WiseTech Global Limited (ASX: WTC) saw its shares plunge 9.6% on Wednesday, closing at A$41.10, as investors reacted to a subdued revenue growth forecast for fiscal 2027. The stock touched an intraday low of A$40.80 before recovering slightly, according to market data. The decline erased approximately A$1.46 billion from the company's market capitalization, based on 333.43 million shares outstanding and Tuesday's closing price of A$45.47.
The market's disappointment centered on the company's guidance for the coming fiscal year. WiseTech projects fiscal 2027 revenue in the range of US$1.48 billion to US$1.54 billion, representing growth of just 6% to 10% year-over-year. This marks a dramatic deceleration from the explosive 79% revenue surge in fiscal 2026, which was driven largely by the acquisition of e2open, contributing US$541.2 million over 11 months.
Record Revenue but Profit Pressures
For fiscal 2026, WiseTech reported revenue of US$1.396 billion, a 79% increase from US$778.7 million in the prior year. However, statutory net profit declined 11% to US$178.7 million, down from US$200.7 million. The profit drop was primarily due to higher interest expenses and increased amortization of acquired assets, which offset gains in operating profit.
Underlying EBITDA rose 56% to US$644.5 million, but the underlying EBITDA margin contracted by seven percentage points to 46%. The company's cash generation remained robust, with underlying free cash flow up 67% to US$489.6 million. Net leverage stood at 2.7 times at the end of June.
Organic Growth and Efficiency Measures
Investors are now focusing on the sustainability of organic growth. CargoWise, the company's core platform, posted an 11% increase in revenue to US$756.9 million. With the one-time boost from e2open no longer available, organic expansion becomes critical for future performance.
Management emphasized cost discipline, highlighting annualized savings of US$115 million, including US$34 million attributed to its AI transformation initiatives. Over 95% of CargoWise clients have migrated to Value Packs, and new small-business agreements grew roughly 55%, though these metrics do not directly translate into revenue projections.
Analyst Sentiment and Market Reaction
Prior to the results, analysts were largely bullish, with sixteen maintaining Buy ratings and a consensus price target of A$65.16 in July. That target implies a 58.5% upside from Wednesday's closing price, but such projections are subject to revision following the updated outlook.
The stock's decline also sparked notable search interest, with "wtc asx" trending on Google Trends, reflecting investors' real-time reassessment of the company's valuation.
Risks ahead include potential declines in freight volumes, which could reduce transaction-based revenue. Integration delays, heightened regulatory scrutiny, or additional restructuring costs could further postpone the anticipated margin recovery.
The key question is execution: WiseTech must convert a 6%–10% increase in sales into a 12%–21% improvement in EBITDA, excluding the impact of another major acquisition step-up. The market's reaction suggests skepticism about the company's ability to achieve that leverage.