Shares of the ASX-listed WiseTech Global Limited (AU:WTC) plunged by nearly 12% as of writing after the company cut down its earnings guidance for FY25. The company now projects FY25 revenue between AU$1.2 billion and AU$1.3 billion, down from the earlier forecast of AU$1.3 billion to AU$1.35 billion. Additionally, EBITDA (earnings before interest, tax, depreciation, and amortization) guidance has been reduced to AU$600-AU$660 million, down from AU$660-AU$700 million. The downgrade was mainly due to delays and disruptions from organizational restructuring.
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WiseTech Global offers cloud-based software solutions focusing on end-to-end logistics management.
WiseTech Global Releases Board Review
WiseTech also released its board review on the media allegations against its founder and CEO Richard White. Last month, the stock plunged 15% in a single day after the company announced the review to look into this matter. The review was launched after the Australian Financial Review (AFR) reported allegations against White involving his personal life, including claims of payments to a former sexual partner.
However, after the review, the company cleared him of bullying and intimidation allegations. The law firms that examined allegations, including alleged misuse of company funds, found no evidence of wrongdoing.
WiseTech Downgrades Guidance on Restructuring
WiseTech attributed the earnings downgrade to distractions from recent media scrutiny of White’s conduct and subsequent organizational changes. Additionally, after assessing the progress of its key products – CargoWise Next, Container Transport Optimization, and ComplianceWise – the company has deemed it necessary to revise its FY25 guidance.
Although ComplianceWise was launched as planned in the first quarter of FY25 and CargoWise Next is largely on track, the launch of Container Transport Optimization has been delayed. The launch is now expected in the second half of FY25.
Is WiseTech Global a Buy?
According to TipRanks’ rating consensus, WTC stock has a Hold rating, backed by four Holds and one Buy recommendation. The WiseTech Global share price forecast is AU$96.96, indicating a downside of 20.7% from the current level.
