A two-sided half

Audinate Group, the Sydney-based company behind the Dante audio-visual networking standard, has spent the first half of its 2026 financial year trying to convince the market that its worst period is behind it. The half-year results it lodged with the ASX on 16 February 2026 told a two-sided story: revenue growth returned for the first time in more than a year, but a step-up in operating spending pushed underlying earnings into a loss.

Investors continue to watch the stock closely ahead of the company’s full-year FY26 numbers, which Audinate has confirmed it will release on 17 August 2026 alongside a live investor webinar. In a separate notice lodged on 21 July 2026, the company detailed the briefing arrangements. This article reviews the most recent disclosures and is provided for information only; it is not financial advice.

 

Currency matters when reading the numbers

A note on presentation is warranted before the figures. Audinate reports revenue and gross profit in US dollars, reflecting that most of its sales are struck in that currency, but discloses earnings measures such as EBITDA in Australian dollars. Conflating the two is an easy trap. Where this article cites revenue and margins, the currency is US dollars (US).

 

Revenue growth returns

For the six months to 31 December 2025, Audinate reported revenue of US$21.1 million, up 12% on the US$18.9 million recorded in the prior corresponding half. Gross profit rose in step, up 12% to US$17.4 million, while gross margin held at an elevated 82.6%, marginally ahead of the 82.2% a year earlier.

The composition of that growth is instructive. Revenue from adaptors — standalone devices that bring legacy equipment onto a Dante network — jumped 51% to US$4.3 million. Embedded components, Audinate’s core business of chips, cards, modules and software sold to equipment makers, contributed US$13.9 million, with embedded software up 17%. Platform software revenue, which includes the Dante Director management tool, rose 9% to US$2.6 million.

The rebound follows a difficult FY25. In the year to 30 June 2025, revenue fell roughly a third to US$40.0 million from US$60.0 million, a decline the company attributed to an inventory overhang among original equipment manufacturer (OEM) customers and softer growth across the professional AV industry. Management has repeatedly characterised FY25 as a “transitional year” and said inventory rebalancing was largely complete heading into FY26.

 

Costs push underlying earnings into the red

The other side of the ledger was less comfortable. Underlying EBITDA swung to a loss of A$2.3 million, from a A$0.8 million profit in the prior corresponding period. On a statutory basis, reported EBITDA was a loss of roughly A$5.5 million once restructuring costs and acquisition-related payments were included — an important distinction between underlying and statutory measures that readers should keep in view.

The driver was cost growth. Underlying operating costs rose around 26% in the half, slightly ahead of the full-year guidance rate the company had previously flagged. Audinate has been investing to broaden its product suite beyond audio into video and control, a strategy that lifts near-term expenses ahead of the revenue it is designed to generate. Capitalised development spending also rose, to about A$6.4 million from A$5.8 million a year earlier.

 

The Iris bet on video and control

Central to that expansion is Iris, a camera-control subscription product Audinate launched in December 2025. The company said 10 camera manufacturers had been onboarded at launch. Iris represents an attempt to extend the Dante ecosystem — long dominant in networked audio — into the faster-growing video and control segments, while adding a recurring-revenue software layer.

The strategic logic rests on ecosystem breadth. Audinate reported 516 OEMs with Dante products already in the market and a further 207 developing new Dante-enabled products. Design wins, a leading indicator of future embedded revenue, rose to 66 in the half from 61 a year earlier.

 

Guidance and outlook

For the full FY26 year, Audinate reaffirmed guidance for US-dollar gross profit growth of 13-15% over FY25, with gross margin expected to remain broadly consistent with the prior year. Notably, the company trimmed its expectation for operating cost growth to 20% over FY25, down from a previously indicated 25% — a signal that management intends to moderate its spending trajectory in the second half after the first-half earnings outcome.

Because revenue is US-dollar denominated while a portion of the cost base sits in Australian dollars, the reported Australian-dollar earnings result remains sensitive to the AUD/USD exchange rate, a factor that can amplify or offset operational progress in any given period.

 

Share price and what to watch

Audinate shares came under pressure on the day the half-year result was released as investors assessed the swing to an underlying EBITDA loss against the return to revenue growth, before recovering some ground in subsequent trading. The stock has been a notable underperformer over the past year, trading well below levels seen twelve months earlier as the market recalibrated expectations following the FY25 downgrade cycle. Readers should treat single-session moves cautiously and refer to live ASX data for current pricing.

The key questions heading into the 17 August 2026 full-year result are whether the guided second-half cost discipline materialises, whether the return to revenue growth is sustained as OEM inventories normalise, and whether early Iris and video traction begins to convert into measurable revenue. Audinate’s high gross margins give it substantial operating leverage if volumes recover; the same structure works against it while revenue is subdued and investment elevated.

For now, the FY26 half-year confirms a company growing its top line again but still absorbing the cost of its expansion beyond audio. The full-year numbers due in August will test how quickly that investment converts to earnings. This article is provided for general information only and does not constitute financial advice; readers should seek independent professional advice and consult primary disclosures before making any decision.