Cogstate has revised its first-half revenue guidance downward to $US25 million to $US26 million. While this represents a 5 per cent to 9 per cent increase compared to the prior corresponding period, it falls short of the company’s previous growth target of 18 per cent to 20 per cent and the consensus estimate of $US29.2 million. Cogstate is a neuroscience technology company that optimises the measurement of brain function to help people live better lives; it provides digital brain health assessments to detect subtle changes in cognitive performance.
Morgans research analyst Ian Wilkie attributes the downgrade to timing-related deferrals, noting that a larger portion of service revenue is now recognised over the duration of trials. Licence fees are projected to account for 19 per cent to 20 per cent of revenue, consistent with the first half of FY25. Contracted revenue for the second half of FY26 is forecast at $US21 million, suggesting full-year revenue of $US47 million to $US48 million, which is below the consensus estimates of $US57.7 million.
Margins are anticipated to decrease in the first half of FY26, with gross margin expected to be between 50 per cent and 52 per cent and EBITDA margin between 20 per cent and 23 per cent. This softening reflects ongoing investments in research and development, expansion in the Asia-Pacific region, and artificial intelligence development. Despite the revenue shortfall, Wilkie notes that underlying business momentum remains strong, bolstered by a record pipeline and a broadening contract base.
However, Wilkie suggests that FY26 consensus estimates will likely require downward revision due to the timing-related revenue shortfall. Following the announcement, shares in Cogstate experienced a significant decline, dropping by 19.5 per cent around midday.
