Research Solutions Stock Earnings Reports

Research Solutions reported solid Q1 FY2026 results highlighted by strong B2B performance and platform growth. Total revenue was $12.3M (vs. $12.0M prior year). ARR rose 21% year-over-year to $21.3M, driven by B2B ARR strength (approximately $14.8M B2B; $6.5M normalized Scite B2C). Platform subscription revenue increased 18% to $5.1M, and platform gross margin expanded to 88.1%, helping blended gross margin improve to 50.6%. Transaction revenue declined modestly to $7.2M, consistent with guidance, with a concentrated decline driven largely by three corporate customers. Adjusted EBITDA was $1.5M, a 16% increase and the company’s second-best quarterly adjusted EBITDA on record. Cash was $12.0M at quarter end after the first Scite earnout payment ($1.3M cash + ~265k shares); operating cash flow improved to $1.1M. Management is focused on (1) improving Scite B2C net ARR conversion and product enhancements, (2) continuing ARR and ASP growth via better sales execution, (3) improving retention and upsell through proactive engagement and health scoring, (4) innovating on AI rights/transaction offerings, and (5) managing costs to progress toward a weighted Rule of 40. They expect Q2 seasonality (historical dip) but believe it may be less pronounced; Q3–Q4 are typically strongest. Management also emphasized strategic AI initiatives (AI rights via Article Galaxy, an AI gateway with publishers, and AI usage metrics) as potential new revenue streams and deeper publisher partnerships. M&A pipeline is active but nothing expected to close this year.