We are pleased to bring you our FY25 half-year results, showcasing our strongest half-year result to date.
Key Highlights
- XRG had its strongest half-year result to date, with Total Revenue exceeding $7.4m (up 32% on pcp) and NLAT improving to $1.0m from NLAT of $1.5m in pcp.
- Operator XR revenue was $2.1m, (up $1.8m on pcp) with strong momentum expected to continue throughout FY25.
- Annual Recurring Revenue from Operator XR has grown 60% from June 2024 to $3.6m
- Board and management have resolved and streamlined the business to focus on Operator XR.
xReality Group: Leading the Future of Immersive Training & Entertainment
At xReality Group (XRG), we are committed to pushing the boundaries of Extended Reality (XR) technology, delivering cutting-edge VR and AR solutions across military and law enforcement training, as well as immersive entertainment experiences.
Over the past six months, we have made significant strides in expanding our presence, particularly in the U.S. market, strengthening our Operator XR division, and refining our strategic focus to maximize shareholder value.
Operator XR: Transforming Military & Law Enforcement Training
Our Operator XR business is at the forefront of immersive training, providing military and law enforcement agencies with a secure, portable, and highly immersive Mission Planning & Rehearsal System. Since the end of FY2024, we have secured 21 new customers, reinforcing our momentum in the U.S.
As of 31 December 2024, we are proud to report:
- Total Contract Value (TCV) of $7.4 million, an 80% increase on entire FY2024
- Annual Recurring Revenue (ARR) of $3.6 million
- Expansion to 51 customers (up to end of Feb’25) across 30 U.S. federal, state, and local law enforcement agencies
Beyond the U.S., we are accelerating global expansion, having formally engaged distributors in Europe and Asia. Most recently, we secured an exclusive distributor in Sweden, opening doors to the European market.
A major highlight was the launch of OP-2 in November 2024, our most advanced software release yet. OP-2 introduces the “Scenario Creator Suite,” empowering agencies to design their own immersive training environments. LAPD SWAT and the FBI are already leveraging this upgrade, with all customers expected to transition by Q3 2025.
Financial Performance: Strong Growth & Strategic Expansion
We are excited to share significant financial progress for the half-year ending 31 December 2024:
- Total Revenue: $7.4M (up 32% on pcp)
- Closing Cash Position: $1.7M (up 24% from June 2024)
- EBITDA: $0.9M (up 96% year-on-year)
- Deferred Revenue: $5.8M
This growth is driven primarily by Operator XR, which contributed $2.1M in recognised revenue. Additionally, we received our annual R&D Grant of $1.125M and an inventory adjustment of $313K.
Our strong EBITDA growth (96%) reflects strategic investments in U.S. sales, customer service, and marketing, positioning us for continued expansion.
Entertainment: Stability Amid Strategic Realignment
XRG is reviewing its strategic options for its iFLY assets with its corporate advisors, there is no certainty on direction or timing of this process in its early stages.
The exit of FREAK will be complete by 30 June 2025, with all transition steps being worked through.
iFLY continues to deliver strong cash flow and customer engagement, while we assess its long-term potential in alignment with our core growth strategy.
Strategic Focus: Operator XR as the Core Growth Asset
Looking ahead, we recognise the massive growth potential of Operator XR and are actively transitioning XRG into a high-margin, technology-driven enterprise:
- Operator XR’s revenue growth is far outpacing our legacy entertainment segment
- We are streamlining entertainment operations to improve focus and profitability
- Our goal is to establish XRG as a global leader in mission-critical simulation solutions
In line with our forward-thinking vision, we have welcomed Ash Crick, a globally recognised Artificial Intelligence (AI) expert, as our Chief AI Advisor. Ash will play a pivotal role in driving innovation across our product suite, with a particular focus on enhancing Operator XR’s immersive training simulations.
Outlook for H2-FY25
With a strong cash position, an expanding customer base, and accelerating momentum in the U.S., we are well-positioned for continued growth in 2H2025 and beyond.
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