Highlights

  • Objective Corporation (ASX:OCL) reported FY26 Revenue growth of 9% and adjusted EBITDA growth of 11%.
  • SaaS revenue increased 22%, highlighting continued progress in the company’s cloud transition strategy.
  • The company maintained strong profitability with a 39% adjusted EBITDA Margin and significant cash reserves.
  • Investors remain focused on replacing lost Defence-related Recurring Revenue through newer growth platforms.

Objective Corporation (ASX:OCL) delivered its FY26 full-year results on 27 August 2026, highlighting continued Earnings growth, strong software margins and progress in its transition towards cloud-based solutions.

The results come after the company faced a major change during the year following the non-renewal of a long-standing Defence support agreement. While the contract loss affected recurring revenue expectations, the FY26 result demonstrated the resilience of Objective’s broader software portfolio and the strength of its subscription-based model.

FY26 Results

For the year ended 30 June 2026, Objective reported revenue of $134.7 million, increasing 9% compared with $123.5 million in FY25.

Adjusted EBITDA increased 11% to $51.5 million, maintaining a strong margin of approximately 39%.

Net profit after tax increased 5% to $37.2 million, while Earnings Per Share increased to 38.9 cents.

The company continued generating a high proportion of recurring revenue, with subscription-based software revenue representing 100% of software revenue during FY26.

Recurring revenue accounted for 86% of total customer revenue, highlighting the stability of Objective’s Business model.

The company declared total FY26 dividends of 26 cents per share, including a final fully franked Dividend of 8 cents per share and a final unfranked dividend of 5 cents per share.

SaaS and Recurring Revenue

Software-as-a-service growth remained a key focus during FY26.

SaaS revenue increased 22%, reflecting continued customer migration towards cloud-based solutions and subscription models.

Annualised recurring revenue (ARR) ended the year at $117.3 million, down 2% from $120.2 million in FY25.

The decline in ARR was mainly influenced by the reduction in Information Intelligence ARR, which decreased 5% to $80.9 million.

However, other business lines continued expanding, with Regulatory Solutions ARR increasing 4% to $17.6 million and Planning & Building ARR increasing 3% to $18.7 million.

The company continues focusing on growing recurring revenue through cloud adoption, product expansion and deeper engagement with government and regulated-sector customers.

Business Performance

Objective’s three major business areas delivered mixed but generally positive outcomes during FY26.

Information Intelligence remained the largest business segment, generating sales revenue of $87.9 million. While ARR declined during the year, the division continues supporting Objective’s core government software operations.

Planning & Building delivered strong growth, with sales revenue increasing 41% to $18.5 million. The division continues benefiting from Demand for digital planning and building solutions.

Regulatory Solutions also continued expanding, with revenue increasing 7% to $25.3 million and ARR growth supported by adoption among regulated organisations.

The Diversification across multiple software solutions provides Objective with additional growth opportunities beyond its traditional enterprise content management business.

Defence Contract Transition

The FY26 result follows the company’s decision to manage the impact of the Australian Defence support agreement ending.

The long-standing arrangement had been a significant contributor to Objective’s Information Intelligence operations, and its non-renewal reduced expectations for ARR growth.

However, the company has emphasised that Defence remains a user of Objective technology and that future opportunities may still exist.

Management is redirecting resources previously allocated to Defence-specific support activities towards Objective Nexus, cloud solutions and broader opportunities across government and regulated industries.

The ability to replace the lost recurring revenue through new customer wins and cloud migration will remain a key measure of future performance.

Growth Strategy

Objective continues investing heavily in product development and innovation.

During FY26, the company invested $33.8 million in research and development, representing approximately 30% of software revenue.

The Investment supports ongoing development of Objective’s software platforms, including cloud migration initiatives and product enhancements.

The company’s strategy is focused on helping government and regulated organisations move towards secure digital environments, with demand supported by increasing requirements around information governance, security and digital transformation.

Financial Position

Objective maintained a strong Balance Sheet during FY26.

Operating cash flow increased to $49.3 million, compared with $46.3 million in FY25.

Cash at balance date was $92.7 million, after Shareholder dividends, share Buybacks and acquisition-related payments.

The company completed the Acquisition of Isovist during the year and continued maintaining financial flexibility.

Objective has no external borrowings, providing capacity to invest in future growth opportunities and potential acquisitions.

Investor Focus

Key areas investors will monitor include:

  • Replacement of Defence-related recurring revenue through new contracts and cloud growth.
  • Continued SaaS revenue expansion and customer migration.
  • Growth momentum across Planning & Building and Regulatory Solutions.
  • Returns from ongoing R&D investment.
  • Future Capital allocation decisions given the company’s strong cash position.

Risks

Objective continues to face customer concentration risks, particularly following the loss of a long-standing Defence agreement.

Government software markets can also be influenced by procurement cycles, budget decisions and changing priorities.

The transition towards cloud platforms requires continued investment and successful customer migration.

While recurring revenue provides stability, slower-than-expected SaaS adoption or delays in new contract wins could affect future growth.

Outlook

Objective enters FY27 with a strong financial foundation, high recurring revenue exposure and continued SaaS momentum.

The FY26 results demonstrate that the company’s broader software portfolio continues delivering growth despite the impact of the Defence contract transition.

The next phase will depend on whether Objective can accelerate growth in newer platforms, expand international opportunities and replace lost recurring revenue through cloud adoption.

For investors following ASX software stocks, Objective remains positioned around government technology transformation, with future performance likely to be shaped by SaaS growth, customer expansion and execution of its cloud strategy.