Pinned straw:
I have been doing the same @GazD following recent share price pressure.
At a high level, the result is impressive enough. Nice increases to ARR and cash receipts vs pcp. You cant do much about FX movements working against you, either.
I came away with a different take to you though. @twee articulates the typical strength in the Q1 and Q2 quarters for Qoria, which we are obviously coming out of, and they haven't exactly shot the lights out. They are still a business in growth mode, but their growth looks like it is becoming more expensive -- go back a year and compare the quarters (as below), paying particular attention to advertising and marketing costs.
FY25 Q2
FY26 Q2
This is a semi red flag for me. I also don't buy them being cash flow positive argument when incorporating their development costs of 8m. That is a cost of doing business, so they are in the red -4m when you add that in.
So we have a business with significant debt, losing money (a few mil to be exact from this quarter) and are staring down the barrel of a half that is typically much weaker for them.
After the recent share price hammering, they are trading on a forward revenue of around 4x. That is more respectable, at least, and probably supports any argument that they were overpriced.
Perhaps I am being too harsh, but in this instance I think the market is right to punish them.
With QOR it's cyclical, so the bulk of the cash comes in H1, it's simplistic to just look at H1 FCF.
My 2 cents as someone who doesn't know the company well.
“ I do wonder if there are parallels to the Resmed ozempic crisis of confidence and we all know how that turned out.”
@GazD you’ve articulated precisely what I’ve been thinking.
Yes, AI will impact enterprise software, however I think it’s going to take time, and there will be winners and losers, IMO. Among the winners I expect to see those who today are experimenting and investing in AI. Not all will succeed.
As the saying goes:
“Reports of my death have been greatly exaggerated.”
Anyone would be a fool to deny that new technologies disrupt established business models.But I think the $RMD analogy is a good one. Yes there is an impact, but 3 years down the track there is as much evidence (or more) that it will be a positive one as there is that it will be negative. And in reality, I think it is fair to say that the jury is still out as to the long term impact.