WiseTech Global Limited engages in the development and provision of software solutions to the logistics execution industry in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. It develops, sells, and implements software solutions that enable and empower logistics service providers to facilitate the movement and storage of goods and information.
WiseTech Global (WTC), was removed from the Discretionary portfolio on Friday while remaining a current holding in the ASX Growth Portfolio. WTC’s share price experienced a sharp decline in its share price on Friday, dropping 12.37%, paring back a larger initial loss of as much as 20%, after revising its full-year earnings guidance downward. This adjustment comes amidst scandals involving founder Richard White, which delayed a key product launch and raised investor concerns about governance and execution risks.
The company now forecasts earnings before interest, tax, depreciation, and amortisation (Ebitda) of A$600 million to A$660 million, a reduction from the previous range of A$660 million to A$700 million. This guidance is also below the average analyst estimate of A$684.5 million, reflecting a tempered growth outlook. Revenue projections have been similarly adjusted to A$1.2 billion to A$1.3 billion, down from the earlier range of A$1.3 billion to A$1.35 billion, while Ebitda margins are expected to fall between 50% and 51%, compared to the prior forecast of 51% to 52%.
The reduced guidance stems partly from the delayed commercial launch of Container Transport Optimisation, now expected in the second half of FY25. This delay, attributed to distractions caused by the media scrutiny and subsequent organisational changes, has temporarily disrupted WiseTech’s growth trajectory. While flagship products such as CargoWise Next remain on schedule, the deferral of new revenue streams has heightened near-term uncertainty.
Despite these challenges, WiseTech is widely regarded as a high-quality growth stock, boasting strong fundamentals, market-leading technology, and a robust long-term vision. Its ability to deliver innovative solutions in the global logistics space has historically driven significant shareholder value. However, the recent controversies and lowered guidance are likely to weigh on the stock’s performance in the short term. Investors may remain cautious until there is greater clarity on the company’s ability to execute its product roadmap and regain operational focus.
Richard White, who stepped down as CEO in October, has transitioned to a consulting role, retaining his visionary influence on the company. While the board has defended this decision, noting White’s unique ability to drive innovation, the leadership change adds an additional layer of uncertainty. An independent investigation cleared White of allegations related to undisclosed relationships and misuse of company funds, but the reputational impact and the restructuring of his role have not gone unnoticed by the market.
For investors, the path forward hinges on WiseTech’s execution in the coming quarters. While its long-term growth potential remains intact, the current combination of lower guidance and reputational concerns is likely to create headwinds for the share price. The company’s strong track record in logistics software innovation provides reasons for optimism, but near-term volatility could persist as the market reassesses its valuation amidst these developments. WTC remains a valid buy recommendation in the ASX Growth Portfolio.
