Toku reports higher FY2025 losses driven by IPO costs, sees commercial momentum ahead

[SINGAPORE] Artificial intelligence (AI)-powered customer experience platform Toku reported a 72.7 per cent increase in losses in FY2025 to US$9.1 million from US$5.3 million in the prior year.

The company, which listed on the Catalist board on Jan 22, reported a 9.3 per cent rise in FY2025 revenue to US$34.8 million from US$31.8 million in FY2024. This was mainly driven by higher revenue from the usage segment and continued platform adoption.

The usage segment revenue for FY2025 grew 21 per cent to US$23.9 million from US$19.8 million in the previous financial year, indicated a bourse filing on Sunday (Mar 1).

Toku also recognised the full-year contribution of its Latin American operations in FY2025, as well as expanded traffic from existing Asia-Pacific (Apac) customers.

The loss for FY2025 was due mainly to US$4.9 million of non-cash and one-off items recognised in the fourth quarter of the year. This comprised fair-value adjustments on redeemable convertible loans of US$400,000, listing costs of US$2.3 million, and accelerated share-based payments of US$3 million, partially offset by an income tax credit of US$800,000.

Toku has also paid off its shareholder loans in full, and is set to repay a venture debt facility early to retire its highest-cost borrowing facility.

“The key message for shareholders is that the capital restructuring is largely complete… We are therefore now operating with a clean IPO capital structure that supports our growth ambitions,” said Thomas Laboulle, founder and chief executive of Toku, in a briefing on Tuesday.

Positives seen

Since Toku is in the enterprise space where sales cycles take longer, its FY2025 financials largely reflect the company’s commercial activity in FY2024. There are some positives in the leading indicators from FY2025.

New business deal value expanded 12 per cent on the year, with average deal sizes 1.6 times compared with those in FY2024. The number of new customers also grew, with 16.7 per cent of the top 30 revenue contributors coming from new customers.

Conversions increased as well, with the close-won rate up from 6.4 per cent in FY2024 to 9.4 per cent in FY2025, and a 30 per cent growth in the value of annual recurring revenue won. The tender win rate also significantly improved to 23.9 per cent in FY2025 from 8.8 per cent in the previous year.

“Putting all those indicators together tell us that the commercial engine is strong and the financial results will follow,” noted Laboulle.

Looking ahead, Toku will be accelerating its AI-monetisation efforts to ensure that it becomes a meaningful contributor to revenue. This will be via developing its channel partner programme so as to support growth in the subscriptions and licensing segments.

With larger contract sizes, Toku has grown its brand awareness and experience, and Laboulle has seen this play out in the company’s international expansion.

“The fact that the complex and challenging regulatory environments are actually demanding and seeking solutions like ours that are adapted to them is something that we are all very excited about, and I think is going to be driving the year ahead,” he said.

Growth plans

Toku will also expand its footprint in Apac, Latin America and the Middle East and North Africa regions. Efforts will continue to build on the company’s early European presence, it added.

“We have capital allocated from the IPO (initial public offering) proceeds, and we are actively evaluating opportunities that can accelerate our growth and expand our platform capabilities,” noted Laboulle.

The AI drive will likely not inflate infrastructure costs for FY2026. As Laboulle pointed out, with Toku’s scale advantage, it was able to get better rates with a partner. A lot of infrastructure investments were also made prior to FY2025 and are in place to accommodate more customers.

The third version of the platform is also more efficient, which will lead to lower costs.

“On that front, we see that our first enterprise customers, or first government customers, are also going live with their AI contracts that we won last year,” said Laboulle.

Shares of Toku were trading down 7.7 per cent or S$0.02 at S$0.24 before the midday break on Tuesday.