Highlights

  • Fiscal 2026 revenue rose 12.5% to a company-described record of $74.4 million, above its $73 million guidance.
  • Operating income nearly doubled to $6.9 million, and GAAP net income attributable to NetSol was $2.95 million.
  • Operating cash flow reached $13.9 million versus $0.4 million, and year-end cash rose 56.3% to $27.1 million.
  • Fiscal 2027 guidance calls for 13% to 16% revenue growth, gross margin near 50% or better and higher adjusted EBITDA.

NetSol Technologies (NASDAQ:NTWK) shares were trading near their 52-week high at USD 6.91 on October 21, 2026, up 5.66%. The asset finance software provider reported fourth quarter and full-year fiscal 2026 results on September 28, topped its revenue guidance and issued fiscal 2027 guidance.

Based in Encino, California, NetSol is a Nevada corporation that dates its inception to 1997. It provides software and services for the asset finance and leasing industry, serving automotive and equipment manufacturers, auto captives and financial institutions in more than 30 countries. Its products include the Transcend platform for finance and digital retail. The fiscal year ends June 30, and the company employed about 1,370 people at June 30, 2026, compared with about 1,460 a year earlier.

Revenue Growth, Wider Margins and a Weak First Quarter

Revenue for the year ended June 30, 2026 was $74.4 million, up from $66.1 million. Subscription and support revenue grew 8.7% to $35.8 million, about 48% of the total. Services revenue rose 3.3% to $33.6 million, and license fees rose to $5.0 million from $0.6 million, including roughly $4.7 million from the renewal and amendment of an existing Transcend customer agreement. Gross profit was $39.1 million, a 52.6% margin versus 49.3%, and operating income was $6.9 million against $3.5 million.

GAAP net income attributable to NetSol was $2.95 million, or $0.25 per diluted share, roughly level with a year earlier. Consolidated net income rose 22.4% to $5.6 million, but net income attributable to non-controlling interests increased to $2.65 million from $1.65 million, and the year carried a $0.39 million foreign exchange loss versus a $1.30 million gain. Non-GAAP consolidated adjusted EBITDA was $9.15 million, up 68.8%.

The fourth quarter was the strongest. Revenue of $20.7 million, which the company called a quarterly record, rose 12.5%, gross margin was 63.6% versus 56.2%, operating income rose 40.2% to $4.5 million, and GAAP net income attributable to NetSol was $3.8 million, or $0.32 per diluted share. On the call, management said the first quarter was weaker, with revenue of about $15 million and a net loss attributable to NetSol of $2.4 million.

Cash, Customers and Contracted Revenue

Net cash from operating activities was $13.9 million, including about $6.5 million from advance billings recorded as contract liabilities. The company invested $2.0 million in property and equipment and $2.7 million in capitalized software. Cash was $27.1 million at June 30 versus $17.4 million, working capital was $29.2 million, and total debt and finance lease obligations were $8.4 million.

Remaining performance obligations were $49.1 million, of which about $22.5 million is expected to be recognized within 12 months. NetSol also began reporting contracted revenue, a non-GAAP measure, of approximately $60 million, and stressed that it is not backlog or a guaranteed floor. Management cited a $50 million contract extension with a tier-one global auto captive, a Transcend Finance go-live in China, a renewal with a U.K. bank and the move of BMO Equipment Finance to Transcend Finance. An efficiency program continues through fiscal 2027, which management described as a workforce review rather than a headcount-reduction exercise.

Fiscal 2027 Guidance and Priorities

For fiscal 2027, NetSol expects revenue growth of 13% to 16%, gross margin of about 50% or better, and consolidated adjusted EBITDA growth of 15% to 25%, or roughly $10.5 million to $11.4 million. The outlook assumes continued subscription growth, execution of contracted implementations, disciplined cost control and no material acquisitions. Risks it lists include contract timing, currency swings and customer concentration. These are company estimates.

Management's stated priorities are the Transcend platform, practical use of AI, selective partnerships and acquisitions, and evaluating structural options that could reduce the economic effect of minority interests over time.