Research Solutions, under the ticker RSSS, has partnered with Third Iron to integrate its Article Galaxy Scholar (AGS) into the LibKey platform. This collaboration aims to enhance library services by offering streamlined, one-click access to a vast array of over 34,000 journals. Through this integration, libraries can now provide users with instant access to important content that goes beyond their standard subscriptions, eliminating complex procedures researchers typically endure when library holdings do not include the articles they need.
The LibKey and AGS integration is currently being tested with a select number of institutions, and it is set to expand to more users in the coming months. Further integration capabilities with other LibKey services are scheduled to be introduced by Summer 2025, broadening the reach and impact of Research Solutions' offering.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 2 analysts, the average target price for Research Solutions Inc (RSSS, Financial) is $4.68 with a high estimate of $5.00 and a low estimate of $4.35. The average target implies an upside of 66.37% from the current price of $2.81. More detailed estimate data can be found on the Research Solutions Inc (RSSS) Forecast page.
Based on the consensus recommendation from 3 brokerage firms, Research Solutions Inc's (RSSS, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Research Solutions Inc (RSSS, Financial) in one year is $2.90, suggesting a upside of 3.2% from the current price of $2.81. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Research Solutions Inc (RSSS) Summary page.
RSSS Key Business Developments
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Research Solutions Inc (RSSS, Financial) achieved a record high annual recurring revenue (ARR) of $20.4 million, marking a 23% year-over-year increase.
- The company's platform subscription revenue increased by 22%, driven by growth in both B2B and B2C platform revenue.
- Gross margin improved significantly to 49.5%, a 430 basis point increase from the previous year, due to a shift towards higher-margin platform business.
- The company reported a record adjusted EBITDA of $1.4 million, surpassing the previous company record.
- Research Solutions Inc (RSSS) is seeing strong growth in its AI-based products, with a 180% increase in the B2B enterprise license segment year-over-year.
Negative Points
- Transaction revenue for the third quarter decreased by 4% compared to the prior year, attributed to lower paid order volume.
- The total active customer count declined to 1,380 from 1,426 in the same period a year ago.
- There is uncertainty regarding the impact of recent budget cuts in government and academic institutions on the company's future business.
- The company has not yet fully leveraged AI internally to improve productivity or reduce costs, particularly in software engineering.
- B2C segment is experiencing seasonal weakness, with a decline in trials and sign-ups expected to continue through the end of June.
