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Company executes on initiatives to drive success with managed service providers, including the launch of the Martello Partner Network and Vantage DX multitenancy.

The Martello Partner Network launch has simplified the onboarding of Martello partners, with training, documentation, product demos and marketing materials. Appointment of IT managed services leader Michael Contento to the Martello board of directors in Q3 FY25 brings unique perspective as this channel develops.Extensive consultation with MSPs in H1 FY25 led to the launch of multitenancy in Vantage DX in Q3 FY25, aligning the solution with MSP business models.Multi-vendor experience management solutions are increasingly attractive to telephony and unified communications partners seeking to extend revenue opportunities, improve profitability and boost customer retention. Martello’s multi-vendor experience management strategy includes Zoom monitoring capabilities in FY26.Martello continues to develop features in Vantage DX that support Microsoft Teams premium services, which are used by more than 75% of Teams Enterprise customers. Martello completed the next step in its commitment to industry-standard data security and privacy with SOC 2 Type 2.The Mitel channel represents a growth opportunity, as it remains a large source of margin and revenue in which Martello continues to invest.

OTTAWA, ON, Feb. 13, 2025 /CNW/ – Martello Technologies Group Inc., (“Martello” or the “Company”) (TSXV: MTLO), a provider of user experience management solutions for cloud communication and collaboration systems such as Microsoft Teams and Microsoft 365, today released financial results for the three and nine months ended December 31, 2024. Martello’s software proactively detects performance issues before they impact users of these systems.

Terence Matthews, Chairman of Martello shared his perspective on experience management for Mitel partners and telcos: “Channel partners are operating in a highly competitive market, where differentiation and high-quality services are critical to revenue growth and customer acquisition,” said Mr. Matthews. “The solutions offered by Martello help them deliver superior service quality to win and retain customers, while improving their own operational efficiency and bottom line.”

“Martello is reallocating resources to strengthen the MSP channel, refining our product innovation strategy and optimizing our marketing approach”, said Jim Clark, Chief Executive Officer of Martello. “As we learn more by working with MSPs, we continue to evolve Vantage DX to help these partners grow. I’m pleased that Vantage DX multitenancy was launched in Q3 FY25, and the launch of Teams Phone Proactive Monitoring in Q4 FY5 addresses demand for management tools for this high-value Teams premium service. In addition, our multi-vendor digital experience management roadmap now includes Zoom capabilities.”

Q3 FY25 Financial Highlights

Revenue in Q3 FY25 was $3.72M, representing a 7% decrease compared to Q3 FY24, due to expected declines in legacy product and support and maintenance revenue, partially offset by growth in Vantage DX revenue.Vantage DX monthly recurring revenue (“MRR”) increased by 5% in Q3 FY25 compared to Q3 FY24, both from direct and partner sales. Vantage DX has contributed $1.93M in revenue in FY25 to date, an 8% increase compared to the same period in FY24.Sunsetting legacy product revenue declined by 13% or $0.20M in Q3 FY25 compared to Q3 FY24. The ongoing decline of legacy product revenue is proceeding as expected.Revenue from the Mitel business segment decreased by 5% in Q3 FY25 compared to the same period in the prior year. This decrease is attributable to a revenue mix change from various Mitel Performance Analytics offerings. The Mitel business represents a growth opportunity as it continues to be a large source of revenue and gross margin, representing 45% of total revenues in Q3 FY25 (compared to 44% in Q3 FY24) and 97% gross margin as a percentage of segment revenue.98% of total revenues were recurring in Q3 FY25 and the comparative period.Gross margin as a percentage of total revenue was 86% in Q3 FY25, compared to 88% in Q3 FY24. The decrease is attributable to higher cloud hosting and delivery costs. Management continues to execute a strategy to reduce hosting costs.Monthly recurring revenue (“MRR”) decreased by 7% to $1.22M in Q3 FY25 compared to $1.30M in the prior year. The decrease is primarily attributable to expected declines in sunsetting legacy product revenue and changes in the mix of users subscribed to certain Mitel offerings.Operating expenses decreased by 5% to $4.18M in Q3 FY25, compared to $4.41M in Q3 FY24. The decrease is attributed to lower headcount and marketing event costs. The Company continues to invest in Vantage DX revenue growth as management monitors value for spend in all functions of the value chain.The Q3 FY25 loss from operations of $0.99M represented an 8% increase compared to $0.91M in Q3 FY24, due to the decrease in revenue as described above, partially offset by lower operating expenses.The Adjusted EBITDA (a non-IFRS measure) was a loss of $0.43M in Q3 FY25, compared to $0.40M in the same period of FY24, attributable to the items described above.The Company’s cash and short-term investments balance was $5.06M as of December 31, 2024 (compared to $7.72M at March 31, 2024).

The financial statements, notes and Management Discussion and Analysis (“MD&A”) are available under the Company’s profile on SEDAR+ at www.sedarplus.ca, and on Martello’s website at www.martellotech.com. The financial statements include the wholly-owned subsidiaries of Martello. All amounts are reported in Canadian dollars. MRR is a non-IFRS measure, representing average monthly recurring revenues earned in a fiscal quarter. 

This press release does not constitute an offer of the securities of the Company for sale in the United States. The securities of the Company have not been registered under the United States Securities Act of 1933, (the “1933 Act”) as amended, and may not be offered or sold within the United States absent registration or an exemption from registration under the 1933 Act.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

About Martello Technologies Group

Martello (TSXV: MTLO) is a technology company that provides digital experience management solutions for Microsoft Teams and Mitel unified communications. The Company’s Vantage DX solution enables IT teams to deliver a frictionless Microsoft Teams experience to their users. With Vantage DX, IT can move from reactive to proactive by detecting potential performance issues before they impact users, and speeding resolution time from days to minutes.  This leads to increased productivity, realizes efficiencies, and allows businesses to harness the full value of Microsoft Teams. Martello is a public company headquartered in Ottawa, Canada with employees in Europe, North America and the Asia Pacific region.  Learn more at http://www.martellotech.com

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Information

This news release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods and ” includes, but is not limited to, statements with respect to activities, events or developments that the Company expects or anticipates will or may occur in the future, including the expectation that the Company’s multi-vendor experience management strategy will include Zoom capabilities in FY26, management’s aim to reduce hosting costs.

Forward-looking information is neither a statement of historical fact nor assurance of future performance. Instead, forward-looking information is based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking information relates to the future, such statements are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking information. Therefore, you should not rely on any of the forward-looking information. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking information include, among others, the following:

Continued volatility in the capital or credit markets and the uncertainty of additional financing.Our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so.Changes in customer demand.Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures or equipment.Delayed purchase timelines and disruptions to customer budgets, as well as Martello’s ability to maintain business continuity as a result of COVID-19.and other risks disclosed in the Company’s filings with Canadian Securities Regulators, including the Company’s annual information form for the year ended March 31, 2021 dated January 7, 2022, which is available on the Company’s profile on SEDAR at www.sedar.com.

Any forward-looking information provided by the Company in this news release is based only on information currently available and speaks only as of the date on which it is made. Except as required by applicable securities laws, we undertake no obligation to publicly update any forward-looking information, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise. 

SOURCE Martello Technologies Group Inc.