Ann: Q3 FY24 Business Growth Update, page-5

Are we not men? We are DEVO. D E V O.

I've just skimmed it, but all looking good. This type of relationship with DEVO if duplicated could make this company a home run. This is the dream for software companies. "Here it is middleman, now upload it to all your customers and pay us, forever." It doesn't get much better than that.

Of course, as a practically-minded value investor, I always have to ask the question: Does the company make money? And, if not, why not? And when? To answer Mightyrivers question, how can the SP stay so low? I think the PR statement that they are going to be cash-flow positive FY24 but have an EBITDA loss is the answer. Cash flow is king and I understand that the company is growing, but this is a software company, which should have high margins and for it to still, after all this time, after all this steady increase in revenue, still not make a profit, is likely the reason investors aren't knocking down the door to buy it, especially given the company's decades of being an underperformer. With that said, it looks like they are on their way to profitability. First stop: cash-flow positive. Second stop: profitability. And as long as they keep ramping up revenue, it's all good.

I post here regularly and bought at .50 a few years ago and have threatened to sell because I haven't been impressed with their growth, given how small the numbers are. And to be clear, I'm still not impressed. Increasing rev 20%-30% when you are talking numbers this small is not impressive. Software companies at this stage that grew to be winners are doubling and tripling their revenue at this stage. However, I'm holding because I think this DEVO type of deal is a game-changer. They get a couple more of these within the next year and this company will be a "a relevant Australian software company" as Brad said quite a while ago when asked what number of rev it needed to get to be considered such. That number: 50m. And at that point, it should be profitable and sales beget sales and it will be a runner and a merger/acquisition target, especially once inflation chills.

Just my opinion. I'm often wrong.

Cheers fellow PRO holders!