Sage Group plc (LON:SGE), a leader in accounting, financial, HR and payroll technology for small and mid-sized businesses, has issued a trading update for the three months ended 31 December 2025[i].
Jacqui Cartin, Chief Financial Officer, commented:
“Sage delivered a strong start to FY26, with Q1 organic revenue growth accelerating to 10%, supported by the continued execution of our growth strategy. We are investing in innovation across our AI-powered platform, helping small and mid-sized businesses solve their day-to-day challenges and work more productively. We reiterate our full-year guidance, as set out in our FY25 results announcement, and remain focused on driving efficient, sustainable growth and long-term value for all stakeholders.”
| Underlying Revenue Performance[ii] | Q1 26 | Q1 25 | % Growth | Organic % Growth |
| Total Revenue | £674m | £610m | +10% | +10% |
| of which Sage Business Cloud | £574m | £500m | +15% | +14% |
| Total Revenue by Region | ||||
| North America | £304m | £268m | +13% | +12% |
| UKIA | £194m | £177m | +10% | +10% |
| Europe | £176m | £165m | +7% | +7% |
Total revenue increased by 10% to £674m in the first quarter, with all regions performing well.
In North America, revenue increased by 13% to £304m, with a strong performance from Sage Intacct together with continued growth in Sage 200 and Sage 50. In the UKIA region, revenue grew by 10% to £194m, driven by the rapid scaling of Sage Intacct alongside continued growth in small business solutions, including Sage Accounting and Sage 50. In Europe, revenue increased by 7% to £176m, with good growth across our accounting, HR and payroll solutions.
Sage Business Cloud revenue increased by 15% to £574m, driven by balanced growth from both new and existing customers, including cloud native revenue growth of 24% to £253m (Q1 25: £205m).
Recurring revenue grew by 10% to £655m (Q1 25: £593m), reflecting continued momentum in Annualised Recurring Revenue (ARR) during the quarter. Software subscription revenue grew by 12% to £568m (Q1 25: £507m) resulting in subscription penetration of 84% (Q1 25: 83%).
On an organic basis (excluding the impact of M&A), total revenue increased by 10% to £673m (Q1 25: £612m), while recurring revenue increased by 10% to £654m (Q1 25: £594m).
Foreign exchange
Sterling strengthened against the US dollar and weakened against the Euro, leading to a broadly neutral exchange rate impact at the Group level.
Analyst and investor conference call
Steve Hare, Chief Executive Officer, and Jacqui Cartin, Chief Financial Officer, will hold a webcast and conference call today at 8.30am UK time. The webcast can be accessed via the following link: https://edge.media-server.com/mmc/p/kzk8bxor To join the conference call, please register via:
https://register-conf.media-server.com/register/BI19edc6b6c5a944038f431d023f7ebc63
[i] All figures are on an underlying basis unless otherwise stated.
[ii] Underlying and organic results are presented on a constant currency basis, while organic growth also excludes the impact of M&A. Underlying and organic measures are defined on page 261 of Sage Group’s FY25 Annual Report.
