⚠ Two-Fifths of the List, Every YearHigh threat

Text (TXT) — threat to the moat

At 4% a month the acquisition engine is not a growth strategy, it is life support - and both halves of it are being rebuilt at once.

Losing 4% of customers a month1 means the machinery that finds new ones is not optional equipment. It is life support.

The acquisition requirement4%customerslost monthly~38,7%of logos, per yearclosedtraditional sales dept-2,7%MRR, FY2026Both mechanisms that met the requirement are being rebuilt in the same year
At this churn the acquisition engine is not a growth strategy, it is life support.

The arithmetic is unforgiving. To stand still, Text must replace close to two-fifths of its LiveChat logos every twelve months; to grow, it must beat that and then some. For most of the company's life it did, comfortably — revenue went from 53 million złoty in the year to March 2016 to 354 million by 20252. The engine was self-serve signup fed by search traffic and marketplace listings, which is why the company never needed a large sales force and could run margins above 50%3.

Two things have now happened to that engine at once. Text closed its traditional sales department, moving the responsibility to the customer support team4. And it disclosed that traditional search engines are being replaced by language models and assistants, which may negatively affect the search-optimisation activity that brings its customers in5.

So the requirement is unchanged and the two mechanisms that met it are both being rebuilt in the same year. That is the most consequential thing in this company's filings, and it is not in the financial statements.

The result has already appeared once. Monthly recurring revenue fell 2,7% over the year to 6,93 million dollars6 — the first time the base has gone backwards — and the recovery reported in the following quarter came from raising prices on existing customers rather than from finding new ones7.

Watch new monthly recurring revenue added, not the total. The total can be lifted by price for exactly as long as there are legacy customers left to reprice.

References
  1. ReportedLosing 4% of customers a month means the machinery that finds new ones is not optional equipment.
    Text Group Management Board report for 2025/26, key performance indicators (monthly recurring revenue of USD 6,93m at 31 March 2026, down 2,7% year on year and 0,7% on December, giving annual recurring revenue of USD 83,12m; revenue in US dollars of 88,2m against 88,6m, down 0,5%; payments received of USD 87,9m, down 0,7%; Q4 dollar revenue of 22,56m, the highest since Q2 2024/25; a LiveChat customer churn rate of 4% on a monthly basis with net MRR churn described as significantly lower; LiveChat at 83,7% of group revenue with ChatBot 8,7% and HelpDesk with KnowledgeBase 7,5%; and an average USD/PLN translation rate 8,0% lower than the prior period) — FY2025/26 · publ. June 2026 · source ↗
  2. ReportedFor most of the company's life it did, comfortably - revenue went from 53 million złoty in the year to March 2016 to 354 million by 2025.
    Text Group Management Board report for 2025/26, margins, costs and cash (gross profit margin on sales of 67,6%, operating margin 38,6% and net margin 35,4%; cloud infrastructure costs rising, the migration completing in July 2025 after more than a year of duplicated cost, and completion not translating into cost reductions because of price increases regardless of provider and a deliberately expanded scope of purchased services; increased consulting, legal and public relations costs; fourth-quarter costs falling on cloud optimisation; a warning that more intensive use of artificial intelligence may cause further cost increases and that rising AI costs should press hardest on competitors offering free or freemium products; operating cash flow of PLN 161,6m and PLN 62,8m of cash; and a dividend policy of allocating the highest possible part of profit to shareholders) — FY2025/26 · publ. June 2026 · source ↗
  3. ReportedThe engine was self-serve signup fed by search traffic and marketplace listings, which is why the company never needed a large sales force and could run margins above 50%.
    Text Group Management Board report for 2025/26, margins, costs and cash (gross profit margin on sales of 67,6%, operating margin 38,6% and net margin 35,4%; cloud infrastructure costs rising, the migration completing in July 2025 after more than a year of duplicated cost, and completion not translating into cost reductions because of price increases regardless of provider and a deliberately expanded scope of purchased services; increased consulting, legal and public relations costs; fourth-quarter costs falling on cloud optimisation; a warning that more intensive use of artificial intelligence may cause further cost increases and that rising AI costs should press hardest on competitors offering free or freemium products; operating cash flow of PLN 161,6m and PLN 62,8m of cash; and a dividend policy of allocating the highest possible part of profit to shareholders) — FY2025/26 · publ. June 2026 · source ↗
  4. ReportedText closed its traditional sales department, moving the responsibility to the customer support team.
    Text Group Management Board report for 2025/26, corporate events (the Text App suite reaching first existing customers in June 2025 and opening on text.com in August, with the first new customers acquired organically in the following quarter; full migration of infrastructure to Google cloud servers in July 2025; SOC 2 Type 1 attestation in December 2025 and Type 2 in May 2026 audited by Sensiba, described as significant support in acquiring enterprise-class customers especially in the United States; Meta Business Partner status in January 2026; products introduced to the Microsoft marketplace in February 2026; a partnership with Golden Whale for the iGaming industry in April 2026; the closure of the traditional sales department with responsibilities assumed by the customer support team; the new visual identity and Go-To-Market campaign in May 2026; and the end of price grandfathering, with LiveChat Team and Business prices raised in September 2025, customers on older price lists notified in March 2026, monthly payers transferred from April 2026 and annual payers transferring as their subscription periods expire) — FY2025/26 · publ. June 2026 · source ↗
  5. ReportedAnd it disclosed that traditional search engines are being replaced by language models and assistants, which may negatively affect the search-optimisation activity that brings its customers in.
    Text Group Management Board report for 2025/26, risks and key factors (currency risk arising because revenue is generated in US dollars while a significant portion of costs is incurred in Polish złoty, affecting reported results and the dividend, with the company not hedging its open foreign exchange positions; competition risk from more innovative or cost-effective solutions and from rivals allocating far greater funds to development and promotion, and from AI changing how software is developed and marketed in a way that could erode the advantage derived from the company's technology and experience; distribution risk from the loss or reduced effectiveness of channels such as Google, Shopify or BigCommerce, and from traditional search engines being replaced by LLM models or AI assistants in a way that may harm the SEO activities of the company and its affiliate partners; product concentration risk, since Text generates almost all revenue from LiveChat products; and risk from entities using patents to enforce compensation) — FY2025/26 · publ. June 2026 · source ↗
  6. ReportedMonthly recurring revenue fell 2,7% over the year to 6,93 million dollars - the first time the base has gone backwards - and the recovery reported in the following quarter came from raising prices on existing customers rather than from finding new ones.
    Text Group Management Board report for 2025/26, key performance indicators (monthly recurring revenue of USD 6,93m at 31 March 2026, down 2,7% year on year and 0,7% on December, giving annual recurring revenue of USD 83,12m; revenue in US dollars of 88,2m against 88,6m, down 0,5%; payments received of USD 87,9m, down 0,7%; Q4 dollar revenue of 22,56m, the highest since Q2 2024/25; a LiveChat customer churn rate of 4% on a monthly basis with net MRR churn described as significantly lower; LiveChat at 83,7% of group revenue with ChatBot 8,7% and HelpDesk with KnowledgeBase 7,5%; and an average USD/PLN translation rate 8,0% lower than the prior period) — FY2025/26 · publ. June 2026 · source ↗
  7. ReportedMonthly recurring revenue fell 2,7% over the year to 6,93 million dollars - the first time the base has gone backwards - and the recovery reported in the following quarter came from raising prices on existing customers rather than from finding new ones.
    Text Group Management Board report for 2025/26, key performance indicators (monthly recurring revenue of USD 6,93m at 31 March 2026, down 2,7% year on year and 0,7% on December, giving annual recurring revenue of USD 83,12m; revenue in US dollars of 88,2m against 88,6m, down 0,5%; payments received of USD 87,9m, down 0,7%; Q4 dollar revenue of 22,56m, the highest since Q2 2024/25; a LiveChat customer churn rate of 4% on a monthly basis with net MRR churn described as significantly lower; LiveChat at 83,7% of group revenue with ChatBot 8,7% and HelpDesk with KnowledgeBase 7,5%; and an average USD/PLN translation rate 8,0% lower than the prior period) — FY2025/26 · publ. June 2026 · source ↗
Sources
Generated September 24, 2026