Corero - bounces back with 42% growth and Tier-1 contract win
Shares in technology business Corero Network Security (AIM: CNS) have surged by 12% to 9.25p this morning on a positive first half trading statement.
Corero is a leading provider of distributed denial of service (DDoS) protection solutions, specialising in automatic detection and protection solutions with network visibility, analytics, and reporting tools. A DDoS attack is a malicious attempt to crash or slow down a website, server, or network by flooding it with fake traffic.
Corero provides an important service as DDoS attacks can be very costly for businesses. KPMG estimates that the average cost of a significant cyber-attack for an individual business in the UK is almost £195,000, which when scaled to an annual UK cost amounts to £14.7 billion. Corero's technology protects users against external and internal DDoS threats in complex edge and subscriber environments, ensuring internet service availability.
Strong revenue growth
For the six months to end-June 2026 revenues grew by 42% to $15.5 million, driven by a combination of a strong annual recurring revenue (ARR) base, renewals and upsells with existing customers, and continued new customer wins, with a 14% increase in order intake to $14.3 million. In addition, the company experienced high renewal rates of 96% for its multi-year, subscription-based and DDoS Protection as-a-Service (DDPaaS) products. Meanwhile, a successful conversion of the healthy sales pipeline across H1 2026 was further enhanced by a continued improvement in ARR, which grew by 12% to $24.1 million.
Combined with gross margins increasing from 91% to 93%, the revenue performance is expected to deliver a significant improvement in EBITDA for the half to c.$2.6 million. That compares with a loss of $1.4 million for H1 2025 and ahead of the $1.5 million EBITDA posted for the whole of the last financial year. Adjusted EBITDA for H1 is expected at $2.7 million (vs a $1.3 million loss in H1 2025) excluding share-based payments.
On the balance sheet, cash stood at $2.1 million at the period end, down from $4 million six months earlier, but with no debt. Corero continues to navigate what it calls a “changing cashflow profile”, which was experienced in FY 2025 as a result of customers buying more subscription services than up front products. To assist with cashflow management a $2 million overdraft facility has been put in place but it remains unused.
Carl Herberger, CEO of Corero, said, “…we are confident in delivering continued growth in H2." We note that back in February this year it was announced that Herberger bought 138,000 shares in the company, taking his holding to 0.36%.
Big contract win post period end
Further success has been experienced into the second half of the financial year, with Corero securing a $1.4 million, 3-year new customer contract with a notable (but un-named) Tier-1 US service provider that is a leader in global telecommunications solutions. By successfully collaborating with one of Corero's strategic partners and following an extensive procurement process including a number of competitor DDoS solution providers, the Corero solution was selected, reflecting the competitiveness of Corero's solution in a global market. The company said that this contract win demonstrates strong market demand for its solutions, and a significant endorsement of the strength and maturity of its product offering, protecting and supporting a leading global Tier-1 service provider.
Corero Network Security 5-year share price chart
At the current price of 9.25p Corero is capitalised at £47.4 million. Investors will be welcoming this overall positive statement, especially since last year’s first half trading update contained a profit warning. We look forward to the release of the full interim results in mid-September where we will be looking out for how the new business pipeline is progressing.
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Disclosures
Corero Network Security is not a corporate client of Optimo Research Ltd.
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