Sage (LSE:SGE) delivered strong first-half results for the six months ended 31 March 2026, supported by continued momentum in its cloud-based software operations and expanding adoption of AI-enabled products. Underlying revenue increased 11% to £1.36 billion, while operating profit rose 15% alongside further margin expansion, reflecting broad-based demand growth and disciplined cost management.
Annualised recurring revenue climbed 11% to £2.73 billion, with recurring income now accounting for 97% of total group revenue. Revenue generated from Sage Business Cloud advanced 15%, driven by new customer additions and increased uptake of AI-powered capabilities across the platform.
The software group said it is continuing to integrate artificial intelligence into key finance, payroll and HR workflows through products including Sage Copilot and a range of intelligent automation agents. Management noted that these technologies are contributing to stronger customer retention and supporting accelerated growth in products such as Sage Intacct across North America, the UK & Ireland, and Europe.
Supported by strong cash generation and a solid balance sheet, Sage has also expanded shareholder returns through higher dividends and additional share buybacks. Reflecting the company’s performance and trading momentum, management upgraded its full-year guidance and now expects organic total revenue growth to exceed 9% for the year.
Sage said its strategy remains focused on strengthening its position within the small and medium-sized business software market through cloud-native applications and embedded AI functionality designed to improve customer productivity, compliance and cash flow management.
The company’s broader outlook continues to benefit from strong recurring revenue growth, improving margins and positive earnings momentum. However, these strengths are partly offset by weak technical indicators and a valuation that remains relatively elevated on a price-to-earnings basis despite offering a moderate dividend yield.
More about Sage Group plc
Sage Group plc is a global provider of finance, payroll and human resources software for small and medium-sized businesses. Through its Sage Business Cloud platform, the company delivers cloud-native and cloud-connected applications that help businesses manage accounting, payroll, compliance and operational workflows, increasingly enhanced by AI-driven automation and productivity tools.
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