Half year 2026 results

21 May 2026

Download the full press release (PDF)

Accelerating growth driven by execution of AI strategy 

Steve Hare, Chief Executive Officer, commented:

“Sage delivered an excellent first-half performance, with double-digit revenue growth, further margin expansion and strong cash flows. This reflects the focused execution of our strategy and a deep understanding of our customers’ needs.   

“Small and mid-sized businesses trust Sage to run their mission-critical finance, payroll and HR workflows, where accuracy and compliance are non-negotiable. Our intelligent agents are already helping finance teams accelerate cash flows, close the books faster, plan more effectively and turn insight into action, without compromising control or accountability.   

“By embedding AI directly into our customers’ day-to-day work, we are making our solutions more valuable, reinforcing our competitive advantages, and driving efficient, sustainable growth.  

“With our trusted scalable platform, growing agent portfolio and strong momentum supported by investment across the business, I am confident in Sage's ability to deliver growth and long term value for all stakeholders.” 

_{Please note that tables may not cast and change percentages may not calculate precisely due to rounding.}

Financial highlights

• Underlying total revenue increased by 11% to £1,363m, reflecting broad-based growth across the business underpinned by strength in cloud solutions.  
• Underlying operating profit grew by 15% to £326m, driving a margin increase of 80 basis points to 23.9%, with disciplined cost management supporting increased investment. 
• Underlying EBITDA increased by 14% to £375m, with margin also increasing by 80 basis points to 27.6%. 
• Statutory operating profit increased by 15% to £293m reflecting growth in underlying operating profit. 
• Underlying basic EPS increased by 16% to 23.7p, whilst statutory basic EPS increased by 14% to 20.7p.  
• Strong cash performance, with underlying cash conversion of 116%, reflecting continued growth in revenue and good working capital management. 
• Robust balance sheet, with £1.1bn of cash and available liquidity; net debt to underlying EBITDA of 2.0x. 

Shareholder returns

• Interim dividend up 8% to 8.05p, in line with our progressive policy. 
• Share buyback programme of £300m announced in March 2026 is well underway, taking the total value of share buybacks announced in the first half to £600m. This reflects Sage’s strong cash generation, robust financial position, and the Board’s confidence in Sage’s future prospects. 

Strategic and operational highlights

• Underlying annualised recurring revenue (ARR) up 11% to £2,727m, with growth across all regions balanced between new and existing customers.  
• Renewal rate by value of 102%, ahead of last year (H1 25: 101%), reflecting higher sales to existing customers, including the growing adoption of AI-powered features, supported by strong retention rates. 
• Sage Business Cloud revenue increased by 15% to £1,162m (H1 25: £1,011m), including cloud native revenue growth of 25% to £518m (H1 25: £416m). 
• Strong growth across our cloud products, particularly Sage Intacct, supported by investment in our product and go-to-market capabilities together with the focused execution of our AI strategy. 
• Embedding AI into core customer workflows, with the launch of intelligent agents and the expansion of Sage Copilot delivering tangible productivity and decision-making benefits for customers. 
• Leveraging the Sage Platform to extend our ecoystem, supporting broader innovation and scale, alongside the acquisitions of Criterion, Akao and Doyen AI³.  
• Success in acquiring small business customers earlier in their lifecycle through Sage Sole Trader and our embedded services partnerships with major UK banks and fintechs. 
• Accelerating productivity through the adoption of AI across our own operations, with significant benefits in areas including engineering, customer support, sales and marketing.  

Outlook

Building on strong momentum in the first half, we now expect organic total revenue growth for FY26 to be above 9%. We continue to expect operating margins to trend upwards in FY26 and beyond, as we focus on efficiently scaling the Group. 

About Sage

Sage exists to knock down barriers so everyone can thrive, starting with the millions of small and mid-sized businesses (SMBs) served by us, our partners and accountants. Customers trust our finance, HR and payroll software to make work and money flow. By digitalising business processes and relationships with customers, suppliers, employees, banks and governments, our AI-powered network connects SMBs, removing friction and delivering insights. Knocking down barriers also means we use our time, technology and experience to tackle digital inequality, economic inequality and the climate crisis. 

A presentation for investors and analysts will be held at 8.30am UK time. The webcast can be accessed via sage.com/investors or directly via the following link: https://edge.media-server.com/mmc/p/xk88y5dc. To join the conference call, please register via https://register-conf.media-server.com/register/BI508df57c7ecd4e03ae86026254ec15c0.

¹See Appendix 1 for full definitions and guidance on the usage of the Alternative Performance Measures.

² To aid comparability, underlying and organic measures for the prior period have been retranslated at current period exchange rates and exclude recurring and non-recurring items, while organic measures also adjust for the impact of acquisitions and disposals. A reconciliation of underlying and organic measures to statutory measures is set out on pages 6 and 7. Underlying and organic measures are defined in Appendix 1. 

³ Criterion was acquired in October 2025, Akao in January 2026, and Doyen AI in April 2026.

All references to revenue, profit and margin are on an underlying basis unless otherwise stated.