Oxford Metrics has slashed its guidance for the rest of the financial year as the smart sensing and software company warned on the ‘greater caution’ it was seeing among customers.

The Yarnton-based business warned its full-year pre-tax profits would come in “materially below” current market expectations of £7.8m, while it cut back expected revenues of £48.6m to within the range of £40m-£42m.

“While the Group continues to have a healthy pipeline, the trend of more extended buying cycles has developed in the second half,” the company said.

“Globally, we are seeing customers across our markets exercising greater caution and purchasing decisions are taking longer to conclude. A number of opportunities in the pipeline have now shifted into the new financial year.”

The firm said its entertainment division had been “impacted by the ongoing slowdown in the global games industry and subsequent content creation contraction,” adding its life sciences business was expected to be “slightly behind” the prior year’s figure of £14.8m.

Oxford Metrics shares sunk 23% to 60p in the opening minutes of trade in London. The company’s stock has fallen by more than 40% since the start of the year.

The results come as a blow to Oxford Metrics’ new CEO Imogen Moorhouse, barely a year into the role after it was unveiled in July last year that the former Vicon chief would succeed the long-serving former boss Nick Bolton, who quit to become the next CEO of national mapping agency Ordnance Survey.

Oxford Metrics said it continued its hunt for more M&A opportunities, fuelled by a £50m cash war chest, in a bid to drive more applications in the smart manufacturing market following its £8.1m acquisition of Industrial Vision Systems in November last year.

The company is due to publish its full-year results on Tuesday, 3 December.