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Research Solutions Reports Robust Fourth Quarter and Fiscal Year 2025 Performance

Financial Overview

On September 18, 2025, Research Solutions, Inc. (NASDAQ: RSSS) announced an impressive financial performance for its fourth quarter and the fiscal year ending June 30, 2025. The company, a leader in AI-driven research workflow solutions, showcased significant growth in its platform and total revenues.

Fourth Quarter Highlights

In the fourth quarter, Research Solutions experienced a 21% increase in platform revenue, totaling $5.2 million. This is part of an ongoing upward trend as the company works to expand its annual recurring revenue (ARR), which reached $20.9 million, reflecting a 20% year-over-year increase. The breakdown of this revenue includes approximately $14.2 million from B2B sources and $6.7 million from B2C.

Total revenue for the quarter was reported at $12.4 million, a slight increase of 3% compared to the preceding year’s quarter. Gross profit saw a notable increase as well, rising 12% and displaying a gross margin improvement of 450 basis points to 51%, the highest in the company’s history. Net income for the quarter stood at $2.4 million, marking a turnaround from the previous year’s loss.

Annual Financial Performance

For the full fiscal year, Research Solutions reported a remarkable 36% growth in platform revenue, reaching $19 million. Total revenues climbed to $49.1 million, a 10% year-over-year increase, alongside a gross profit rise of 23%, with a gross margin enhancement of 530 basis points to 49.3%. The net income for the fiscal year was $1.3 million, indicating a recovery from a net loss of $3.8 million the previous year.

Adjusted EBITDA also set a new record at $5.3 million, demonstrating significant operational efficiency improvements. Cash flow from operations reached an all-time high of $7 million, reinforcing the financial stability of the company, which ended the fiscal year with $12.2 million in cash and cash equivalents.

Strategic Growth Moves

Roy W. Olivier, President and CEO, attributed this success to a strategic focus on SaaS software and AI solutions, significantly boosting the contribution of the platform revenue to nearly 40% of total revenue, compared to 31% the previous year. The team’s proactive measures in adjusting the payout structure related to the Scite acquisition were also a key factor, optimizing cash distribution and minimizing shareholder dilution.

Furthermore, the growth of the AI-based Scite product, exceeding 40%, hints at the company’s positive trajectory in the AI domain.

Conclusion

Research Solutions continues to solidify its position in the research workflow landscape by enhancing its AI capabilities and pursuing further growth opportunities. The results for fiscal 2025 reflect a successful transition towards a model that emphasizes recurring revenue, setting a strong foundation for sustainable development as they aim to achieve their 'Rule of 40' goal center-stage.

The potential for long-term value creation for shareholders remains a key focus as the company adapts to evolving market demands and leverages its technological advancements in AI to stay competitive in the research landscape.