Thank you. Good morning and welcome to Superloop's FY 2025 Full-Year Results Briefing. My name is Paul Tyler. I'm the CEO of Superloop, and I'm joined here by Dean Tognella, our CFO. We're incredibly proud of the results that we're going to take you through today, and I'm delighted that they once again show that our simplified business and low-cost operating model continue to drive market share gains, as well as revenue and earnings expansion. A particular highlight for FY 2025 has been the achievement of a positive net profit after tax result, our first since the commencement of our turnaround, and achieved a year before anticipated in our three-year double-down plan. With that, let's get into it. If you would turn to slide 4, please. FY 2025 brought an exceptionally strong financial performance across the board.
By the end of the year, our total customers had increased some 60% to over 731,000 customers. Revenue for the year increased 31% to AUD 546 million, and it's clear that our operating leverage is continuing, with EBITDA margins expanding and underlying EBITDA growing at a much faster rate than revenue. Underlying EBITDA was up 70% year-on-year and ended at AUD 92.2 million. As mentioned, this has resulted in a positive NPAT of AUD 1.2 million and improvement of some AUD 16 million on FY 2024. Our current three-year strategy set a positive NPAT target by the end of FY 2026, which we have now delivered some 12 months ahead of schedule, as mentioned. We also generated a gross operating cash flow of AUD 88 million for the year, representing a 95% conversion of underlying EBITDA to operating cash. A very incredible result. Moving to slide 5.
Looking now in a little more detail across the group, we had a packed year of highlights. We achieved record end-to-end market share, increasing by some 75%. In total, we added around 275,000 new customers. In the consumer segment, revenue increased 37%, both through ARPU expansion and the addition of 63,000 new customers in the segment. In the business segment, new wins and volume gains enabled us to maintain revenue and margin position, and we are now seeing some signs of improving market conditions. Pleasingly, we exceeded our sales target in smart communities, signing a record 18,000 new lots, and with 17,000 of those being fiber to the premise or FTTP. Finally, in the wholesale segment, the contract with Origin continues to deliver great results. Driving record growth in revenue and customers, we successfully migrated 130,000 Origin broadband customers to Superloop during the year.
Since the migration, a further 83,000 new Origin broadband customers have joined our network by the end of the year. Through enabling challenger retail service providers such as Origin, we continue to grow wholesale, with revenue up 62% on the prior year. Group underlying EBITDA margin, sorry, expanded, increasing from 13% in the prior year to 16.9% in FY 2025. We move on to slide 6. As you can see, we had record customer growth for the year, up 60% on the prior year, driving revenue up 31% to AUD 546 million, largely attributable to the exceptional market share gains in our consumer and wholesale segments. Over five years of consistent subscriber growth, we now have over 730,000 customers on our network. The next slide, slide 7, you can see that, pleasingly, this trend of consistent customer growth has not come at the expense of margin.
As you can see on the charts here, we've also demonstrated a trend of both profit expansion and consistent margin growth over that same period. In slide 8, you can see the group revenue of AUD 546 million was up 31% on FY 2024. Consumer revenue increased 37% to AUD 364 million, both from ARPU expansion and strong volume growth, with our consumer market share up 24% over the 12-month period. Despite sector headwinds, revenue from the business segment of AUD 105 million was slightly up versus last year. We won a number of great contracts in the smart communities division, which I'll talk about more later in this presentation. The wholesale segment delivered a record year with revenue growth of 62% to AUD 78 million, with growth dominated by the company's contract win with Origin, in addition to new revenue streams from AGL, amongst others. Moving on to the operational update and slide 10.
The strong revenue growth is being driven by increased network utilization across the platform. This significant investment that we've made in physical and digital assets enables us to deliver our services at a lower cost and we're now benefiting from operating leverage as our business grows. We have a great domestic and international fiber network, a modern integrated digital stack, and a global resource base. On slide 11, you can see a simple representation of that substantial asset base. The Uecomm acquisition completed during the year has extended our infrastructure reach and cements our position as an owner of domestic and international telecommunications infrastructure. The assets are particularly well-aligned with our smart communities division, and we see this infrastructure ownership conferring an advantage on us, both in differentiating our offering for customers and in reducing the CapEx requirements of that delivery. We move forward to slide 12.
You can see that in the year to 31st of March, Superloop added over 250,000 new services, representing an additional 2.8% of the market. In total, Superloop then had a 6.6% share of the NBN market. Through our retail and wholesale offerings, we ranked number one on NBN net adds across the 12 months to 31st of March 2025, being the latest period with publicly available data. The challengers in the broadband space continue to increase their share at the expense of older legacy brands, and as of March 2025, collectively, we had 21.2% of the market. We believe this multi-year trend has plenty of runway left and now see our long-term vision of the challengers as a group reaching 30% as somewhat understated. We are incredibly well-positioned to benefit from this trend through our offerings. If you'd move to slide 13, please.
As distinct from the NBN subscribers in the previous chart, Superloop acquired 275,000 total new customers in FY 2025 and now services a total of 731,000 customers on our network. 63,000 of those customers were added in the consumer segment. In the chart, you can see that adds in the second half were slower than in the first half. This was a deliberate consequence of decisions we made with short-term impacts that set us up to take advantage of the market changes in the first half of FY 2026. These decisions, including pausing the marketing of the Exetel brand ahead of the relaunch of the new Exetel One proposition launched at the start of July, which I note has been exceptionally successful to date. I'll talk more about that shortly. We were also an early mover in repricing our plans ahead of the NBN price increases in July.
This brought forward the usual attrition in the customer base. The rest of the market has clearly now implemented these changes as well, and with that, churn has normalized and momentum in FY 2026 is very strong, validating the approach we took. Specifically, in the first seven weeks of the year to date, we've added approximately 17,000 new consumer customers across the Superloop and Exetel brand. If you look at wholesale, customers grew by 198,000 customers in the year. In the business segment, the number of customers increased by some 15,000. slide 14. As I'm sure you're aware, in September this year, NBN is rolling out changes that will increase the demand for high-speed internet. Under NBN's so-called Accelerate Great program, 100 Mbps plans are being upgraded to deliver 500 Mbps, and there will also be new 2-gig plans.
Based on research published by NBN, the market for 500 Mbps and above products is expected to grow from some 300,000 services in FY 2025 to some 2.8 million services this year, FY 2026, further expanding to 4.2 million services by 2029. This plays right to our strengths, with both Superloop and Exetel ready to capitalize on the new high-speed opportunity. Our share of new 1-gig orders in FY 2025 was 25% of the entire market, and we're confident in continuing to take market share as the high-speed segment radically expands from next month. We're particularly excited about the new Exetel One plan, AUD 80 a month for a 500-Mbps service, as are the 11,000 new customers who have taken it up in the seven weeks since launch to July.
On slide 15, you can see that during the year, we made significant strides in uplifting our ESG credentials, recognizing the fact that as we get larger, attract new shareholders, and are included in new indices such as the ASX 300, we must continue to be proactive in meeting the evolving expectations of all our stakeholders. With that, I'll hand over to Dean to provide some more detail of the financial performance.
Thank you, Paul. It's great to be presenting Superloop's financial results. I will step you through our high-level results before I drill down into more detail. We are seeing continuing positive trading momentum within our segments, and this is driving strong revenue growth, up 31% to AUD 546 million. The group delivered gross margin of AUD 190 million, an increase of AUD 45 million, or 31% on FY 2024. Operating expenses of AUD 103 million increased 12% overall. Our operating expense growth is well below our revenue growth, and good operating leverage is being achieved. Underlying EBITDA grew 70% to AUD 92.2 million, well ahead of our revenue growth of 31%. As Paul has highlighted, NPAT is now positive at AUD 1.2 million and represents an improvement of AUD 16 million over the last year. Lastly, Superloop continues to generate strong free cash flow, up AUD 27 million-AUD 56 million in FY 2025. Now turning to gross margin.
As mentioned on the prior slide, group gross margin of AUD 190 million for the year represented an increase of AUD 45 million on the prior period, and the group gross margin percentage remains steady. Consumer gross margin increased by AUD 25 million, or 33%, as a result of strong customer growth. The wholesale segment gross margin increased by AUD 19 million. Lastly, the business segment was basically flat at the revenue and gross margin line, with new wins and volume growth offsetting data price declines. Now moving to slide 19. This slide is one of my favorites and really demonstrates the upside in the business as we continue to add customers onto our platforms. Operating expenses did increase by AUD 11 million-AUD 103 million to support our additional scale, with AUD 2.7 million of this increase relating to marketing. However, it's clear we are delivering strong operating leverage.
You can see the trend of reducing opex to revenue down a further 2.9%, ending at 14.4%. The efficiency built into our low-cost operating model continues to be a key to our success. Now moving to slide 20. Total CapEx this year was AUD 28.4 million at the lower end of guidance, AUD 12 million in equipment and infrastructure, which further strengthened. In support of our accelerating smart communities business, we increased our CapEx spend in this area. We continue to maintain our investment discipline, which is reflected in the CapEx to revenue decline we can see over the last three years. CapEx to revenue is now at 5.2% in FY 2025. Moving to slide 21. The business is generating strong cash flow. In FY 2025 we delivered gross operating cash flow of AUD 88 million, up 55% on FY 2024, and free cash flow of AUD 56 million, an increase of 93% on the prior year.
The company has a net cash position of AUD 29.5 million and a conservative debt position, with debt covenants well below thresholds. Our significant debt capacity provides us with funding flexibility to pursue M&A opportunities that are aligned with the business strategy, and we remain focused on accretive growth. I'll now pass back to Paul for the segment update.
Thanks, Dean. Yeah, jumping into the segment update, we'll start with the consumer segment on slide 23, please. As I've already noted, the consumer segment achieved great results in FY 2025, increasing revenue by AUD 99 million to some AUD 364 million for the year. We added 63,000 customers during the year, and we continue to achieve great success, in particular with those high-speed plans. Gross margins came in at 27.4%, remaining comfortably above our 25% long-term target. As mentioned earlier, in the second half, customer adds were lower than in the prior corresponding period, as we did an early reset of pricing and paused the marketing of Exetel. These decisions were deliberate, and I'm pleased to say they set us up for the great momentum that we are now seeing in the period since July 1.
Specifically, it's encouraging to note that we've added approximately 17,000 net new customers in the consumer segment in the first seven weeks of this financial year across the Exetel and Superloop brands. I move to the wholesale segment in slide 24. You can see that our strategy of enabling challenger brands has led to a record 198,000 increase in customers in the wholesale segment for the year. Revenue came in at AUD 78 million, up 62% on the prior year, and gross margin came in at 61.1%, which is also above our long-term target for the segment of 60%. Customer numbers in the second half were impacted by the expected loss of the 17,000 Symbio customers, which migrated to their parent company as expected. The business segment on slide 25. In this segment, there were signs of improving market conditions.
We are at the tail end of the repricing event that we previously discussed, and new wins and volume gains enabled us to maintain revenue and gross margins despite the sector headwind. Gross margin percentage was 40.5%, which is also above our long-term target of 40% for that segment. Pleasingly, business NBN customers increased by some 11,000, and we achieved strong sales in smart communities with a record 18,000 lots secured, comfortably above our sales target for the year. I'd like to spend a bit of time on the smart communities business, which you can see on slide 26. I'd spend the time on it as we do see it as a long-term, high-quality growth engine for the company. In contrast to our other segments, which are primarily focused on existing brownfield premises, our smart communities business builds and operates new greenfield FTTP and Wi-Fi networks.
Our markets are broadacre developments with customers such as Resimax and AV Jennings, residential apartments and mixed-use developments which leverage both our FTTP networks and our intelligent Wi-Fi solutions, built-to-rent developments which include customers such as Mirvac and Investa, smart community and public Wi-Fi for customers including the Sunshine Coast Council, and finally, managed Wi-Fi for student accommodation offered by customers such as UniLodge, Campus Living Villages, and others. A key feature of this business is that it is all on-net for Superloop and does not involve the reselling of access networks such as those from NBN. Naturally, the nature of such on-net business represents a long-term annuity-style wholesale revenue and dramatically superior margin profile. On slide 27, you can see some landmark sales wins for the division.
Perhaps the highlight of FY 2025 for the smart communities team was in the signing of 10,000 new lots for the Bradfield City development with the New South Wales Government. In total, we contracted 18,000 new lots in that past year, taking our total to 97,000 contracted lots. Of these, 55,000 are connected, with 44,000 of those active and billing today. We also have a further 42,000 lots contracted but yet to be built. We're seeing build activity accelerate and look forward to the steady increase in our billing lots over the next few years. On slide 28, you can see some of the opportunities that we signed during the year. If we jump to slide 26, please. In July, we relaunched the Exetel brand with the new Exetel One plan. The One plan is a 500 Mbps service that focuses on simplicity with bold, eye-catching branding.
We've ceased offering any legacy products under the Exetel brand to new customers and are only selling the One plan, a single plan, single price, no time-limited promotion periods. A key feature of the plan are speeds that can be dialed up and down with the click of a button. Everything is AI and digitally led, with customer support available exclusively through the app and web-based chat. slide 31. We're targeting a particular demographic with this plan, the tech-savvy, time-poor value seekers that are typically Gen X or Millennial. They are digitally confident and also value conscious. In meeting their expectations, the One plan delivers high service levels, demonstrated by the fact that over 86% of orders placed are activated within 15 minutes. We've seen strong success so far, with the One plan securing 11,000 new customers in the seven weeks post-launch. slide 32.
Changing gears a bit, with one year left to go in the three-year double-down strategy, we are tracking well and remain confident of reaching our ambitions by the end of FY 2026. Revenue and underlying EBITDA targets are on track. We delivered a positive NPAT-A in FY 2024 and now a positive NPAT in FY 2025. M&A is still a feature of our business, and as noted earlier, we have significant capacity to support these activities. slide 33. FY 2026 will see us focused on delivering the final targets of the double-down strategy and driving more growth from our platform. Superloop is poised to capture the NBN speed bestowal opportunity with our high-speed plans. We will accelerate business growth with smart communities moving into the delivery phase, and Superloop remains laser-focused on maintaining our position as a cost leader, driving further operating leverage.
We seek to identify and execute M&A opportunities that have strong strategic alignment to our business and leverage our platform and balance sheet. As mentioned, FY 2026 is off to a great start with 17,000 net new consumer customers added in the seven weeks to 18th of August. We're proud of how we continue to deliver profitable growth in the business achieved through both operational and strategic focus and are strongly positioned to create long-term value for our shareholders. I'd like to thank the team at Superloop for their hard work in what has been a great year. With that, I conclude my formal remarks and I welcome questions.
Thank you. If you wish to ask a question, please press star-one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star-two. If you are on a speakerphone, please pick up the handset to ask your question. The first question comes from the line of Nick Harris with Morgan's. Please go ahead.
Good morning, Paul and Dean. Thanks for the call. Great results.
Thanks, Nick.
A couple of questions from me. Just trying to understand the consumer growth at the start of FY 2026. If I'm comparing apples and oranges a little bit, but if you look at it sort of on a monthly basis, as in versus 12 months ago, it looks like the net or the growth is substantially stronger than it was 12 months ago on a monthly basis. I just wanted to double-check on looking at that rise. Secondly, maybe just to unpack the Exetel stuff a little bit, because obviously that new one brand or one product to suit them all sort of thing looks like it's resonated really strongly. You talked about it adding 11,000 subs since launch. Did it launch at the start of, did it launch in FY 2026, so it's 11 of your 17, 17,000 adds. Does that make sense?
Yeah. I'll ask Dean to clarify any numbers I get wrong here. Yes, the thematic is correct. We've certainly started FY 2026 with a lot more momentum than we did at the start of FY 2025. Now, obviously, we are setting ourselves up to take advantage of the expansion of the high-speed plan market this year, and the Exetel One plan is very much about that. It's front-running the changes in September from NBN. It's really hit the market well. It's a particular product that really just appeals to those high-speed users, which we see as an attractive part of the market. It's a plan that's very much focused on simplicity. It's only available on the high-speed technologies, HFC and FTTP as an example. It's a plan that's all about removing the friction from the process. No promo periods, no tricks. It's the simplicity that we feel is really appealing.
It's a great customer experience, great customer journey. I'd encourage you to try it, Nick. Was there something, Dean, about the numbers you want to bring up?
No, just to clarify, the 17,000 is net new consumer customers until the 18th of August. The 11,000 Exetel new customers, that is between the 1st of July and the 18th of August. Just to confirm, that excludes any migrations or transfers between Superloop and the legacy Exetel brand. That's 11,000 new customers, new customers to the Superloop group in that period of time, which is a little bit over 6 weeks, 6.5 weeks.
Thank you both. That is excellent. Clearly, it's doing really well. Probably just one more, and then I'll jump out of the back of the queue. The cash flow conversion was really strong, which is great to see. Balance sheet looks great. I note you've still got M&A on your acquisitions on your FY 2026 plans. I don't know if you're in a position to maybe give us any details as to what sort of stuff we might be able to look for, or is that too hard to talk about?
I'm going to give you the same answer I've given you previously, Nick, unfortunately. We did see M&A as a key part of the double-down plan. In fact, we said that half of the target would be met through M&A and half organically. Now, clearly, our organic business is running well ahead of expectations, and we've bought very little. We bought Uecomm, but not much else during the double-down period. That's not because we aren't actively exploring M&A opportunities. We are. We're always in discussions, and we are in discussions right now. That doesn't tell you very much. As I said, we're always in discussions. We didn't find any opportunities during the first two years that we've, apart from Uecomm, which we felt were meeting all of our criteria. We have very strict criteria, and we are disciplined about M&A. We have plenty of firepower to undertake M&A.
I think we're pretty good at it. We want to do good M&A when opportunities come up. Clearly, the organic part of the business is exceeding expectations. The need to do it is, you know, M&A is not a strategy. It's a way of delivering a strategy.
Thanks very much.
Thank you. Next question comes from the line of Cameron Bell with Canaccord Genuity. Please go ahead.
Hi, Cameron. Thanks very much.
Hi, morning, guys. I'm just wondering how much industry churn you're expecting around September and October.
Look, clearly, the way we've set ourselves up, getting the Superloop brand into a nice, clean position by bringing the price changes very early in the year this time, setting up the Exetel One plan, we're clearly setting ourselves up for a fairly material churn event or disruption, let's say, come September. It is a significant change in the NBN propositions that are available in the market. When there's a significant change, be that a price shock, CPI indexation, new product categories, whatever it might be, that's where we do well. I do think that the introduction of that speed bestowal or the Accelerate Great campaign, as NBN calls it, will drive industry activity, so an increased level of industry churn. We want to be really taking advantage of that as we generally do during those periods of disruption.
Okay. On the OpEx side, that was a highlight last week, Dean. Do you really ramp up your marketing spend given the opportunity with, I guess, Exetel One and the speed changes?
Yeah, look, in the first half of this financial year, we will increase our marketing spend. The performance of the Exetel One plan has been exceptionally good in the first six weeks. The cost to acquire is really impressive. If it keeps going like this, yes, we'll increase our marketing investment provided the cost to acquire is maintained. As I said, we're seeing really good momentum on that brand. We're hopeful as we move into the speed bestowal event that we can really take some further share through that window of market disruption.
Okay, sure. Just the last one from me. Just how you're thinking about CapEx given recent investments.
Yeah, look, we're really pleased with the discipline we've shown around the CapEx. The trend down in terms of CapEx to revenue is really, really good. We don't see any really sort of significant increases in CapEx coming from the sort of the core network components. We're well placed there. We're invested in network quality, and we have substantial volumes to enable growth. The drivers of CapEx moving forward are essentially associated with continuing success on smart communities. If smart communities continue to go forward and expand, there'll be some, you know, sort of, I'd call it moderate increases in CapEx as we go forward, but that's success-based CapEx. I don't see a step change in CapEx coming. We've made the big investments a number of years back to connect to the NBN poise.
We've got a high-quality sort of asset base, and the Uecomm acquisition has helped us as well.
Thanks, guys. Well done.
Thank you. Next question comes from the line of James Wilson with Macquarie. Please go ahead.
Hi, guys. Thanks for taking my questions. Just a few from me. To start, do you see any risk to the customer growth strategy that you guys have heading into the churn event given that, I mean, not all of your competitors have raised prices completely in lockstep with you? I understand you've called out that maybe the churn of existing customers has sort of ended, but what about growing incrementally? Do you see any risk to your strategy on price?
Look, there's always risk. I'd call out the structure of our business is not just about the consumer. Part of our strategy is to enable all of the challenger brands. A core of our strategy is to enable all the challenger brands, and we see ourselves as a wholesaler first. We have a whole pile of brands that we support through the wholesale platform, not just Origin, although, of course, that's the largest. The combination of brands that we are supporting gives us great exposure to the inevitable high-level churn that will come through that event. I think your question was more about our consumer brands specifically. We guide our consumer business more around cash. We want to make sure that the customer base we acquire is optimized. We keep, in the sense that our cost to acquire is kept under control. We balance our marketing investment against competitive intensity.
We would prefer to give up volumes rather than give up value and maintain a portfolio across the whole of the business that continues to grow comfortably in the long term. There's always risk that the consumer market could get more competitive than we plan, although clearly we're driving competition and we think we're really well set up to take advantage of it. We are exposed broadly to the market as well to benefit from the change.
Great. Thank you. If we just move to the business segment, can you talk us through maybe your expectations around the NBN market and the discounting that you've seen historically there? Also, maybe if you can give us an idea around the timing of when we might see an uplift from the smart communities business actually contributing materially into growth in that segment.
I'll try the business question first. Dean, maybe if you think about the smart communities question. The sector, the whole of the business market has been, or the fiber-based business market has been materially impacted by the introduction of the NBN. No one can shy away from that. Private fiber services have been put under pressure by the fact that the NBN services deliver well. There has been a significant step down from traditional private fiber networks, MPLS networks, onto NBN's more TC4-based services or even their Enterprise Ethernet products at a lower price. That sort of price erosion is not a Superloop issue. It's a market issue, but it's been an issue for some years. Typically, businesses contract on around about a three-year, sort of two to three-year contract, and most of the market has been going through that for several years now.
We really do see that the tail, we are now facing the tail ends of that kind of structural change in the market. Our volumes have held up well. We've been taking share in the market, and you can see that our revenues have stayed pretty flat. They've stayed flat in defiance, let's say, of the significant price erosion that we've had to deal with. Volumes have outweighed revenue lost through price erosion there. With that momentum that we have in volumes, we obviously hope to return the business, or we expect to return the business segment back to growth during this financial year. Dean?
Great. Okay, just on the smart communities, we've actually provided some more information this year. There's some more clarity around the timelines of build. If you look there at the moment, we have 42,000 lots that are in various stages of construction. We anticipate around 35,000 of those will be delivered within five years. The smart communities this year has been a stellar result, not only the volume of new contracts that we sign, but the names are so important as well. I think it's great recognition that we were successful in winning Bradfield. That's a contract with the New South Wales Government for 10,000 lots building a complete new city. I think that has been very much a recognition of our capabilities, our presence in the market, and it's certainly opened up a lot more opportunities for us moving forward.
You can essentially take 35,000 and see that it's been delivered within the next five years. We're incredibly proud of what we've achieved in the last 12 months, and I think it sets us up for a lot of growth moving forward in smart communities.
Thanks, guys. Just one quick final one from me. Are you able to give us just an idea on the active current smart communities number, maybe what the revenue or the earnings contribution is from that business currently?
I don't think we've broken that out specifically. Let's take that as an action, and we'll think about how we can represent that.
Thanks, guys.
Thank you. Next question comes from the line of Benjamin Jones with JP Morgan. Please go ahead.
Morning, guys. Thanks for taking my question. Just on that wholesale business, are you able to quantify the revenue or EBITDA impact of that Symbio customer loss? When in the period did that happen, and how can we think about that annualized impact?
Look, it happened in the second half, in the sort of latter part of the second half. I think the gross margin contribution from the Symbio, we've said many times, is under AUD 2 million. It's not that material to the business.
Got it. It makes sense. Obviously, Exetel, those early subs have been very strong. What does that Exetel brand mean for your gross margin target from here?
It is dilutive in the sense that we've positioned Superloop at a higher price than Exetel. Of course, on simple maths, that suggested that it's at a lower gross margin. We run our consumer business at a portfolio level. We have a portfolio gross margin with some plans on higher margins, some on lower, and it's different across the different brands. We haven't changed our gross margin target for the segment. It's a mixed question. We're very comfortable that the Exetel product is a sensible product for us. We expect a lower churn profile on the Exetel product. One of the primary drivers of that is no promo periods. There is a drug that the industry is on, which are the six-month promotion periods, and lots of bargain seekers migrate out at the end of the promotion period to a different provider who's providing a promotion period there.
We think the removal of promotion periods on this brand and just the excellence of the experience, I'd encourage you to try it. The customer journey is so elegant. We think that we will see a very different churn profile on that customer. At a cash level, they will be as valuable customers to Superloop as a Superloop-branded customer on a lifecycle basis. I think the answer to your actual question is no change in our segment gross margin aspirations, but a slightly different portfolio mix.
Yeah, and Paul, I'd like to make a comment on that one. As a consequence of the way we're delivering that product, there's a step reduction in our cost to serve, which is really impressive. We believe that we'll see a longer customer lifetime value because we're not attracting those that are switching for based on promo discounts. The service metrics around this product are exceptional. We're really delighted with how the AI is working. It's the second sort of addition of our AI bot, and we're seeing 86% of all sort of chat handled by the bot, which I think is an incredible result. The cost savings and delivery model on this one are great. Obviously, we'll take the benefits and efficiency around this back into our Superloop brand over time as well.
Yeah, fantastic. Makes perfect sense. Just on the credit you provided in that consumer business of your 17,000 subs in the first seven weeks, I get to sort of 2,500 subs a week on a basis. Now that you have that dual branch strategy in market, noting you have put a bit more marketing spend, if you do hold that marketing spend from here, is that sort of weekly rate of additions sustainable through the year?
No, look, we'll be realistic. The product is front-running the NBN change that is available to the market in September. We took a deliberate decision to launch early and shape the product to deliver it accordingly. We have benefited from being early and getting the mind share. It will definitely get more competitive when many other brands do as we expect they will do from September and launch their own versions of the Accelerate Great program. We think we're very well positioned. As I said, during these periods of high churn, given our acquisition share in the market is substantially higher than our market share, that will be positive for Superloop. I think it will be unrealistic to expect that the starting run rate could be just annualized out and as a full-year aspiration.
Yeah, makes sense. That's all for me. Thanks, guys.
Thank you.
Thank you.
Thank you. Next question comes from the line of Annie Zhu with Barrenjoey. Please go ahead.
Annie.
Hi, morning. Thanks for taking my question. My first question is on the consumer business. There's been some concern around the subs slowing in the second half of FY 2025, but you still met your gross profit and EBITDA expectations. That means that our gross profit per sub is actually higher than what everyone thought. Now that sub growth is likely pacing ahead of what consensus thinks in FY 2026, is it possible that there hasn't been a change in your thinking around FY 2026 consumer revenue spend because the sub endpoint isn't materially different, but the profit per sub is higher?
Yeah, look, we decided to make those changes, as Paul indicated, in May and June to set ourselves up for FY 2026. It was a decision made to enable us to put the prices through to both our Superloop and our Exetel base. We're really proud now in terms of what we're achieving so far in the first six or seven weeks. We very much believe we made the right decisions as evidenced through the results we're achieving. Yes, broadly in line with what you're saying, we did put some price increases through, which will certainly help us as we move into FY 2026 on our base. We're really happy with the volumes we're seeing coming through on consumer today.
Thanks. Just on your double-down targets, I noticed that the 500,000 consumer customer target wasn't mentioned. I'm just wondering if you're stepping away from this target?
No, I think you're probably giving it more thought than we did, to be honest. Our key targets, obviously, are the annualized AUD 700 million at the mid to high teens EBITDA. The 500,000 subs that were there was a derivation to get us to those numbers. No, there's no change in aspirations or targets as such in the double-down plan.
Thanks. Just one last question for me on smart communities. Just sort of trying again on a question that was previously asked. You've previously called out that the earnings uplift associated with, I think, 10,000- 15,000 contracted lots would be worth more than AUD 5 million of gross margin annually, and that was to be realized in FY 2026. I'm just wondering if there was an update on this or if that still holds.
I think the numbers are correct. We do have a sort of 10,000- 15,000 contracted lots per year sales target. Obviously, at 18,000, we had a great outcome in FY 2025. Yes, when we convert those to billing lots, we would expect that to add around about AUD 5 million of margin/ year. It takes time to build them. If I take the Bradfield example, Bradfield literally is a regional, or sorry, a rural environment at the moment. There is a metro being built. The first building has gone up. It will take quite some time for roads and pits and pipes and houses to be built and tall, shiny buildings, etc. That AUD 5 million is, you know, for that to be every year compounding, it'll take us a little while to get to that point. That is the ultimate destination, though, where we see it going.
Thank you very much.
Thank you. Next question comes from the line of Liam Robertson with Jarden. Please go ahead.
Hi, Liam.
Thanks. Morning, team. Just first one from me on the trading update. Obviously, really strong consumer, you know, run rating closer to 130,000 annually. Compositionally, then Exetel outperforming the core brand. If that momentum continues, I'm just keen to unpick the impact on gross margins. I know we've sort of already touched on this, but if I can put some numbers around it, it looks like at current prices, you're making almost no gross margins. AUD 80 headline price, less GST. You're then paying the NBN, you know, close to AUD 72 a sub because you're effectively having to pay for the 1,000 to be able to offer the 500. Post the NBN speed bestowal, obviously, that gross profit will jump to a plus side of AUD 12. That suggests your gross margins are sort of plus side of 25%, which is more in line with your long-term aspirations.
Is that the right way to think about it? Short term, the Exetel subs will be dilutive, but post speed bestowal, you're comfortable with the returns at that AUD 80 price point?
Yeah, a couple of points in there. Firstly, I don't agree that Exetel's outperforming Superloop. We were talking about the Exetel One plan there. It's a new plan. Obviously, there's attrition on the Exetel base, on the legacy base. We're very happy with the way Superloop is performing at the moment as well. It's actually performing particularly well. The question about the gross margin in the period between today and when the speed bestowal actually happens, you're correct. We don't make a lot of gross margin in the short period between now and when the NBN price changes come through. I mean, that's no different to if we'd given a price promo, which we're not going to be doing, obviously, with the Exetel brand. That is a decision we took to get the momentum behind it, and we're very happy with that decision.
Clearly, the gross margin improves once the NBN price change comes through and it sits on the back on the 100 Mbps plan, which is bestowed with the 500 Mbps. Again, I'd just sort of come back to the meta point, which is we're not giving our consumer segment leader any relief in the expectation at a portfolio level on gross margin for the year. We run it as a portfolio. There will always be some plans that are under the average and some plans that are over the average, and we're very happy with the way we're set up for the year.
Yeah, that's good, Paul. The other thing I'd highlight is Superloop will be our primary brand. The vast majority of our marketing spend in terms of brand support will go behind the Superloop brand. We're not expecting a really significant change in the mix from what we've had in the last 12 months. We're not expecting a significant drop in gross profit margin as a consequence of the Exetel launch.
Perfect, thanks. Just my second one. Obviously, you're holding the team to that minimum 25% gross margins in consumer. If I then look at the wholesale segment, you've got that aspiration of 60%. You're already above that. Given the Origin contract is reported on a net revenue basis and will obviously become a larger proportion of that segment, is that a target that you need to review?
It's not a target that we have agreed a change with the board at this stage. Clearly, it's tracking well, and there's some fundamentals in there that are very supportive of the wholesale gross margin. It is something we'll think about going forward, but there's no current change.
Okay. Just last one on CapEx. Dean, I think you mentioned earlier you're not necessarily expecting a significant step up moving forward. Can I just ask about the unity agreement? I think from memory, that sort of comes up in FY 2026, which, to my understanding, might actually require a step up in CapEx. If it doesn't, then potentially there'll be a COGS impact into 2026. Is that the right way to be thinking about the unity agreement?
You're correct. The Unity agreement does come up in that timeline. We're in discussions with Unity at the moment around potential renewal. The same logic applies as applied when we put the agreement in place the first time around, just efficient use of cash. We will update the market when we have something to update on. If we do renew that agreement, there's the same sort of quantum, a little bit more, but more or less the same quantum of cash that would go into the renewal.
Perfect. Thanks for that, cheers.
Thank you. Next question comes from the line of Kanan Hannan with Goldman. Please go ahead.
Morning, guys. Thank you for the question. If I just double- down and target that mid-high teens margin, like 15%- 19%. Sorry if I'm missing something here with that calculation, but you were sort of 19% in the second half, sort of guiding to 17% or targeting 17% at the midpoint there. Just talk me through some of the moving parts there that either imply that margin compression or what I'm missing in that assumption.
I don't think you're missing anything. The reality is we set that mid-to-high teens EBITDA expectation at the start of a three-year plan. We were a million miles from that at the start. It was a pretty ambitious aspiration that we set, and we're tracking exceptionally well towards it. I think you can read between the lines there. We're pretty confident of hitting that target at the end of the period. We haven't changed the target, of course.
Okay. Helpful. The decision not to put sort of formal guidance in the market for next year, with the Origin migration, you've obviously given us a lot of the building blocks with those targets. Is there anything driving some uncertainty on your side that means we don't want to have guidance in the market?
Superloop's never, with the exception of last year, and we needed to last year with so many moving parts, including the materiality of the Origin contract. We've never given guidance at the full-year results. We've traditionally given guidance at the AGM. We haven't resolved with the board to do that specifically this year, but my expectation is we would do the same thing.
Yeah, awesome. Thanks, guys.
Thank you. Next question comes from the line of James Bales with Morgan Stanley. Please go ahead.
Thanks, guys. Firstly, what sort of response do you guys expect from incumbents post-September in terms of the plans that they offer and the price points? How does that feed into your planned marketing spend for FY 2026?
James, with all due respect, I don't think we can really comment on what other brands will do. We've spent a lot of time and a fair bit of money setting ourselves up to really come out of the blocks strongly in FY 2026 and be ready. Ready doesn't just mean price points. It means our delivery capability, our customer journeys, our support environments, our CPE strategy, so the modem strategy in the house. There's a whole raft of activities that have gone into setting ourselves up to deliver a great experience through that speed bestowal event, and we think we will do well through it. What other brands are planning to do with their own network assets or customers is really up for them. I think we are really well set up with everything that we have in our control.
I guess where I was going there was you made the comment earlier that the brand focus is still going to be on Superloop. It seems like a lot of the marketing dollars early have gone into Exetel. Is the plan post-September to materially change that mix?
Sorry, no, my mistake. There was a bit of money put behind the launch of the Exetel One plan, but no, we are not changing the mix. Exetel is a very low cost of acquisition target, very low marketing spend that goes into it. It's a digital-only, social referral-based marketing strategy. The Superloop brand will still maintain the vast bulk of our marketing spend as it does even now and will going forward. We're not going to revisit that strategy. Exetel is a lower gross margin product, and part of the reason why at a cash level we think that the Exetel customers are still very available to us is because of the very modest investment that we will be doing around acquisition.
Got it. That's helpful. Thank you.
Thank you. Next question comes from the line of Evan Karatzas with UBS. Please go ahead.
Hi, thanks. All right, good to see all the interest in smart communities and also thanks for the additional disclosure. You're clearly becoming a bit of a, I guess, a more known entity in this space. Can you just speak to or put some metrics how your RFP or your tender pipeline is looking compared to this time last year, and also where it's mainly focused on from either an SDU or an MDU or a student Wi-Fi type segment, I guess?
Sure. Clearly, the most attractive part of the market is the fiber-to-the-premise market. Obviously, the student tertiary accommodation sector has traditionally been a big part of our business, and it's a great business, and we do very well in this space. Whilst we still want to continue to be number one in that part of the market, it's a limited-size market. Our focus is on the new developments, the Greenfield, FTTP space, and that is a mix of broad acre and multi-dwelling units. At the moment, we are having more success in the MDU space, and it really is closely aligned with our credentials. Built to rent as an example. Again, even Bradfield, there's a very high proportion of MDUs in the Bradfield win that's out there. You asked about pipeline size.
We don't give out a pipeline size as such, other than say that the market typically has that kind of 200,000 new developments that happen each year through the cycle, and we've got our sort of market share aspirations within that. I think a key thing to call out would be the credibility. Winning Bradfield, 10,000 lots with the state government, is a real vote of confidence in our proposition in its entirety. Our technology, the credibility of our delivery, the strength of our balance sheet, the RSPs that are selling the product, it is a real sort of reinforcement of credibility and announcement to the market that we can take the very largest developments and deliver them well.
Absolutely. All right. Maybe just one quick sort of housekeeping one. Can you just remind us of how that AUD 3.7 million of Origin consideration plays out in the wholesale numbers, like from the revenue and the gross margin numbers, just the whole machinations there? It's just been a bit of a discussion around the ARPU or the AMPU or the gross margin per sub for the wholesale in the wholesale segment in the second half coming down. I just want to understand, I'm guessing that's probably got a bit to do with it. If you can just remind us how that all plays out, please. Apology if this has been asked already.
Okay, I think I'll take that one. The way from an accounting perspective that was recognized originally was the value of the equity we provide to Origin. At this initial contract transition and milestones, it ends up being on our books as a contract asset. Each year, based on projections in terms of their performance, we then debit their revenue. We have a reduction in our revenue. Obviously, the other side of the entry is an adjustment to the contract asset. In the appendix, we've provided you with what the amount is. Effectively, in the revenue that we show in our numbers, there's an adjustment, a debit that goes through as we amortize the contract asset.
Okay. All right. It reduces revenue in GP, but then it comes back through in the, I guess, the underlying EBITDA is where you bring it back.
Yes, good summary of it. Thank you.
All right. Go on. Thanks, guys.
Thank you. Next question comes from the line of Ross Barrows with Wilson Advisory. Please go ahead.
Hi, Ross.
Hi, Paul. I'll leave the smart communities. I think it's been covered pretty well. I guess the one that I was going to ask was just around the market share. You called out that you captured 25% of all new orders for the one gig plan in 2025. Do you have any market share aspirations you're able to share for 2026? I mean, especially on that slide, you call out the forecast active services growing meaningfully from a very humble number this year to almost 3 million in 2026. Just some thoughts around, obviously, the traction you had this year, obviously, on a much smaller base, but where you think you can land in 2026.
Yeah, we haven't published a target on it. We obviously have our internal aspirations. I'd sort of come back to what I said before. The high-speed part of the market is our hunting ground. We've spent several years really polishing our customer journeys and our whole proposition in that space. We're doing well. Obviously, the 25% of orders sort of bears that out. We're ready, and there's going to be a lot of churn in that part of the market. I know that's not your question. You're asking for a specific target. I don't have one to share with you, or we're not disclosing one. We think we're really well positioned to take advantage of what's coming.
Very good, thanks.
Thank you. Next question comes from the line of William Park with Citi. Please go ahead.
Thank you. Thanks, Paul and Dean, for taking my question. Just a quick one, and my apologies if this has already been asked, just in terms of the Origin contract, can you provide some color around how things have sort of tracked in the first half to date? I know that you guys don't typically comment on Origin's own aspiration of 600,000 by the FY 2026 year- end, just in terms of how things are tracking and if you could provide some color around whether you expect that sort of momentum to continue or be accelerated, please. Thank you.
Yeah, look, apologies. We don't just not comment on Origin's aspiration for growth. We also don't comment on Origin's retail performance. That's really up for Origin to communicate to the market. I'm going to have to sort of pass on that one, apologies.
No worries.
Thank you. There are no further questions at this time. I'll now hand back to Mr. Tyler for closing remarks.
Okay, thanks. Thanks, Aaron, for joining, and those who are still here. We are very proud of the results we've printed in FY 2025. We feel great about the way the year is shaping up for FY 2026 and the opportunities that will emerge. Thanks for making the time, and look forward to a great year. Thank you.
Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.