Highlights

  • Felix Group shares rose 1.19% to AUD 0.085 on 24 April 2026 following its Q3 FY26 update.
  • Total Group ARR reached AUD 12.7 million, up 47% compared to the prior corresponding period.
  • Enterprise ARR increased to AUD 7.3 million, reflecting a 9% rise year-on-year.
  • Nexvia contributed AUD 3.4 million ARR, up 12% on the prior corresponding period.
  • Net operating cash outflow stood at AUD 1.2 million for the quarter.
  • Cash balance remained at AUD 5.7 million as of 31 March 2026.

Felix Group Holdings Ltd (ASX:FLX) shares moved 1.19% higher to AUD 0.085 during the afternoon session on 24 April 2026, following the release of its Q3 FY26 business update and Appendix 4C. While the stock recorded a modest gain on the day, it remains down 61.36% over the past year, indicating continued longer-term pressure despite the latest update reflecting a combination of growth in recurring revenue and ongoing cash outflows.

Felix Group operates a cloud-based Software as a Service (SaaS) procurement platform alongside a vendor marketplace, connecting enterprises with third-party suppliers through digitised workflows. The platform is designed to streamline procurement processes, improve transparency, and manage supply chain risk. The Company’s growth strategy is centred on expanding enterprise adoption, enhancing platform capabilities, and integrating acquired businesses such as Nexvia.

Recurring Revenue Growth Supported by Nexvia Integration

During Q3 FY26, Felix reported Total Group Annual Recurring Revenue (ARR) of AUD 12.7 million, representing a 47% increase from AUD 8.6 million in the prior corresponding period. This uplift was largely influenced by the inclusion of Nexvia, which contributed AUD 3.4 million ARR during the quarter, marking a 12% increase compared to the same period last year.

Enterprise ARR reached AUD 7.3 million, reflecting a rise of AUD 631,000 year-on-year, equivalent to a 9% increase. Growth in this segment was supported by new customer additions and contract expansions, although partially offset by churn of AUD 121,000 due to one customer exiting and another reducing their licence.

The Company reported enterprise Net Revenue Retention (NRR) of 97% at the end of the quarter. While this figure remains below the 100% threshold typically associated with expansion-led growth, management indicated that ongoing platform enhancements, including artificial intelligence (AI) capabilities, are expected to support improved customer retention and contract expansion over time.

New Customer Wins and Contract Expansions Add to ARR Base

Felix secured four new enterprise customer contracts during the quarter, including its first entry into the education sector through a three-year agreement with Brisbane Catholic Education. This contract involves an initial deployment to 30 users and contributes AUD 166,000 in ARR, with a total contract value of AUD 498,000 over the term.

Additional customer wins included MacKellar Group, Enerven, and Develop Global Limited, expanding Felix’s presence across sectors such as mining services, infrastructure, and utilities.

Alongside new wins, the Company executed three expansion agreements with existing customers, including SRG Global, McConnell Dowell, and 29 Metals. These expansions collectively added AUD 34,000 in ARR and were driven by additional platform integrations, increased user adoption, and contract renewals.

Vendor Marketplace and Nexvia Customer Metrics Continue to Expand

Felix’s Vendor Marketplace recorded 127,018 vendors during Q3 FY26, reflecting an 8% increase compared to the prior corresponding period. This growth indicates continued adoption of the platform by suppliers and integration into enterprise procurement workflows.

Nexvia’s customer base also expanded during the quarter, reaching 196 customers, up from 165 in Q3 FY25. The increase was partly supported by the migration of four Vendor Marketplace customers onto the Nexvia platform.

The Company noted that softer quarter-on-quarter ARR growth for Nexvia was linked to the reallocation of two sales resources from Vendor Marketplace to Nexvia. This transition is expected to support improved sales momentum in future periods.

AI Development and Platform Enhancements Underway

Felix continued to progress the development of artificial intelligence features across its Vendor Management and Sourcing modules. These enhancements are focused on automating vendor assessment and bid analysis processes, which are typically resource-intensive within procurement workflows.

The Company is undertaking a structured co-development approach with selected customers to validate these AI features in real-world scenarios before broader rollout. This method is intended to ensure that new capabilities are aligned with user needs and provide immediate utility upon release.

During the quarter, Felix developed a working prototype for AI-based interrogation of bid documents. The Company expects to integrate this functionality into its Sourcing module in Q4 FY26, enabling automated analysis and synthesis of complex bid data into actionable insights.

Management views the integration of vendor management and sourcing intelligence as a key differentiator, with AI expected to enhance platform stickiness and support both customer retention and acquisition.

Engagement Metrics Reflect Increased Platform Usage

Key engagement indicators showed growth during the quarter, reflecting increased usage of the platform by enterprise customers. The number of active projects rose by 25% compared to the prior corresponding period, while requests for quotations (RFQs) increased by 43%.

Additionally, total active vendor compliance documents grew by 39%, and enterprise user accounts increased by 27%. These metrics suggest deeper integration of the platform into customer operations and broader adoption across procurement functions.

Leadership Changes Signal Strategic Transition

The quarter marked the completion of a leadership transition, with the appointment of a new Chairman and Chief Executive Officer.

Dominic O’Hanlon assumed the role of Non-Executive Chairman in February 2026, bringing experience in scaling technology businesses and listed company governance. Chris Atkin was appointed Chief Executive Officer effective 1 April 2026, with over two decades of experience in software and technology sectors.

The leadership changes are aligned with Felix’s focus on integrating Nexvia, expanding enterprise ARR, and advancing its product roadmap.

Cash Flow Position and Balance Sheet Overview

Felix reported customer receipts of AUD 3.9 million for the quarter. However, net operating cash outflows amounted to AUD 1.2 million, reflecting ongoing investment in operations, staffing, and platform development.

Operating expenses included AUD 3.35 million in staff costs and AUD 1.37 million in administration and corporate costs. Research and development spending totalled AUD 225,000, while advertising and marketing expenses were AUD 165,000.

At the end of Q3 FY26, the Company held AUD 5.7 million in cash and cash equivalents, compared to AUD 7.16 million at the beginning of the quarter. Based on current cash usage, Felix has an estimated funding runway of approximately 4.65 quarters.

Investing activities during the quarter included AUD 161,000 spent on intellectual property, while financing activities reflected AUD 122,000 in loan repayments.

What This Means for Investors?

Felix Group’s Q3 FY26 update presents a mixed operational picture, combining growth in recurring revenue and customer metrics with ongoing cash outflows and slightly lower retention levels.

The increase in ARR, supported by Nexvia integration and new customer wins, appears to have contributed to the modest share price movement during the session. At the same time, continued investment in product development, particularly in AI capabilities, and the Company’s cash position remain key factors for investors monitoring execution.

With leadership changes now completed and platform enhancements underway, market participants are likely to focus on the Company’s ability to convert engagement growth into sustained revenue expansion and improved cash flow metrics in upcoming quarters.

Frequently Asked Questions (FAQs)

Why did Felix Group shares rise on 24 April 2026?
Felix Group shares increased by 1.19% to AUD 0.085 after the Company released its Q3 FY26 update, which showed growth in annual recurring revenue, supported by Nexvia integration and new customer wins.

What was Felix Group’s ARR in Q3 FY26?
The Company reported Total Group ARR of AUD 12.7 million, representing a 47% increase compared to the prior corresponding period.

How did Nexvia contribute to the results?
Nexvia contributed AUD 3.4 million in ARR during Q3 FY26, reflecting a 12% increase year-on-year and supporting overall revenue growth.

What was Felix Group’s cash position at the end of the quarter?
Felix held AUD 5.7 million in cash and cash equivalents as of 31 March 2026.

Did Felix report positive cash flow during the quarter?
No, the Company reported net operating cash outflows of AUD 1.2 million for Q3 FY26.