Inzisoft "Expanding Subscription Service Sales... Strengthening Earnings Stability"

CognitiveSoft, an AI-based image data specialist company, announced on the 28th that it is enhancing its performance stability by expanding the proportion of subscription-based and maintenance service sales.

As of the first half of this year, CognitiveSoft's maintenance sales accounted for 37% of consolidated sales, up 12 percentage points from 25% in the same period last year. Meanwhile, the proportion of one-time project sales decreased from 75% to 63%. The company explained that despite a decline in overall size due to the economic downturn, maintenance sales, which have higher performance stability, have increased.

Generally, one-time project sales have higher revenue per contract but are greatly affected by seasonality and economic fluctuations. In contrast, maintenance and subscription services generate stable sales every year. Additionally, they require relatively fewer personnel input for service provision, enabling higher profit generation compared to project sales.

The proportion of CognitiveSoft's maintenance service sales has been increasing annually. Maintenance sales accounted for 23% in 2022 and increased to 26% last year. This year, with the full-scale revenue generation of the cloud-based electronic document subscription service 'Q Service,' the proportion of regularly billed sales is expected to increase further.

A company representative stated, "Typically, paid maintenance services are provided from the second year after project completion," adding, "We are actively working to reduce the proportion of project sales, which have high performance volatility, and expand maintenance and subscription services that can generate stable profits."

Meanwhile, on the 13th, CognitiveSoft signed a business agreement with Naver Cloud, a leading domestic cloud service provider, to collaborate on the Q Service business. Q Service is a cloud-based subscription service that allows product explanations, subscriptions, and other processes to be handled electronically anytime and anywhere. Currently, Hanyang Securities, IBK Investment & Securities, and Meritz Securities have subscribed to the service and are utilizing it for digital counters and outside sales (ODS).