Highlights

• Stage 2 of the SEEK Growth Fund began on 1 November 2026 and is set to run for around five years.

• A performance fee on Core Assets is payable only if at least A$840 million of Liquidity is made available to investors.

• Net Revenue from continuing operations rose 10% to A$1,198.9 million in FY26, and adjusted profit rose 28% to A$199.1 million.

• Australia and New Zealand sales revenue rose 12%, as Job ad Yield increased 14% and offset a 2% fall in Australian volumes.

Why is Seek (ASX:SEK) changing the way it manages its venture Investment arm? The online employment marketplace wants to turn more of the SEEK Growth Fund's paper value into cash for shareholders, and its new arrangements, announced on 21 October 2026, tie the fund manager's rewards to returning Capital while trimming the fees Seek pays.

The central development: a reset for the SEEK Growth Fund

The SEEK Growth Fund holds stakes in technology businesses, many in human resources software. Seek owns about 83.8% of it, and its value swings have weighed heavily on Seek's statutory earnings.

Under the update, Stage 2 of the fund begins on 1 November 2026 and is set to run for around five years.

A performance fee on Core Assets is payable only if at least A$840 million of liquidity is made available to investors, on top of the A$233 million already returned since 2021. About A$700 million of that would flow to Seek. Until the A$840 million threshold is reached, the fund must distribute at least 80% of net proceeds.

Total fees payable by Seek are expected to fall to about A$17 million a year, from A$18 million. Seek will make no further capital contributions, and its ownership is expected to decline over time.

Why it matters

The fund has been a source of volatility.

So far, Seek has received A$196 million in distributions, equal to 13% of the capital it has invested. Chief executive Ian Narev said the fund has delivered a 12% Return on Investment since inception.

The update gives investors a clearer link between the fund and cash returns.

What Seek does

Seek operates online employment marketplaces in Australia, New Zealand and several Asian markets. It earns most of its revenue from employers paying to advertise jobs, with additional income from premium ad products and related services.

The key drivers are the Volume of paid job ads and yield, or the average revenue per ad. In recent years, Seek has leaned heavily on yield through ad tier upgrades, its Advanced ad product, Value-Based Pricing and inflation-linked price rises.

FY26 results: revenue up, statutory loss reported

For the year to 30 June 2026, Seek reported net revenue of A$1,198.9 million from continuing operations, up 10%. EBITDA rose 15% to A$529.9 million, a Margin of about 44%. Adjusted profit increased 28% to A$199.1 million, and free Cash Flow rose 21% to A$246.0 million.

On a statutory basis, the picture differed. Seek reported a loss of A$306.5 million from continuing operations and A$371.3 million across total operations. Alongside the fund's loss, it recorded a A$356.0 million Impairment linked to Zhaopin, the Chinese jobs Business in which it holds a minority stake.

The board declared a fully franked final Dividend of 25 cents, taking the full-year payout to a record 52 cents.

Segment performance shows the pricing story

In Australia and New Zealand, sales revenue rose 12% to A$945.4 million. Job ad yield increased 14%, offsetting a 2% fall in Australian job ad volumes. New Zealand volumes rose 8%.

In Asia, sales revenue increased 3% to A$253.5 million. Paid job ad yield rose 20%, while paid volumes fell 12% as Seek shifted towards a Freemium model and conditions in Hong Kong weakened. Total ad volumes and hirer numbers grew because of the freemium approach.

FY27 guidance and market reaction

For FY27, excluding the fund and significant items, Seek has guided to revenue of about A$1,210 million to A$1,280 million, EBITDA of A$530 million to A$580 million and adjusted profit of A$185 million to A$215 million.

Seek also upgraded its medium-term goals, targeting at least 10% annual yield growth through the cycle and mid-single-digit cost growth.

Commentary at the time pointed to guidance that implied modest growth, softer volumes and concerns about artificial intelligence changing recruitment. Those are market interpretations rather than company explanations.

Sector conditions and competitive position

Seek remains the largest online employment marketplace in Australia, and it reported stable Placement share across Australia and Asia in FY26.

Its pricing power has been a clear strength, with group yield growth in double digits for a sixth consecutive year. The trade-off is reliance on price increases while Australian job ad volumes soften. A cooling labour market could pressure volumes further.

Artificial intelligence is a longer-term uncertainty. Generative tools could change how employers and candidates find each other, which may affect Demand for traditional job Advertising over time, although the scale and timing of any impact are unclear.

Risks and what to monitor

The Zhaopin stake also remains exposed to conditions in China.

Seek's Annual General Meeting is scheduled for 18 November 2026, where investors may look for commentary on trading conditions. Progress on fund asset sales, including the previously announced process to sell the Employment Hero stake, and the size of any cash returned to Seek will also be closely watched.