Highlights

  • Pentanet faces a defining test as its latest strategy develops.
  • Cloud gaming delivers stronger margins, but a thin cash balance complicates GPU expansion.
  • The latest financial figures show why execution matters for 5GG investors.
  • Investors must weigh the next milestones against funding and operating risks.

Pentanet (ASX:5GG) is steering money towards its cloud gaming Business because that is where its margins and Earnings growth are strongest, even though the group still made a loss in FY26. On 31 August 2026 it reported Revenue of A$24.4 million, group EBITDA of A$2.4 million and a net loss after tax of A$6.9 million, and on 3 September 2026 it laid out a strategy built around expanding graphics processing capacity.

Two businesses under one roof

Pentanet Limited is classified by the ASX in the Communication Services sector, under Telecommunication Services.

CloudGG operates as an NVIDIA GeForce NOW Alliance Partner for Australia and New Zealand.

The FY26 numbers

Gaming revenue grew 16 per cent to A$2.8 million at a gross Margin of 68 per cent, and its EBITDA rose 61 per cent to A$1.7 million. Telecommunications revenue rose 7 per cent to A$21.6 million at a gross margin of 46 per cent, with EBITDA of A$2.0 million.

Group revenue rose 8 per cent and EBITDA rose 74 per cent, with gaming now supplying about 46 per cent of group EBITDA despite only about 11 per cent of revenue.

The headline loss includes a one-off A$4.0 million Impairment on second-generation GeForce NOW servers, a non-cash charge reflecting older hardware being worth less.

Why gaming is the priority

The company said the share of customers on its top Ultimate tier rose from 39 per cent in June 2025 to 59 per cent in June 2026.

That trade-off, fewer but higher-paying users, helps explain the margin gain. Registered accounts are about 840,000, so the commercial question is how many convert to paying subscribers.

The strategy update describes four pillars: hold the telco base of roughly 19,000 subscribers as a cash engine, maintain fixed wireless without new capital, expand a low-touch gaming internet offer using the NBN, and prioritise adding NVIDIA Blackwell servers.

The telecommunications base

Telco subscribers rose 4 per cent to 18,936, of which 6,137 are on Pentanet's own network and 12,799 are off-net. Average revenue per user was A$96 and monthly churn was 1.3 per cent.

The business has 1,039 5G subscribers, up 15 per cent, though the strategy update says no new Capital will go into fixed wireless until it can compete at gigabit speeds.

Because telco produces most of the revenue, its steady cash generation is what funds gaming expansion.

Risks and what to watch

Liquidity is the key risk: A$1.5 million of cash is thin against a business that has to buy expensive GPU hardware. Any large server order may need funding, which could dilute existing shareholders.

The company also depends on its NVIDIA Partnership and on hardware cycles, as the impairment shows. Competition in broadband and cloud gaming is intense, and the Market Value on the ASX data checked was only about A$7 million.

Pentanet ceased quarterly reporting on 22 April 2026, so the next scheduled disclosures are likely to be its half-year results, which were released on 25 February in 2026.