Xtract One revenue jumps 108% to C$28.8 million in 2026
Key Facts
Xtract One reported on October 21 results for the fiscal year ended July 31, 2026, posting revenue of C$28.8 million, up 108% from C$13.9 million the previous year. Fourth-quarter revenue rose to C$8.2 million from C$3.3 million in the year-earlier period, an annual increase of 144%. The company said the results reflected a record number of SmartGateway deployments, along with the first full year of commercial deployment for its Xtract One Gateway product. The chief financial officer said the latter product contributed more than a third of annual revenue. The results highlight the expansion of commercial activity, with the cost of scaling continuing to weigh on margins.
Revenue growth coincided with a decline in annual gross margin to 58% from 66% in fiscal 2025. The company attributed the drop to higher initial production and installation costs for its Xtract One Gateway product in its first year, and to its larger share of installations. The impact was also evident in the fourth quarter, when margin fell to 57% from 71% in the year-earlier period. The company said the higher proportion of Gateway installations increased production and installation costs during the quarter. Meanwhile, annual operating expenses rose 13% to C$24 million from C$21.1 million, with the increase attributed mainly to higher sales and marketing expenses. Expense growth came in below the 108% increase in revenue.
The contracted backlog stood at C$25.6 million at the end of the fiscal year, compared with C$15.5 million a year earlier, an increase of 66%. The company said C$10.5 million of that backlog is expected to be recognized as revenue over the following twelve months. The expected portion is included in what the chief executive described as a growing recurring revenue base as fiscal 2027 began. The chief executive also described the company’s two products as complementary and proven, and said the balance sheet funds the company’s plan while its pipeline is expanding to include Fortune 100 institutions. These indicators link the existing backlog with revenue the company expects to record in the coming period.
The company ended the fiscal year with cash liquidity of C$17.3 million, compared with C$8.2 million at the end of the previous fiscal year, and no debt. It used C$3.5 million in operating activities during the year, down from C$6.5 million a year earlier. The fourth quarter generated positive operating cash flow of C$1.9 million, compared with the use of C$1 million in the year-earlier period. The chief executive said second-half revenue reached a record C$18.5 million, compared with C$6.8 million in the second half of fiscal 2025. He added that performance came close to adjusted earnings before interest, taxes, depreciation and amortization break-even during that half.
On bookings, the results materials reported that the contracted backlog rose to C$25.6 million from C$15.5 million, with C$10.5 million expected to convert to revenue over the following twelve months. This timing provides a framework for what could enter the accounts in fiscal 2027, while the company said it has a growing recurring revenue base. Management also pointed to two complementary products and an expanded pipeline that includes Fortune 100 institutions. Gateway installation costs in its first year remain a factor in assessing performance, after being linked to the annual and quarterly margin declines. The stock closed at 0.38017 on October 21, the day results were announced, then at 0.3211 on October 22 and 0.31718 on October 23, according to EL7’s Xtract One data.