Reports 36% YoY Platform Revenue Increase, ARR of $20.9 Million and Record Fiscal Year Net Income and Adjusted EBITDA
HENDERSON, Nev., Sept. 18, 2025 /PRNewswire/ -- Research Solutions, Inc. (NASDAQ: RSSS), the leading AI-powered research workflow platform, reported financial results for its fourth quarter and full fiscal year ended June 30, 2025.
Fiscal Fourth Quarter 2025 Summary (compared to prior-year quarter)
Platform revenue up 21% to $5.2 million. Annual Recurring Revenue ("ARR") up 20% to $20.9 million, which includes approximately $14.2 million of B2B recurring revenue and $6.7 million of B2C recurring revenue.Total revenue of $12.4 million, a 3% increase.Gross profit up 12%. Total gross margin improved 450 basis points to 51%, crossing 50% on a blended basis for the first time in the Company's history.Net income of $2.4 million, or $0.07 per diluted share, compared to net loss of $2.8 million or ($0.09) per share. This quarter's result includes a $1.1 million favorable adjustment related to the final earnout adjustment for Scite. Last year's result included a negative adjustment charge in other expense of approximately $4.3 million related to the projected earnout for Scite.Adjusted EBITDA increased 15% to a Company record of $1.6 million.Cash flow from operations of $2.3 million, compared to $2.0 million.
Fiscal Year 2025 Summary (compared to Fiscal 2024)
Platform revenue up 36% to $19.0 million.Total revenue of $49.1 million, a 10% increase.Gross profit up 23%. Total gross margin improved 530 basis points to 49.3%.Net income of $1.3 million, or $0.04 per diluted share, compared to a net loss of $3.8 million, or ($0.13) per share. This year's result includes $1.7 million of net other expense related to the Scite earn-out compared to $5.1 million of net other expense related to the Scite earnout in fiscal 2024.Adjusted EBITDA of $5.3 million, a Company record, compared to $2.2 million.Cash flow from operations of $7.0 million, a Company record, compared to $3.6 million. The Company ended the fiscal year with $12.2 million in cash and cash equivalents.
"Fiscal 2025 reflects a year of significant progress in our ongoing SaaS software and AI solution set transition, with our platform revenue now representing nearly 40% of total revenue for the year compared to 31% in fiscal 2024. As expected, this strategic shift and continued focus on recurring revenue has also translated into meaningful increases in gross margin, Adjusted EBITDA and operating cash flow," said Roy W. Olivier, President and CEO of Research Solutions. "Following the final earnout calculation for Scite, we proactively adjusted the payout structure, offering more cash and reducing dilution to current shareholders. We remain focused on improving on our 'Rule of 40' goal, with a slight bias towards increased growth versus profitability, which in turn should create long-term value for our shareholders. In addition, we used the Scite acquisition to help build out the AI capabilities in our product set and we continue to actively pursue additional opportunities that enhance, complement and strengthen our current product offerings. The growth rate of our AI-based Scite product is over 40%, which I view as a good indication that we are on the right track. Lastly, from a cash and Adjusted EBITDA perspective, we are better positioned than we ever have been to execute on these opportunities."
Fiscal Fourth Quarter 2025 Results
Total revenue was $12.4 million, compared to $12.1 million in the year-ago quarter driven by increased platform revenue versus the prior-year period.
Platform subscription revenue for the quarter was $5.2 million, a 21% year-over-year increase from the prior-year period. The increase was due to organic growth in the core B2C and B2B platforms, with the latter increasing due to a mix of new logo generation and upsell and cross sell into existing customers. The quarter ended with annual recurring revenue of $20.9 million, up 20% year-over-year (see the Company's definition of annual recurring revenue below).
Transaction revenue was $7.3 million, compared to $7.9 million in the fourth quarter of fiscal 2024. The decrease was due to lower paid order volume. The transaction active customer count for the quarter was 1,338, compared to 1,398 customers in the prior-year quarter (see the Company's definition of active customer accounts and transactions below).
Total gross margin improved 450 basis points from the prior-year quarter to 51.0%. The increase was primarily driven by the continued revenue mix shift to the higher-margin Platforms business, including the expansion of the gross margin for that business.
Total operating expenses were $5.1 million, compared to $5.0 million in the fourth quarter of 2024. The increase was primarily related to higher sales and marketing expenses offset by reduced stock compensation expense.
Other income for the quarter was approximately $1.2 million compared to other expense of approximately $3.5 million in the fourth quarter of fiscal 2024. This quarter's result includes a $1.1 million favorable adjustment related to the final determination of the Scite earnout. Last year's result included a negative adjustment in other expense of approximately $4.3 million related to the projected earnout for Scite.
Net income in the fourth quarter was $2.4 million, or $0.07 per diluted share, compared to net loss of $2.8 million, or ($0.09) per share, in the prior-year quarter. Adjusted EBITDA was $1.6 million, compared to $1.4 million in the year-ago quarter (see definition and further discussion about the presentation of Adjusted EBITDA, a non-GAAP term, below).
Full-Year Fiscal 2025 Results
Total revenue was $49.1 million, a 10% increase from fiscal 2024, driven by increased platform revenue.
Platform subscription revenue for fiscal 2025 was $19.0 million, a 36% year-over-year increase. The increase was primarily due to organic growth in the core B2C and B2B platforms, including 150 net new B2B platform deployments, as well as having a full fiscal year of Scite revenue (versus seven months in fiscal 2024).
Transaction revenue was $30.1 million, compared to $30.7 million in fiscal 2024. The decrease was due to lower paid order volume in the second half of fiscal 2025.
Total gross margin improved 530 basis points from the prior-year to 49.3%. The increase was primarily driven by the continued revenue mix shift to the higher-margin Platforms business.
Total operating expenses for the year were $21.7 million, compared to $20.4 million in fiscal 2024. The increase was primarily related to higher sales and marketing expenses offset by reduced general and administrative and stock compensation expenses.
Net income for fiscal 2025 was $1.3 million, or $0.04 per diluted share, compared to net loss of $3.8 million, or ($0.13) per share, in the prior year. Adjusted EBITDA was $5.3 million, compared to $2.2 million in fiscal 2024 (see definition and further discussion about the presentation of Adjusted EBITDA, a non-GAAP term, below).
Conference Call
Research Solutions President and CEO Roy W. Olivier and CFO Bill Nurthen will host the conference call, followed by a question and answer period.
Date: Thursday, September 18, 2025
Time: 5:00 p.m. ET (2:00 p.m. PT)
Dial-in number: 1-203-518-9783
Conference ID: RESEARCH
The conference call will be broadcast live and available for replay until October 18, 2025 by dialing 1-412-317-6671 and using the replay ID 11159860, and via the investor relations section of the Company's website at http://researchsolutions.investorroom.com/.
Fiscal Fourth Quarter Financial and Operational Summary Tables vs. Prior-Year Quarter
Quarter Ended June 30,
Twelve Months Ended June 30,
2025
2024
Change
% Change
2025
2024
Change
% Change
Revenue:
Platforms
$ 5,184,864
$ 4,277,338
$ 907,526
21.2 %
$ 18,955,695
$ 13,956,517
$ 4,999,178
35.8 %
Transactions
$ 7,253,053
$ 7,856,176
(603,123)
-7.7 %
$ 30,102,286
$ 30,667,382
(565,096)
-1.8 %
Total Revenue
12,437,917
12,133,514
304,403
2.5 %
49,057,981
44,623,899
4,434,082
9.9 %
Gross Profit:
Platforms
4,590,639
3,650,286
940,353
25.8 %
16,584,155
11,889,314
4,694,841
39.5 %
Transactions
1,751,263
1,992,580
(241,317)
-12.1 %
7,611,796
7,750,852
(139,056)
-1.8 %
Total Gross Profit
6,341,902
5,642,866
699,036
12.4 %
24,195,951
19,640,166
4,555,785
23.2 %
Gross profit as a % of revenue:
Platforms
88.5 %
85.3 %
3.2 %
87.5 %
85.2 %
2.3 %
Transactions
24.1 %
25.4 %
-1.2 %
25.3 %
25.3 %
0.0 %
Total Gross Profit
51.0 %
46.5 %
4.5 %
49.3 %
44.0 %
5.3 %
Operating Expenses:
Sales and marketing
1,219,184
830,195
388,989
46.9 %
5,360,356
3,442,503
1,917,853
55.7 %
Technology and product development
1,356,801
1,489,491
(132,690)
-8.9 %
5,631,344
5,442,382
188,962
3.5 %
General and administrative
2,152,855
1,917,907
234,948
12.3 %
7,936,644
8,511,697
(575,053)
-6.8 %
Depreciation and amortization
315,021
311,004
4,017
1.3 %
1,245,362
836,271
409,091
48.9 %
Stock-based compensation
176,611
426,190
(249,579)
-58.6 %
1,723,561
2,155,461
(431,900)
-20.0 %
Foreign currency translation loss (gain)
(83,322)
6,336
(89,658)
NM
(202,527)
21,395
(223,922)
NM
Total Operating Expenses
5,137,150
4,981,123
156,027
3.1 %
21,694,740
20,409,709
1,285,031
6.3 %
Income (loss) from operations
1,204,752
661,743
543,009
82.1 %
2,501,211
(769,543)
3,270,754
NM
Other Income (Expenses):
Other income (expenses)
1,163,557
(3,451,948)
4,615,505
NM
(1,152,847)
(2,903,983)
1,751,136
NM
Provision for income taxes
(7,995)
(31,022)
23,027
-74.2 %
(82,811)
(113,071)
30,260
-26.8 %
Total Other Income (Expenses):
1,155,562
(3,482,970)
4,638,532
NM
(1,235,658)
(3,017,054)
1,781,396
NM
Net income (loss)
$ 2,360,314
$ (2,821,227)
5,181,541
NM
$ 1,265,553
$ (3,786,597)
5,052,150
NM
NM
Adjusted EBITDA
$ 1,613,062
$ 1,405,273
$ 207,789
14.8 %
$ 5,267,607
$ 2,243,584
$ 3,024,023
134.8 %
Quarter Ended June 30,
Twelve Months Ended June 30,
2025
2024
Change
% Change
2025
2024
Change
% Change
Platforms:
B2B ARR (Annual recurring revenue*):
Beginning of Period
$ 13,474,074
$ 11,653,062
$ 1,821,012
15.6 %
$ 12,060,201
$ 9,444,129
$ 2,616,072
27.7 %
Incremental ARR
723,524
407,139
316,385
77.7 %
2,137,397
2,616,072
(478,675)
-18.3 %
End of Period
$ 14,197,598
$ 12,060,201
$ 2,137,397
17.7 %
$ 14,197,598
$ 12,060,201
$ 2,137,397
17.7 %
Deployments:
Beginning of Period
1,133
983
150
15.3 %
1,021
835
186
22.3 %
Incremental Deployments
38
38
-
0.0 %
150
186
(36)
-19.4 %
End of Period
1,171
1,021
150
14.7 %
1,171
1,021
150
14.7 %
ASP (Average sales price):
Beginning of Period