‘Things are rolling’ at Kinaxis as software firm’s revenues rise 11% in Q1

May 9, 2025

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Kinaxis says efforts to boost its sales and marketing capabilities are paying off with a growing pipeline of new business even as the uncertainty swirls around the economy amid a global trade war. The Kanata-based firm says it is seeing growing demand for its supply-chain management software as new customers sign on and existing clients tap into new offerings such as Kinaxis Tariff Response, an AI-powered product launched last month that helps manufacturers run what-if scenarios to predict the potential impact of tariffs on their bottom lines. Kinaxis’s revenues rose 11 per cent in the first period compared with the same period a year ago, while the firm also landed some high-profile new customers that include one of the world’s biggest semiconductor companies. “That was the deal that everyone wanted to win, and we’re very proud that it came to us,” chief financial officer Blaine Fitzgerald told analysts on a conference call Thursday to discuss the company’s latest results. “Things are rolling right now.” Kinaxis also recently inked new partnerships with New York-based enterprise software maker Infor and California-based big-data analytics firm Databricks, deals officials say will broaden the Kanata company’s customer base and strengthen its expertise in areas such as AI. “The team is executing at a different level than we’ve ever seen before,” Fitzgerald said. “The (customer) conversion rates that we’re seeing … are much higher than we’ve ever seen before. I’m pretty excited about some of the names I see in the Q2 pipeline and that large enterprise cohort that we always seek to win. We’re seeing a lot more of that in our pipeline, which is great.” Interim CEO Bob Courteau said Kinaxis’s moves to bolster its sales and marketing teams, such as bringing on new reselling partners and hiring industry veteran Mark Morgan last fall as president of commercial operations, are bearing fruit. “All those things are working for us,” Courteau said. “Every quarter, we’re just trying to get a little bit better, and we feel like we are.” Kinaxis, which keeps its books in U.S. dollars, reported revenues of $132.8 million in the first quarter, up from $119.4 million in the same period a year ago. Software-as-a-service revenues, which are generated from the monthly subscriptions that make up the bulk of the company’s income, rose 16 per cent year-over-year to $84.9 million. The firm’s adjusted EBITDA rose 46 per cent to $33.1 million, while its profit soared to $15.9 million, or 55 cents a share, from $6.2 million, or 21 cents a share, as Kinaxis was able to keep operating expenses in check while boosting sales. Kinaxis reiterated its revenue projections of between $535 million and $550 million for this fiscal year when currency fluctuations are taken into account, a growth rate of 12 per cent over 2024 at the midpoint. “We believe that our (revenue) guidance is in a good place,” Courteau said. “The wild card is the economy and how that plays out. But generally I would say the company is in a really, really good period right now.” Still, Courteau conceded that U.S. President Donald Trump’s tariff campaign is prompting customers to keep a close eye on spending. He said Kinaxis will continue to work on new generative-AI products aimed at helping customers get a better handle on how events such as the trade war will affect their supply chains. The company will also be implementing a new pricing framework “to better reflect and take advantage of the more universal integration of AI through Maestro (Kinaxis’s flagship software) and the higher value it brings,” Courteau added. “You’ve got to be on your game in this environment,” he said. “There’s no doubt that as an enterprise software company that you’re competing for capital right now in a very cautious world.” Meanwhile, the company’s search for a new permanent chief executive to replace John Sicard, who retired at the end of last year, continues. Courteau suggested Kinaxis’s board of directors is in no rush to put a new CEO in place. He told analysts the company is “being patient” in its recruiting process, with the goal of “finding the absolute best person for the role.”