stock down 10% despite 'continued progress' in H1 FY25

Investors obviously had higher expectations from the software platform.

| More on:
A man looking at his laptop and thinking.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

ASX 200 tech stock SiteMinder Ltd (ASX: SDR) is in the red on Wednesday following the company's H1 FY25 earnings results.

Shares in the software platform are currently trading at $5.70 each, more than 10% lower from the open.

Let's jump in and see what the company reported for H1.

Created with Highcharts 11.4.3SiteMinder PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.com.au

ASX 200 tech stock slips on first-half numbers

SiteMinder put up several growth numbers in the first half. Here's some of the main data points from the results:

  • Annualised recurring revenue (ARR) grew 18.4%, reaching $216.2 million
  • This was driven by a 31.5% increase in transaction ARR
  • Total revenue increased by 13.9% year over year to $104.5 million
  • Underlying pre-tax income came to $5.3 million, up from a loss of $1.2 million in H1 FY24
  • Net customer additions rose to 2,700, with a 50% growth in net rooms added
  • Net loss of $13.9 million, similar to last year's $14.9 million loss

What else happened in H1 FY25?

SiteMinder said it made "continued progress" throughout the first half, with the ASX 200 tech stock booking an 18% growth in ARR.

Subscription revenues were up nearly 10% year over year, whereas transactional revenues stole the show, up 31% over the year.

The Smart Distribution Program is underway, and the Channels Plus product is now generally available, more than doubling the number of participating hotels.

Meanwhile, the ratio of customer lifetime value (LTV) to customer acquisition cost (CAC) improved as CAC narrowed to $4,463 versus over $4,800 this time last year.

SiteMinder also pressed on in the ongoing development of its "Smart Platform", with its "Dynamic Revenue Plus" service set for a March 2025 release in Berlin. This may or may not impact the ASX 200 tech stock.

What did management say?

Sankar Narayan, CEO and Managing Director of SiteMinder, said the company had laid "the foundations" for continued growth.

The last six months have seen us focus our efforts on laying the foundations for strong top line and bottom line performance in the future. Pleasingly, our results show that our Smart Platform strategy has begun delivering revenue and is driving acceleration in ARR growth.

And, it's just the beginning. We continue to make strong progress with the impending Northern Hemisphere release of Dynamic Revenue Plus incorporating dynamic pricing recommendations from IDeaS. Channels Plus is now released everywhere, and the Smart Distribution Program commenced.

All of these programs have been designed to help fulfill our mission of making sophisticated revenue management accessible to every hotel in the world and realise the full potential of our ecosystem, which today delivers over 125 million annual reservations for our hotelier customers.

What's next?

Management reaffirmed previously outlined guidance on growth and profitability in today's release.

This includes "targeting a 30% organic annual revenue growth" over the mid-term.

It also expects to be free cash flow (FCF) positive by the end of FY25 and to make further progress on "the Rule of 40", a key software industry metric.

According to consulting firm McKinsey, the Rule of 40 is where a software company's "growth rate when added to its free cash flow rate should equal 40% or higher".

The company says it has made "significant progress in globalising its workforce".

This includes increasing the share of employees in Asia and Latin America to around half of the entire workforce.

ASX 200 tech stock snapshot

This ASX 200 tech stock is in the red today following the release of its first-half results for FY25.

Zooming out, the stock is still up 11% over the past year of trade.

Should you invest $1,000 in De Grey Mining Limited right now?

Before you buy De Grey Mining Limited shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and De Grey Mining Limited wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended SiteMinder. The Motley Fool Australia has positions in and has recommended SiteMinder. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Earnings Results

Miner looking at a tablet.
Gold

Newmont share price lifts off on first-quarter results

The ASX 200 gold stock is charging higher on Thursday.

Read more »

A man wakes up happy with a smile on his face and arms outstretched.
Healthcare Shares

ResMed shares jump 8% on strong Q3 update

It was yet another strong quarter from this high-quality company.

Read more »

A woman sits at her computer with her chin resting on her hand as she contemplates her next potential investment.
Financial Shares

Up 53% in a year, why is this ASX 200 financial stock leaping higher again today?

Investors are sending the ASX 200 financial stock soaring on Wednesday. Let’s see why.

Read more »

Man with rocket wings which have flames coming out of them.
Share Gainers

Why is this ASX 200 uranium stock rocketing 17% on Wednesday?

The ASX 200 uranium stock is racing higher today. But why?

Read more »

Piggy bank at the end of a winding road.
Dividend Investing

Why this $44 billion ASX 200 dividend stock is pushing higher today

The ASX 200 dividend stock trades on a yield of 4.6%.

Read more »

Workers inspecting a gas pipeline.
Energy Shares

Why is the Santos share price racing ahead of the ASX 200 today?

Santos shares are enjoying a day of strong outperformance. But why?

Read more »

A man holds his hand under his chin as he concentrates on his laptop screen and reads about the ANZ share price
Financial Shares

What's happening with the AMP share price on Thursday?

A lot of AMP shares are changing hands on Thursday. But at what price?

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

Pilbara Minerals share price falls on 30% quarterly revenue slump

ASX investors are bidding down Pilbara Minerals shares on Thursday. Here’s why.

Read more »