A single lost contract has wiped a third off the value of the workforce-analytics software firm in a single session.
Shares in ActiveOps (AIM: AOM) collapsed by a third on Monday after the workforce-productivity software group warned that revenue and profit for its 2028 financial year would fall well short of City expectations, following news that a major customer will not renew a £3.8m contract due to expire in March 2027.
The stock was down 33% at the time of the announcement, as investors digested the scale of the hit: ActiveOps has stripped the full value of the contract out of its forward guidance as a precautionary measure, and flagged that a slower rate of new business wins in the first half would compound the shortfall by 2028.
The warning overshadowed what was otherwise a solid set of interim numbers. ActiveOps said first-half revenue climbed 21% to £25.3m, though stripping out a one-off termination receipt the underlying growth rate was a more modest 14%. The company ended the period with £19.6m of cash and no debt, and said it remained on track to meet its full-year targets for the current year.
ActiveOps provides 'decision intelligence' software that helps large service operations monitor and manage staff productivity, a market it argues is set to grow as businesses look to quantify efficiency gains from artificial intelligence. Executive chair Richard Jeffery described the lost contract as a setback rather than a structural problem, insisting the medium-term growth opportunity for the business remains intact.
Management said it would act on costs in response to the weaker outlook but intends to keep funding its growth investments rather than retrench. For now, though, the market's reaction suggests investors are more concerned with the near-term hole in revenue than with longer-term promises, and attention will turn to whether further customer losses emerge before the 2028 guidance can be rebuilt.
This report is based on ActiveOps’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full results calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Israel Andrade on Unsplash.
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