Published on: August 10, 2023

FY23 – strong revenue growth and margins

ZOO has announced FY23 results in line with the guidance given in the recent trading update. Increased market share and the scaling up of its international operations have delivered revenue growth of 28% to $90.3m (FY22: $70.4m), with good margin progress and profitability. ZOO’s key growth drivers remain intact, content budgets remain large and the focus by the key streaming players on monetisation models represents a material opportunity, underpinned by the roll-out of ZOO’s strategic geographic hubs. However, short-term trading has been affected by two temporary market issues: cost cutting among major streaming providers holding back order flows, and the ongoing industry-wide strikes impacting localisation and media services work on new titles. We maintain headline estimates for FY24, which we adjusted at the recent trading update to reflect the near-term headwinds. We also maintain our FY25 estimates, with revenue of $115m and adjusted EBITDA at $19m.