Monitise, the mobile banking and payments service, yesterday downgraded its revenue growth forecasts for the second time this year, as its business model shifted.
The Aim-listed company said it expected revenue for the financial year to be between £95m and £97m, equating to revenue growth of between 31 and 33 per cent, down from its previous estimate of 40 per cent revenue growth.
Monitise, which had previously expected revenue growth of 50 per cent for the year before its first downgrade to 40 per cent in March, blamed the further slowdown in expected revenue growth on a faster shift by customers to its subscription model, hitting up-front revenue.
The company also stated that revenue growth would have been on target if a small number of larger contracts for its subscription service had been completed by 30 June, as it had previously expected.
It expects revenue growth in 2015 to be at least 25 per cent, and to reach profitability in 2016, with a target of 200m registered users by 2018.
Monitise co-chief executive Elizabeth Buse, who joined the company last month, said: “As a business we are committed to the next step of our journey and transitioning to a subscription-based model. Having taken the decision to forego certain shorter-term licence revenue in favour of longer-term subscription revenue, our priorities for the year ahead are executing on the strategy we are now aggressively pursuing.”
Monitise, which was founded by co-CEO Alastair Lukies in 2003, has seen strong uptake for its services, with hundreds of companies including RBS and Visa using its technology.
It has operations in the UK, USA, India, Hong Kong and Indonesia, with 30m registered users making payments and transfers of $88bn (£51bn) annually using its service.
Its shares fell 8.6 per cent yesterday to finish on 45p.