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James Pearson
Micro fund manager Raiz Invest has ticked off a key operating milestone, posting a profit for the first time in the first half of any financial year, as strong revenue growth, rising margins and disciplined cost control pushed the business deeper into the black in the December 2025 half year.
Statutory net profit after tax for the six months to December reached $3.52 million, lifted by the recognition of $2.68 million in deferred tax assets as management assessed past losses are now likely to be recovered. Stripping that out, the business still delivered a healthy underlying net profit of $836,000.
Although Raiz runs a traditional investment fund, the way it fills the tank is unmistakably modern. Its app rounds up everyday credit card purchases – from coffees to cab fares – and channels the spare change straight into an investment portfolio, quietly compounding customer wealth in micro increments.
The company delivered revenues of $14.4 million, up a solid 23.9 per cent on the prior corresponding period, as the platform continued to attract new users. A key contributor to the revenue lift was a 26.3 per cent jump in maintenance fees to $9 million, reflecting a price increase in August last year.
‘Raiz has now transitioned into structural profitability, a major operating milestone.’
Raiz Invest managing director and chief executive officer Brendan Malone
Notably, annualised revenues per user (ARPU) also lifted a hefty 16.4 per cent compared with the previous corresponding period, suggesting customers are becoming increasingly embedded in Raiz’s product offering.
Underlying EBITDA surged 270 per cent to $2.6 million for the half year, highlighting the operational leverage now flowing through the business as revenue growth comfortably outpaced cost increases. Operating cash flows followed suit, rising more than 50 per cent to $2.36 million and delivering free cash flows of just over $1 million for the half.
The growth was underpinned by a steady expansion in Raiz’s user base, with active customers climbing 5.7 per cent to more than 336,000.
Meanwhile, funds under management swelled 28.5 per cent to $2.1 billion compared to the first half of 2025, driven by strong net inflows of $138 million and supportive market conditions.
Superannuation, Plus and Kids portfolios – three of the company’s core products – all delivered standout growth of 17.4 per cent, 33.8 per cent and 29.2 per cent, respectively.
Raiz Invest managing director and chief executive officer Brendan Malone said: “Raiz has a highly scalable platform and the business has now transitioned into structural profitability, a major operating milestone. We now have multiple levers for growth, including new customer acquisition as well as increasing ARPU through new product development, strong engagement, higher retention and deeper relationships across our existing customer base.
On the cost side, operating expenses rose a modest 8 per cent to $11.8 million, despite continued investment in product development, technology, compliance and data capability. Marketing costs actually fell sharply following the end of a non-cash advertising arrangement with a major media company, helping to preserve margins.
The balance sheet remains healthy too, with Raiz closing out the period with nearly $14 million in cash and no debt, providing ample flexibility to pursue growth initiatives.
Looking ahead, Raiz says it has lined up a busy 2026 pipeline, focusing on more user engagement to lift ARPU and bolting on new transaction-based revenues to its subscription model. On the cards are direct access to US stocks, single-HIN ASX trading and instant payments, giving customers more control and flexibility while opening up fresh earnings levers as the platform continues to scale.
Buoyed by the first-half result, management says it is sticking with its FY26 underlying EBITDA forecast of $4.5 million to $5.5 million, while continuing to assess targeted M&A opportunities that could deliver strategic synergies and long-term value.
With a maiden first-half profit now locked in, improving cash generation and multiple growth levers still to pull, Raiz’s latest results appear to signal that its long-awaited transition from fintech disruptor to sustainably profitable wealth platform is underway.
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