Key Highlights

  • The FY26 result was released on 18 August 2026, showing continued Revenue and profit growth.
  • The company reported an EBIT Margin of about 74.9% in FY26.
  • Pro Medicus carries no Debt and continues to renew its contract book.
  • Revenue starts only once a customer site goes live, so contracts signed late in a year add more to the following year.

What does Pro Medicus's latest result tell us about a Business whose shares have swung so widely over the past year? It shows a company that is still growing revenue and profit at a pace few listed software companies manage, with very high margins, no debt and a contract book that keeps getting renewed. The company (ASX:PME) operates in this market.

How the business makes money

Pro Medicus develops Visage, a cloud-capable medical imaging platform used by hospitals and radiology groups, mainly in the United States. Customers sign multi-year contracts, typically five to ten years, and pay a fee per imaging transaction, often subject to minimum commitments. Revenue starts only once a site goes live, so there is a lag between signing a contract and earning from it.

The model is attractive because incremental costs are low once the software is built.

FY26 results

Revenue: A$261.7 million, up 22.9%.

Underlying EBIT: A$196.1 million, up 24.4%.

Underlying net profit after tax: A$144.7 million, up 24.1%.

Cash and financial assets: A$252.3 million, with no debt.

Total dividend: 69 cents per share, fully franked, up 25.5%, including a final Dividend of 37 cents.

Currency was a headwind. The more encouraging Australian dollar reduced reported revenue by about A$12 million and profit by A$9.8 million, so in constant currency revenue grew 28.4%, EBIT 30.6% and net profit 32.5%. Chief executive Dr Sam Hupert said the company had exceeded its aim of 30% growth in EBIT and NPAT on a constant-currency basis.

Contracts and implementation

The result included an encouraging sales year. Pro Medicus signed ten new contracts worth at least A$407 million, including a ten-year agreement with UC Health Colorado and a seven-year agreement with Beth Israel Lahey Health. All six contracts due for renewal were renewed, on five-year terms worth a combined A$141 million, with higher minimum commitments and fees. Management cited a historical renewal rate of 100%.

Sixteen implementations were completed during FY26, including the first cohorts of the Trinity Health rollout, which management says is now largely complete.

Management also pointed to planned products in digital pathology and AI-optimised reporting, which are not yet reported revenue.

What FY27 could look like

Because revenue is tied to transaction Volume at live sites, the sites that went live late in FY26 should add revenue in FY27 without any new sales. Dr Hupert expects "a significant step-up in transaction revenue" as those sites contribute a full year. This is a management expectation, not guidance with a number attached, and actual transaction volumes depend on hospital activity and contract terms.

Competitive position

The imaging software market in the US includes large incumbents and picture archiving and communication system vendors, as well as cloud-native providers. Pro Medicus's pitch is speed and performance of its viewer, which has helped it win academic medical centres and large health systems. A 100% renewal record is a useful indicator of customer satisfaction, but it is a record, not a guarantee. Procurement cycles can be long and lumpy, so signing patterns vary from year to year.

The wider software sector has also been under pressure from fears that artificial intelligence will erode Demand for subscription software. So far the company says AI has not affected its renewals, and it is positioning AI as a product opportunity, but this is a risk worth monitoring.

Risks and what to monitor

Currency: dollar affects reported results because revenue is earned largely in US dollars.

Concentration and timing: contract signings are lumpy, and revenue depends on go-live dates that the company does not fully control.

Competition and AI: new entrants or AI-driven changes in how imaging is read and stored could pressure renewals or pricing.

Execution: delivering the digital pathology and AI reporting products on schedule.

Upcoming developments

Investors will watch new contract announcements, the half-year result due in early 2027, and go-lives at newly signed sites including Virtua Health.

The takeaway

Pro Medicus continues to combine growth, encouraging margins and a debt-free balance sheet, supported by an encouraging contract pipeline. The open question is price rather than product quality.