Churn pushes iomart’s expected earnings just below forecasts
The cloud provider to SMEs and the mid-market is growing in lower-margin work while churn hits higher-margin services. Its finance chief is also leaving
- Annualized cost savings achieved so far: more than £5m, according to iomart
- Analysts’ revenue range for the year: £157.6m to £159.1m
- Analysts’ net debt range at year end: £98m to £107m
- Staff: more than 600, according to the company
Customers on iomart’s private cloud and hosting services are dealing with a supplier whose growth now comes from Microsoft-based work. That can mean pressure to migrate, or firmer pricing on legacy platforms at renewal. Anyone with a renewal due should ask for a written roadmap for the services they depend on, check exit and data-return terms, and price the alternatives before committing to a longer term.
“On behalf of the Board and the wider iomart team, I wish to thank Scott for his significant commitment and contribution to iomart over the last seven years and wish him every success in his new role.”Richard Last, executive chair, iomart Group
AIM-listed cloud services company iomart said on 11 February 2026 that it expects adjusted earnings before interest, tax, depreciation and amortization (EBITDA) for the year to 31 March 2026 to land just below the lower end of market expectations, where analysts’ range was £27.7m to £28.5m. It expects revenue to be broadly in line with the bottom of forecasts.
The company says trading softened in December and January, with customer churn rising compared with the earlier part of the year, particularly in certain high-margin areas. Growth came in Azure, security and Microsoft 365, where margins are traditionally lower, and was below what iomart had expected. It still expects net order bookings to be positive for the year.
The warning follows half-year results in November 2025 in which revenue rose 25% to £77.7m, including £21.7m from Microsoft partner Atech, while revenue from the pre-existing business fell by about £6m. Its largest unit, Iomart Cloud Services, which runs private cloud, backup and data center services, saw revenue drop to £44.5m from £49.4m after higher churn in the prior year, with self-managed infrastructure revenue down 24%. Net debt stood at £109.6m at 30 September 2025. The company describes its aim as becoming the UK’s leading provider of secure cloud services for SMEs and the enterprise mid-market.
Chief financial officer Scott Cunningham has told the board he will step down to join a private company outside the IT sector. He is expected to leave in June 2026, after more than seven years at iomart, and the search for a successor has started.
Sources
- iomart Group, “Directorate Change and Trading Update”, RNS, 11 February 2026. https://www.investegate.co.uk/announcement/rns/iomart-group--iom/directorate-change-and-trading-update/9424677
- iomart Group, “Half Yearly Results”, RNS, 26 November 2025. https://www.investegate.co.uk/announcement/rns/iomart-group--iom/half-yearly-results/9257250
