FlexiRoam delivers record profitability as AI-powered connectivity platform gains traction
FlexiRoam Limited has reported a significant financial turnaround in its H1 FY26 investor update, achieving record Underlying EBITDA of $2.0m compared to -$1.0m in the prior corresponding period. The FlexiRoam AI-Powered Connectivity Platform (ASX: FRX) has shifted to positive operating cash flow of $1.9m (versus -$0.9m in H1 FY25) across two consecutive quarters, marking a completed turnaround phase as the company enters an acceleration phase focused on scaling its AI-powered eSIM distribution model.
The company’s gross margin expanded to 72.7% from 53.5%, driven by the strategic exit from low-margin revenue streams. Recurring revenue now represents 48.0% of total revenue, up from 36.6% in the prior period. This transformation from losses to record profitability within 13 months demonstrates operational discipline and validates the strategic reset under founder-CEO Jefrey Ong, who returned to lead the company in December 2024.
| Metric | H1 FY25 | H1 FY26 | Change |
|---|---|---|---|
| Underlying EBITDA | -$1.0m | $2.0m | +$3.0m |
| Operating Cash Flow | -$0.9m | +$1.9m | +$2.8m |
| Gross Margin | 53.5% | 72.7% | +19.2pp |
| Recurring Revenue Mix | 36.6% | 48.0% | +11.4pp |
The financial turnaround positions FlexiRoam to pursue growth opportunities from a position of strength. With the balance sheet rebuilt and cash flow positive, the company has capacity to fund expansion without immediate capital raising requirements.
What is an eSIM and why does it matter for global travel?
An eSIM is a digital SIM downloaded directly to a smartphone, eliminating the need for physical SIM cards. Travellers can keep their home SIM for calls and texts while using a travel eSIM for data abroad, accessing services like maps, WhatsApp, and ride-sharing apps without changing physical cards.
Travellers prefer eSIMs over traditional roaming to avoid bill shock and control spending with fixed data plans. This matters commercially because 72% of mobile users globally are on prepaid plans with limited or no roaming options, according to GSMA data. The eSIM model allows these users to access affordable international connectivity without upgrading their home plan.
eSIM adoption is expected to reach 50% by 2028 (GSMA Intelligence), representing a tipping point for mass-market adoption. By 2030, 76% of global smartphone connections are forecast to be eSIM-enabled. The travel eSIM market is growing at 50% annually (Kaleido Intelligence) and is projected to reach US$10B by 2028.
This structural shift creates a significant tailwind for FlexiRoam’s core business. As adoption reaches the mass-market tipping point, the total addressable market expands substantially, positioning the company’s AI-powered platform to capture share from both traditional physical SIM and roaming revenue pools.
AI eSIM agent removes friction for travellers and brands
FlexiRoam launched what it describes as the world’s first AI eSIM agent in December 2025. The platform allows travellers to discover, purchase, activate, and manage eSIM connectivity entirely within WhatsApp, with no app download required. The AI-guided setup process takes under three minutes and provides instant 24/7 support in over 70 languages, removing both technical complexity and language barriers.
For brand partners, the AI agent eliminates integration complexity by removing the need for API integration, SDK deployment, or app updates. Partners can deploy the service by sharing a WhatsApp link, with FlexiRoam handling provisioning and support. This contrasts with traditional eSIM distribution, which typically requires months of development work, dedicated engineering resources, and ongoing technical burden.
The AI agent addresses two critical friction points in eSIM adoption. For travellers, app fatigue represents a major barrier, with research showing 77.9% of users abandon transactions when forced to install a new app (Heady App Friction Study). For brands, 68% report being prevented from embracing new technology due to legacy systems (Pegasystems/Savanta, 2025).
App Abandonment Research
“77.9% abandoned a transaction due to mandatory app install” (Heady App Friction Study)
The AI agent unlocks new distribution channels by eliminating integration complexity. This shortens partner sales cycles and accelerates time-to-revenue from new enterprise deals, particularly in sectors where technical barriers have previously stalled commercial discussions.
Enterprise momentum building with Generali and Dialog partnerships
FlexiRoam secured its first travel insurance partnership with Generali Insurance in December 2025, deploying the AI eSIM agent as a value-added benefit for policyholders. In January 2026, the company secured a national IoT rollout with Dialog for mPOS terminal connectivity, expanding beyond its core travel connectivity segment into enterprise IoT applications.
The company’s existing Mastercard relationship provides an established distribution channel into the financial services sector, with 410 banks across 78 countries operating 1,187 live card programmes integrated with FlexiRoam’s connectivity platform. Management stated the pipeline is building across insurers, airlines, and banks as the AI agent reduces deployment friction.
These enterprise wins validate commercial demand for the AI-powered platform. The partnerships demonstrate the technology’s applicability across multiple use cases, from consumer-facing loyalty programmes to mission-critical enterprise connectivity requirements.
$65 billion addressable market across brand acquisition and rewards budgets
FlexiRoam positions its offering to tap into existing brand marketing and rewards budgets rather than requiring new spending categories. The company quantifies the addressable market at US$65.3B annually, comprising US$17.8B from OTA sales and marketing spend (Booking, Expedia, Airbnb, Trip.com) and US$47.5B in US credit card rewards value distributed to consumers (CFPB, December 2025).
This budget pool translates into approximately 6.3 billion annual distribution moments where connectivity can be bundled into existing customer interactions:
- 2.0B airline loyalty members
- 1.2B hotel loyalty members
- 0.9B airline bookings
- 1.0B hotel bookings
- 1.1B credit card issuances
- 0.3B insurance policies
The large addressable market combined with eSIM reaching mass adoption creates significant runway for growth. FlexiRoam’s AI platform positions it to capture share of these existing brand budgets by offering a zero-integration deployment model that removes the technical and resource barriers that have historically prevented brands from offering connectivity as a customer benefit.
Balance sheet rebuilt with positive working capital and increased cash
Net current assets improved by $6.5m to $0.3m (from -$6.2m at December 2024), returning the company to positive working capital. Net assets improved by $5.7m to $4.2m, while cash balance increased by $2.0m to $3.2m as at 31 December 2025.
The strengthened balance sheet provides financial flexibility to pursue growth opportunities without immediate capital raising requirements. Tighter collections processes and disciplined payables management contributed to the working capital improvement, positioning the company to fund expansion from operating cash flow.
Outlook focused on scaling partnerships while maintaining profitability
FlexiRoam outlined four strategic priorities for the acceleration phase:
- Scale brand and enterprise partnerships: Use zero-integration distribution to expand existing partners and win new programmes across financial services, airlines, and insurance
- Strengthen AI platform: Enhance the AI connectivity platform across enterprise and DTC channels, fine-tune pricing and underwriting models, and deepen automation across provisioning, support, and programme operations
- Grow profitably: Pursue revenue growth while maintaining positive Underlying EBITDA with disciplined operating expenditure and ROI-gated investment
- Maintain strategic optionality: Evaluate select opportunities including partnerships, complementary acquisitions, and capital management initiatives where they enhance distribution, strengthen unit economics, or support long-term growth objectives
The outlook signals disciplined growth with financial guardrails. Management emphasised commitment to maintaining positive Underlying EBITDA while pursuing revenue expansion, indicating a focus on profitable growth rather than revenue growth at any cost.
Founder-CEO Jefrey Ong holds approximately 20% ownership in the company, aligning management interests with shareholders. Ong founded FlexiRoam in 2011 and has over 20 years of experience in telecommunications, positioning him as a travel eSIM pioneer. The management team includes CFO Grant Wong, who previously led the A$300m IPO process for Credible (acquired by Fox) and worked in M&A at MA Financial, and Jonathan Kendall as Director of Strategic Partnerships, bringing 30+ years of telecom experience from Vodafone, Telstra, and Tata Communications.
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