Q4 2026 Research Solutions Inc Earnings Call Transcript
Key Points
- B2B ARR grew 14% year-over-year to $16.2 million, driven by new logo generation and upsells.
- AI-related bookings reached $800,000 in Q4, up 125% sequentially, with a strong pipeline for FY27.
- Gross margin hit a record 53% in Q4, up 200 basis points year-over-year, due to higher-margin platform revenue mix.
- Platform revenue now represents 43% of total revenue, up from 39% last year, improving overall profitability.
- Net income for fiscal 2026 rose to $2.8 million from $1.3 million, and adjusted EBITDA increased to $5.8 million.
- Cash and cash equivalents grew to $12.6 million with no debt, providing flexibility for earnout payments and strategic options.
- MCP deals are expanding existing customer contracts, on average doubling the contract value, and customers adopting MCP retain at higher rates.
- Development productivity improved 4x, enabling the release of two new AI products and integration with ChatGPT, Claude, and Copilot.
- Total revenue for fiscal 2026 declined 1.6% to $48.3 million, as transaction revenue fell 8.7%.
- Transaction revenue decreased 6.7% year-over-year in Q4, reflecting ongoing pressure on document delivery.
- B2C ARR declined by approximately $380,000 for the full year, and the segment is expected to remain flat amid competition.
- Net income for Q4 dropped to $666,000 from $2.4 million, and adjusted EBITDA decreased to $1.4 million from $1.6 million.
- Cash flow from operations for fiscal 2026 fell to $5.3 million from $7 million, due to timing of working capital payments.
- Total active customer count decreased to 1,323 from 1,338 a year ago, indicating challenges in customer acquisition or retention.
- The company expects continued low single-digit decline in transactions revenue for FY27, with no top-line growth guidance.
- Stock price is significantly undervalued, and management is evaluating options like buybacks but has no immediate acquisition plans.
(Operator instructions)
Good afternoon, everyone, and thank you for participating in today's conference call to discuss Research Solutions, financial and operating results for its fiscal fourth-quarter and full year ended June 30, 2026.
As a reminder, this conference is being recorded. I would like to now turn the conference over to your host, John Beisler, Investor Relations.
Thank you, operator. Good afternoon, everyone, and welcome to the Research Solutions fourth-quarter and full fiscal year 2026 earnings call.
On the call today are Roy W. Olivier, Chairman and Chief Executive Officer Dave Kuchel, Chief Financial Officer and Josh Nicholson, Chief Strategy Officer.
After the market closed this afternoon, the company issued a press release announcing its results for the fourth-quarter of full-year fiscal 2026. The release is available on the company's website at researchsolutions.com.
Before management begins their prepared remarks, I would like to
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