Ingenta refocuses on AI as largest customer cuts contracts

Ingenta, the Oxford publishing software group, said on 12 November that two contracts with its largest customer will not be renewed when they expire into 2027. The contracts account for about £2m of 2026 revenue. In the same announcement the AIM-listed company said it would refocus its strategy around AI, appointed a deputy chairman to drive that work and brought in an interim chief operating officer.

The customer is not named. Ingenta said it uses one of the group’s legacy platforms, had told the company of its intention to move, and has now confirmed it will do so at the end of 2026. Ingenta’s revenue for the whole of 2025 was £10.3m. Proactive reported that the shares fell 16% on the morning of the announcement.

The board’s response starts with costs. It said it “has made plans for a rapid refocusing of the Group’s operations”, to be implemented with immediate effect, which will reduce operating costs into 2027 and beyond. It expects efficiency savings and the AI-based refocusing to largely offset the lost contracts in 2027. The announcement puts no figure on the savings.

Brown’s AI remit

Dr Dan Brown becomes deputy chairman with immediate effect. He joined the board as a non-executive director on 6 August, when Ingenta took a 24.9% stake in FirstAida, the AI legal software company he founded and chairs. Ingenta said he will be “directly engaged in AI transformation, with a remit to apply this across every aspect of the business”.

Greg Healey joins as interim chief operating officer on a consultancy basis to lead the execution. Scott Winner remains chief executive and Martyn Rose chairman. The announcement describes the management team as interim and says it “has been and will continue to be strengthened”.

“The market for publishing software is evolving and the Board believes now is the right time to accelerate Ingenta’s development,” Rose said. He said the experience of the interim management team, the addition of FirstAida and Brown’s new role gave the group a strong platform for its next phase.

Brown’s remit covers what Ingenta sells and what it costs to run. For its publishing platforms the company lists metadata extraction, automated content summaries, multilingual search and content discovery as AI features. Inside the business, AI is to be used to modernize the code beneath the legacy products and to reduce the cost of service delivery. Those legacy products are the ones customers have been leaving.

Legacy customers moving on

The loss had been signaled. In a trading update on 25 June, Ingenta said some longer-term customers on its legacy platforms had been seeking to move to global suppliers of enterprise software platforms, and that some of the larger ones had asked for shorter contracts, which put revenue from 2027 at greater risk. Winner said in that update that the company had secured more than £2m of new business since the start of the year.

Those wins are contract values spread over three years. The two contracts now ending brought in a similar sum in 2026 alone, so the new business replaces only part of what is going each year.

In interim results on 23 September, gross margin fell to 48% from 51% a year earlier as the group moved away from what it called “traditionally higher margin legacy business”.

The FirstAida option

FirstAida makes AI software that helps rights holders investigate unauthorized use of their content, including the training of AI models on it. Ingenta has an option to buy the rest of the company in shares between May and November 2027. The option depends on FirstAida reaching annual recurring revenue of at least £375,000, a condition Ingenta can waive. The remaining shares are held by Management Refined, a company Brown owns.

In August FirstAida had minimal revenue. Ingenta now says several customers are engaged on a pre-revenue basis and that it expects FirstAida’s first commercial contracts in the fourth quarter of 2026. The August announcement said FirstAida is aimed at smaller and mid-sized rights holders and their legal advisers, a market Ingenta described as well aligned with its own customers.

The group goes into the change without debt. It had cash of £4.6m at 30 June, and Rose said more than 90% of the revenue that remains is recurring. Adjusted EBITDA for 2026 is in line with market expectations, the company said, and revenue broadly so.

Ingenta has named the people who will run the change and the date the lost revenue stops. The size of the savings and the decision on the rest of FirstAida are still to come, and Rose said the board looks forward to updating shareholders on its progress.