Dotdigital Group (LSE:DOTD) has told investors that it ended its 2026 financial year with Revenue up 8% and forward-looking contracted annual Recurring Revenue up 18%. In its FY26 trading update, the Marketing technology company said performance was in line with market expectations and that it enters FY27 with better revenue visibility.

What the company does

Dotdigital Group plc provides a customer experience data platform used for email and multichannel marketing automation. Its core business, known as CXDP, drove most of the growth in recurring revenue. LSE:DOTD has widened its offering through acquisitions, including Alia and Social Snowball. The shares trade on AIM under the ticker DOTD.

The FY26 trading update

Revenue was £90.9m, up 8%. Forward-looking contracted annual recurring revenue rose 18% to £85.4m. Recognised recurring revenue rose 14% to £76.8m, representing 84% of group revenue. Cash was £17.1m after the Acquisition of Alia.

Acquisitions

The company reported that annual recurring revenue at Alia grew 45% and at Social Snowball 33% during the periods they have been owned. These small acquisitions add AI-related and customer-engagement capabilities to the core platform.

Outlook

Management said it enters FY27 with greater confidence in meeting market expectations. LSE:DOTD is expanding its AI-enabled offering and strengthening go-to-market execution. The mix of a larger forward contracted base than recognised recurring revenue suggests that growth in committed contracts is running ahead of revenue already booked, which is a positive indicator, although it does not ensure future results.

Earlier updates

In January 2026 the company issued a trading update together with a notice of half-year results.

Financial and Dividend picture

Readers wishing to assess earnings, margins and any Shareholder distribution should consult the full results announcement.

Sector and index context

Dotdigital (LSE:DOTD) is one of the larger software businesses in the FTSE AIM All Share Index. Marketing automation is a crowded field, with global platforms competing against specialist providers, and customers increasingly expect artificial intelligence features. Subscription-style revenue is attractive because of its predictability, yet software firms are sensitive to customer retention, pricing pressure and the pace at which clients expand their marketing budgets.

Reading the numbers

Group revenue grew 8% while contracted annual recurring revenue grew 18%, so contracted Business is expanding faster than reported sales. Recurring revenue made up 84% of the total, which gives a high degree of visibility compared with project-based software groups, though contracts can be cancelled at renewal.

Key risks

Competition from larger marketing platforms and the cost of keeping pace with AI development are the main strategic risks. Acquisitions bring integration risk, and the reported growth rates for Alia and Social Snowball cover limited periods. Dependence on marketing budgets means weaker economic conditions could slow new business. Currency movements can also affect reported revenue for a group with international customers.

What to watch next

The next milestones include the full-year results for FY26, which should add profit, Margin and dividend detail, and any trading update for the first half of FY27. Investors will also track further acquisitions, progress with AI products and whether contracted annual recurring revenue continues to outpace recognised revenue.