Sylogist (SYZ) Q2 2026 earnings summary

Executive summary

• SaaS subscription revenue grew 5.4% year-over-year to $8.3 million, with SaaS ARR up 6%, but total revenue declined 6.5% to $14.7 million due to lower project services and hardware revenue.

• Adjusted EBITDA margin improved sequentially to 10.8% ($1.6 million), but was down from 15.3% in Q2 last year; excluding capitalized R&D, last year's margin was 10.9%.

• Recurring revenue represented 76% of total revenue, up from 70% last year, with SaaS revenue making up 74% of recurring revenue.

• Net loss for the quarter was $2.8 million, impacted by shareholder engagement costs and severance accruals.

• Project services revenue declined 20% year-over-year, with associated gross margin falling to 8%.

Financial highlights

• SaaS ARR increased 6% year-over-year to $33.5 million; total ARR rose 3% to $45.0 million.

• Q2 total revenue was $14.7 million, down from $15.7 million year-over-year.

• SaaS revenue grew 5% year-over-year, with segment growth: Solution +17%, Gov +14%, Ed +6%, Mission -3%.

• Maintenance and support revenue declined 6% year-over-year, mainly in Mission and Gov segments.

• Cash balance at Q2 end was CAD 2.5 million, rising to approximately CAD 9 million post-quarter.

Outlook and guidance

• Priorities for the remainder of fiscal 2026 include improving execution, strengthening the product portfolio, investing in customer experience, and operating with discipline.

• Focus remains on aligning cost structure and resources to drive sustainable recurring revenue growth and profitability.

• Management aims for sustainable long-term growth and increasing shareholder value.