TechnologyOne Ltd (ASX: TNE) shares are on the move on Tuesday.
In morning trade, the ASX 200 tech stock is up 12% to $37.08.
This follows the release of the enterprise software provider's half year results.
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ASX 200 tech stock rockets on results day
TechnologyOne was on form during the first half of FY 2025 and delivered another record result.
For the six months ended 31 March, the ASX 200 tech stock reported a 19% increase in revenue to $291.3 million and a 21% jump in annualised recurring revenue (ARR) to $511.1 million.
This means that TechnologyOne has reached its $500 million ARR target 18 months ahead of schedule.
While all verticals delivered ARR growth during the half, the key drivers were its Local Government, Education, and Government verticals. And with each vertical in the APAC region not exceeding 15% of its addressable market, management believes there is still significant room to grow in the future.
Also supporting its growth was its UK business, which recorded a 50% jump in ARR to $43.1 million.
And with total expenses growing slower than revenue at 14% to $209.4 million, TechnologyOne posted a 33% increase in profit before tax to $81.9 million and a 31% lift in profit after tax to $63 million.
This allowed the ASX 200 tech stock's board to increase its interim dividend to a record of 6.6 cents per share.
16 years of record profits
TechnologyOne's CEO, Ed Chung, was pleased with yet another period of record profits. He said:
Once again we have delivered record first half ARR, revenue and profit for the 16th consecutive year. We have a new ambitious goal of $1b+ ARR by FY30 as we surpassed $500 million in ARR eighteen months earlier than planned, an incredible achievement for our Company.
SaaS+, our game changing offering which combines our vertical specific and mission critical SaaS ERP and implementation with the fastest implementation times in our market, is delivering. It is fuelling our growth and enabled us to deliver a first half profit before tax of $81.9 million, underpinned by ARR growth of 21%.
Guidance
Also giving the ASX 200 tech stock a boost today has been an upgrade to its guidance for FY 2025.
In light of its strong first half performance, management has lifted its net profit before tax growth guidance to 13% to 17%. Chung said:
We have clear visibility and confidence in our pipeline, which enables us to continue to invest in talented staff and new areas of growth such as SaaS+, Artificial Intelligence, DXP, App Builder and our UK business. The Company is well positioned to deliver strong growth over the full year. We indicated that we would continue to step up our profit growth and for FY25, we have stepped up our Net Profit Before Tax growth guidance to growth of 13% to 17% from FY24.
