Good morning, everyone, welcome to Sagtec Global Limited Fiscal Year 2025 earnings conference call. My name is Xin Loong, Chief Operation Officer of Sagtec Global Limited, and joining me today to discuss our results is Kevin Ng, our Chairman, Executive Director, and Chief Executive Officer. Before we begin, I would like to take this opportunity to remind you that our remarks today may contain forward-looking statements, which are subject to future events and uncertainties. Statements that are not historical facts, including but not limited to statements about the company's beliefs and expectations are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and our actual results may differ materially from these forward-looking statements. All forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our filing with the SEC.
This presentation also includes certain non-GAAP financial measures, which we believe can help evaluate our performance. However, those measures should not be considered substitute for the comparable GAAP measures. The accompanying reconciliation information related to those non-GAAP and GAAP measure can be found in our earning press release issued earlier today. Without further ado, I will now turn the call over to our Chairman, Executive Director, and Chief Executive Officer, Kevin Ng.
Good morning, thank you for joining us to discuss Sagtec fiscal year 2025 performance. 2025 was an outstanding year for Sagtec. We are proud to report record high revenue of $19.1 million, marking a 49% year-over-year increase, and our gross profit increased by 45% year-over-year to $4.3 million. This achievement is particularly meaningful given the global economic uncertainties we navigate, and it reflect the resilience of our business model and the strength of our team. Our strong financial result demonstrated the growing demand for our innovative technology solutions, particularly in the food and beverage sector, and validated the effectiveness of our strategy initiative. With robust growth in both revenue and gross profit, we are well positioned to sustain this momentum into 2026 and beyond.
Let me now provide a closer overview of our financial performance. Revenue from service soar by 62% to $12.2 million, driven by a strong client retention and the acquisitions of new customers. Revenue from tangible product rose by 26% to $6.6 million, fueled by rising demand for our food ordering kiosks, supported by evolving customers' behavior and labor shortage in the food and beverage industry. In 2025, we made the strategic decision to discontinue our rental service, shifting our focus to machine sales and third-party maintenance. This move has enhanced our scalability and operational efficiency.
Our EBITDA was $3.4 million for the financial year-end December 31st, 2025, representing a margin of 17.8% compared to $2.8 million for the financial year-end December 31st of 2024. The increase of 18.7% was primarily driven by higher operating scale, partially offset by increased depreciation and expansion-related costs. Overall, we are proud of our exceptional progress in 2025, not only in terms of financial growth, but also in operational execution and strategic repositioning. Looking ahead to 2026, we are focused on accelerating our regional expansion, particularly into high potential markets such as Indonesia, Hong Kong, and other parts of Southeast Asia.
We will continue to scale our digital infrastructure, launch enhanced digital solution to meet evolving customers' need, and strengthen our presence in the food and beverage and retail technology sector. Our unwavering focus on innovation and disciplined execution will continue to drive sustainable growth and create long-term value for our shareholder and stakeholder. Thank you once again for your continuous support. We look forward to sharing more progress with you in the near future.
Thank you, Kevin. We have received several questions from our participants. I will now proceed to direct these questions to the management team as we commence the Q&A session. Question number one. What were the key drivers behind the 49% year-over-year revenue growth, and what is the estimated revenue growth for 2026?
The 49% year-over-year revenue growth driven by our fast business channel new subscriber acquisitions. Sagtec are continuing enhance our product features and developing AI food and beverage service features for subscriber. We estimate the subscriber will continuously increase in year 2026
For the second question, can you elaborate on the significant increase in gross profit, particularly how it relates to your expansion strategy and operational efficiency? Given the 55% increase in cost of sales from services, how do you plan to manage rising costs while maintaining profitability?
The gross profit increased due to the revenue increase more on the SaaS, Software as a Service revenue channel, which is we have fixed server costs and high profit margin in this revenue channel. In coming future, the company will focus more on the SaaS business model basis, continue maintain high profit revenue channel. Regarding the increase of 55% in cost of sales is reflected from the revenue channel of outright purchase, self-ordering kiosk machine in year 2025. The self-ordering kiosk machine hits high demand, and it show high cost of sales due to the purchase of the machine. To continue maintain the profit of the company, we plan to increase more revenue from the fixed cost product, such as Software as a Service, SaaS business model, and our Speed+ point of sales products.
For the third question, you have mentioned expansion into Southeast Asia, particularly Indonesia and Hong Kong. What are the key challenges you anticipate in this market, and how will you address them?
Yes. Sagtec is targeting to expand to Southeast Asia, such as Indonesia, Thailand, and others. The key challenge will be the language and culture. The company already well prepared for this in the system. Now our Speed+ point-of-sale system come with Thai language. In the meantime, our strategy to expand to this country is to appoint the major software dealer in the specific country. This will help Sagtec more easy to expand our product into it. With appointing master dealers and sole distributors will help the company save cost on training and also specific territory operation costs.
For the last question, with Sagtec's when you're listed on Nasdaq since March 2025, how do you plan to leverage this public status to accelerate your growth and enhance shareholder value in the coming year?
As per what we have present, listed in Nasdaq, the world largest capital market, improve Sagtec company exposure. This bring the benefit for Sagtec more easy to expand our company to different country with the Nasdaq-listed company status and also make Sagtec more transparent to the public. After listed, the company will have more resources to expand the business. Like we can do merchant acquisition, joint venture, and joint development. All this above will bring Sagtec more higher revenue in future and benefit to our shareholder and stakeholders.
That concludes our Q&A session. On behalf of Sagtec Global, thank you all for your insightful questions and continued support. We appreciate your time today and look forward to keeping you informed as we continue to execute on our growth strategy and expand our presence across the region. Have a great day, and we'll see you at the next update.