Irish-based spatial computing and metaverse technology company Engage XR said it expected to make a loss of €4.6 million for 2023, as some contracts and revenue are pushed out until early next year.
But the company said it had adequate funding to reach break-even in the short to medium term, and described 2023 has a “challenging and informative year”.
It has signed a number of deals with educational and financial clients. More than 15,000 enterprise and education customers now use the Engage Link platform.
Revenues are expected to be between €3.6 million and €3.8 million for the year, with recurring revenue from its Engage platform accounting for 65 per cent of that. Overall, Engage will make up 90 per cent of revenues for 2023, with the remainder coming from virtual reality experiences such as Titanic, Apollo and Shuttle Commander.
However, some contracts that Engage was hoping to sign in the current financial year are likely to be pushed out to the first quarter of 2024, and the Lenovo hardware partnership is also expected to yield benefits next year, with the ThinkReality VRX headset due to be relaunched in at the CES show in January.
“2023 has been a very valuable year for gathering data on the true value proposition of ENGAGE to our customer base. We are seeing a move away from our historic offering of one-off remote events with a focus on driving our recurring revenue model with encouraging progress being made in the education, training and development verticals,” said David Whelan, chief executive of Engage XR. “In a marked change in 2023 education, training and development revenue now comprise a bigger percentage of overall Group revenue compared to enterprise revenue whereas in 2022 enterprise revenue was almost double that of education, training and development.”
Mr Whelan said education-based customers had shown they were willing to invest heavily in the technology to take advantage of better educational outcomes and less time needed to train employees.
“We continue to focus on these sectors as core opportunities for the group and are hopeful that our pipeline in these verticals will deliver good contract wins during FY 2024,” he said.
The company has kept costs under control and is making moves towards becoming cash flow positive.
“We are going to finish the year with a strong cash balance and, based on the opportunities before us, we can see a clear path to profitability,” Mr Whelan said.
“Up to now ENGAGE has been the build anything you wish platform in a similar way to Wordpress for website development. We have had a broad and varied user base over the past three years which has enabled us to see what works and more importantly what doesn’t. We now have a clear and visible customer base who are growing with us and this is where our focus will be for 2024 and beyond.”
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