Cerillion Stock And 2 UK AI Software Shares With Recurring Revenue

Artificial intelligence is at the centre of nearly every market conversation right now, from central bank decisions and bond yields to energy prices and trade flows. While inflation signals are mixed and interest rate paths remain data driven, AI spending has become a consistent priority for many companies seeking productivity gains and new revenue streams. The AI Stocks screener focuses on businesses directly linked to this trend, including semiconductors, software, large language models, ChatGPT related tools and cloud infrastructure. In this article, you will see 3 of the most closely watched stocks from this screener and why they stand out today.

Cerillion (AIM:CER)

Overview: Cerillion is a London based software company that supplies telecom operators and subscription businesses with billing, charging and customer relationship management platforms, including pre packaged SaaS solutions for everything from quad play communications providers to smart cities.

Operations: Cerillion generates most of its revenue from Software at £22.6m, followed by Services at £17.8m and Other income of £2.0m.

Market Cap: £310.2m

Cerillion brings together high margin telecom billing software, AI powered analytics and long term contracts at a time when operators are looking for automation and better monetisation. This helps explain its strong 5 year earnings growth of 19% a year and solid 22.6% ROE, even though the latest half year showed lower revenue and profit. The company is actively pushing into agentic AI for complex networks and has secured projects like Omantel’s major BSS/OSS overhaul, while still returning cash through a higher interim dividend. Investors do need to weigh governance flags, such as limited board independence and high non cash earnings, but these sit alongside analyst expectations for continued earnings growth and a clear focus on AI driven telecom software.

Cerillion’s mix of AI powered analytics, long term telecom contracts and dividends can look tightly aligned, but the real tension sits in how those strengths stack up against governance concerns in the 2 key rewards and 1 important major warning sign

Bytes Technology Group (LSE:BYIT)

Overview: Bytes Technology Group is a UK based IT reseller and services company that helps organisations buy and manage software, cloud, AI and cyber security solutions, alongside the hardware like servers and laptops needed to run them. It also supports customers with training, consulting and software asset management so they can deploy these technologies efficiently and keep costs under control.

Operations: Bytes Technology Group generates £220.6m of revenue from its IT solutions provider activities, with £211.9m from the United Kingdom and the remainder from Europe and the rest of the world.

Market Cap: £964.5m

Investors looking at AI and cloud themes may find Bytes Technology Group interesting because it sits at the crossroads of software licensing, security and public sector IT spending. The company is pushing into higher margin areas such as cyber security and AI focused software, while investing in new systems and a customer marketplace that could make it easier to win and service large contracts. At the same time, guidance for flat operating profit, pressure on margins from lower margin public contracts and reliance on renewals highlight that execution is important here. The mix of high ROE, buybacks and board refresh means Bytes is a business where understanding the full risk reward picture could be time well spent.

Bytes Technology Group sits where high margin AI software, cyber security and large public contracts intersect, yet the full picture of its risk and reward profile is not obvious from the headlines alone. As a result, the 3 key rewards and 1 important warning sign could be the key missing context investors are looking for.

AdvancedAdvT (AIM:ADVT)

Overview: AdvancedAdvT provides software for business management, healthcare compliance and human capital management, alongside financial management and workforce planning tools. It also runs a machine learning based intelligent process automation platform. Its products are used across the United Kingdom, Europe, North America and other regions, serving organisations that want to streamline complex workflows and data heavy operations.

Operations: AdvancedAdvT generates all of its £53.4m in revenue from Internet Software & Services, with the entire amount currently coming from the United Kingdom.

Market Cap: £207.9m

AdvancedAdvT blends exposure to healthcare and workforce software with a machine learning automation platform. This helps explain why some investors are willing to pay a premium P/E even as net income fell from £10.88m to £4.61m after a £5.6m one off loss. Forecast earnings growth of around 32% a year and revenue of £53.4m describe a business that analysts expect to scale. However, the 8.6% margin, low 3% ROE and heavy reliance on external borrowing mean the balance sheet deserves close attention. For investors who focus on AI backed software and want to understand whether the current valuation reflects both upside and funding risks, AdvancedAdvT is a stock that invites a deeper look.

AdvancedAdvT’s premium P/E, machine learning platform and £53.4m revenue suggest a story still forming, but the tension between growth ambitions and funding risk in the analyst forecasts for AdvancedAdvT may reveal an unexpected twist

The three AI focused stocks in this article are only a starting point, with the full Artificial Intelligence/ AI Stocks screener uncovering 15 more companies that each carry their own compelling AI driven narratives. Use Simply Wall St to identify and analyze the specific catalysts mentioned here, from chip demand and cloud capacity to LLM software and enterprise AI adoption. This can help you filter the field down to the highest conviction opportunities.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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