The Technology One Ltd (ASX: TNE) share price is in focus after Australia's largest SaaS ERP company delivered its 17th consecutive record first-half profit, with annual recurring revenue (ARR) jumping 17% and profit before tax up 9% for the half year ended 31 March 2026.
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What did Technology One report?
- Profit before tax of $89.1 million, up 9% year-on-year
- Profit after tax of $66.8 million, up 6%
- Annual recurring revenue (ARR) of $598.0 million, up 17%
- Net revenue retention of 114%
- Record interim dividend of 8.0 cents per share, up 21%
- SaaS and recurring revenue of $299.2 million, up 13%
What else do investors need to know?
Technology One's results reflect the strong momentum behind its SaaS+ strategy and recently launched AI products. The company saw significant growth in the UK (ARR up 23%) and strong wins across local government and education sectors, including major contracts with prominent Australian councils and universities.
Investment in research and development (R&D) increased 22% to $84.1 million, representing 26% of total income, as Technology One continues to innovate in AI and expand its product suite. Cash and investments rose 16% to $245.5 million, underpinning the company's ongoing investment capability with no debt on the balance sheet.
What did Technology One management say?
Technology One CEO and Managing Director Ed Chung said:
There is huge momentum and confidence in the business today, in our strategy of SaaS+, which is fuelling the results we delivered today, and allows us to continue to invest into the future. Now with our AI strategy, the adoption of AI and the feedback we are receiving is surpassing our expectations. All of this also gives us confidence in our pipeline and we don't guide up unless we see it day in and day out.
What's next for Technology One?
The company reaffirmed upgraded FY26 guidance, targeting 18–20% profit growth and 16–18% ARR growth for the full year, with a goal of $1 billion+ ARR by FY30. Management confirmed guidance includes all current investments, such as AI, SaaS+ and new initiatives like Showcase.
With its transition to SaaS+ and continued rollout of next-generation AI ERP products, Technology One expects improved margins and sustained double-digit growth, focusing on expanding in both domestic and overseas markets, particularly local government and higher education.
Technology One share price snapshot
Over the past 12 months, Technology One shares have declined 13%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 3% over the same period.
