Research Solutions Inc
RSSS
$2.93 -2.33%
Exchange: NASDAQ | Sector: Technology | Industry: Software Application
Q3 2024
Published: May 13, 2024

Earnings Highlights

  • Revenue of $12.12M up 17.2% year-over-year
  • EPS of $0.00 decreased by 71.6% from previous year
  • Gross margin of 42.7%
  • Net income of 76.30K
  • "ARR at the end of Q3 is $16.6 million, which means we're pacing a little behind that goal. However, this was largely due to the churn within the ResoluteAI business." - Roy W. Olivier
RSSS
Company RSSS

Executive Summary

Research Solutions Inc posted a solid QQ3 2024 performance driven by a meaningful expansion in annual recurring revenue (ARR) and a favorable revenue mix shift toward higher-margin platform offerings, even as the company contends with churn within the ResoluteAI portfolio. Total revenue reached $12.12 million for the quarter, up 17% year over year, with platform subscription revenue up 76% to roughly $4.0 million and ARR finishing at $16.6 million, up 82% YoY and 6% sequentially. The company generated $2.02 million of cash flow from operations and $0.96 million of adjusted EBITDA, marking a notable profitability and cash-flow improvement in the back half of the year after earlier one-time costs related to acquisitions and proxy matters. Net income was breakeven to modestly positive ($0.076 million) on GAAP, while GAAP gross margin rose to 45.2% (up 630 bps YoY) as revenue mix continues to tilt toward higher-margin platform revenues (which delivered >60% of gross profit on ~1/3 of revenue). Management highlighted ongoing integration efforts across Scite and ResoluteAI, cross-sell momentum into Article Galaxy, and a strategic path to a long-term ARR goal of $30 million by FY2026 (BHAG). The quarterly results benefited from cross-sell growth in Scite (B2C and B2B) and improved operational efficiency, while challenges persist from ResoluteAI churn concentrated among a few large customers. The guidance suggests Q4 will be seasonally weaker for transaction revenue but supported by continued B2C advertising and disciplined marketing spend, with an emphasis on achieving another solid adjusted EBITDA quarter and sustaining operating cash flow strength. Investors should monitor ARR progression, churn normalization in ResoluteAI, platform adoption in B2B/B2C, and the pace of profitability as Scite and Resolute integrations mature.

Key Performance Indicators

Revenue
Increasing
12.12M
QoQ: 17.47% | YoY: 17.15%
Gross Profit
Increasing
5.17M
42.69% margin
QoQ: 15.35% | YoY: 28.43%
Operating Income
Decreasing
109.84K
QoQ: 126.15% | YoY: -17.50%
Net Income
Decreasing
76.30K
QoQ: 242.28% | YoY: -67.78%
EPS
Decreasing
0.00
QoQ: 231.58% | YoY: -71.59%

Revenue Trend

Margin Analysis

Historical Earnings Comparison

PeriodRevenue ($M)EPS ($)YoY GrowthReport
Q1 2026 12.31 0.02 +1.5% View
Q3 2025 12,661.36 0.01 +104.0% View
Q2 2025 11.91 -0.07 +15.5% View
Q1 2025 12.04 0.02 +19.7% View
Q4 2024 12.13 -0.09 +21.8% View
Q3 2024 12.12 0.00 +17.2% View