The Marygold Companies Inc (MGLD) delivered Q2 2025 revenue of $8.00 million, marking a -5.36% year-over-year decline but a modest +1.19% sequential uptick. Gross profit reached $5.93 million, yielding a robust gross margin of approximately 74.1%, underscoring the asset-light, fee-based component of the business. However, operating performance remained unprofitable, with operating income at -$1.83 million and EBITDA at -$1.68 million, driven by elevated operating and SG&A costs that outpaced revenue gains. Net income stood at -$1.75 million with an EPS of -$0.0428, compressing profitability and posing continued earnings risks in the near term.
The balance sheet shows a solid liquidity position, including cash and short-term investments totaling roughly $14.9 million against total liabilities of about $9.65 million, and a stockholders’ equity base of $23.35 million. Net debt remains negative (-$0.41 million), signaling modest leverage and a cushion to fund near-term operating needs. Free cash flow was negative at -$0.776 million, reflecting ongoing cash burn in operations and modest investing activity. The company’s current ratio of 2.77 and quick ratio of 2.50 point to healthy short-term liquidity, though profitability and cash generation require improvement to support sustainable equity value.
Without a disclosed management outlook in the data provided, the QQ2 2025 results suggest a path of stabilizing revenue with continued margin discipline and cost management as critical catalysts for a turn toward positive earnings and cash flow. Investors should monitor AUM-related growth, cost-to-revenue efficiency, and any monetization initiatives in non-core segments to validate a longer-term improvement trajectory.
Key Performance Indicators
Revenue
8.00M
QoQ: 1.19% | YoY:-5.36%
Gross Profit
5.93M
74.06% margin
QoQ: 2.53% | YoY:17.95%
Operating Income
-1.83M
QoQ: 15.85% | YoY:-83.15%
Net Income
-1.75M
QoQ: -10.15% | YoY:-47.68%
EPS
-0.04
QoQ: -10.31% | YoY:-46.08%
Revenue Trend
Margin Analysis
Key Insights
Operating cash flow: -$0.770 million; Free cash flow: -$0.776 million; Net debt: -$0.409 million; Cash and short-term investments: $14.909 million; Cash at end of period: $5.738 million; Beginning cash: $6.729 million; Net change in cash: -$0.991 million.
Total assets: $32.998 million; Total liabilities: $9.645 million; Total stockholders’ equity: $23.353 million; Current assets: $22.597 million; Current liabilities: $8.161 million; Cash and equivalents: $5.678 million; Short-term investments: $9.232 million.
Cash Flow and Balance Sheet
- Operating cash flow: -$0.770 million; Free cash flow: -$0.776 million; Net debt: -$0.409 million; Cash and short-term investments: $14.909 million; Cash at end of period: $5.738 million; Beginning cash: $6.729 million; Net change in cash: -$0.991 million.
- Total assets: $32.998 million; Total liabilities: $9.645 million; Total stockholders’ equity: $23.353 million; Current assets: $22.597 million; Current liabilities: $8.161 million; Cash and equivalents: $5.678 million; Short-term investments: $9.232 million.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
8.00M
-5.36%
1.19%
Gross Profit
5.93M
17.95%
2.53%
Operating Income
-1.83M
-83.15%
15.85%
Net Income
-1.75M
-47.68%
-10.15%
EPS
-0.04
-46.08%
-10.31%
Key Financial Ratios
currentRatio
2.77
grossProfitMargin
74.1%
operatingProfitMargin
-22.8%
netProfitMargin
-21.8%
returnOnAssets
-5.29%
returnOnEquity
-7.48%
debtEquityRatio
0.23
operatingCashFlowPerShare
$-0.02
freeCashFlowPerShare
$-0.02
priceToBookRatio
3.08
priceEarningsRatio
-10.29
Net Income vs. Revenue
Expense Breakdown
Management Commentary
No management earnings-call highlights were provided in the data set. No quotes or thematic quotes are available from the Q2 2025 transcript in the accompanying materials.
N/A
— N/A
N/A
— N/A
Forward Guidance
No formal forward guidance was disclosed in the provided data. Given the current earnings mix—stable revenue with material operating losses—the near-term guidance that would be most impactful includes targets for reducing operating expenses, scaling higher-margin asset management fees, and achieving positive EBITDA. Investors should seek management commentary on: (1) AUM growth or anticipated inflows, (2) cost-control initiatives and synergies across diversified segments, (3) progress in monetizing non-core businesses (e.g., fintech software, consumer product lines), and (4) capital allocation priorities (dividends, share repurchases, or debt reduction). Absent explicit targets, the achievability of any guidance will hinge on achieving revenue stability while materially improving cost efficiency and cash flow generation.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
MGLD Focus
74.06%
-22.80%
-7.48%
-10.29%
CXH
88.00%
84.30%
2.54%
8.67%
EOT
75.90%
1.62%
4.28%
5.54%
NXC
1.00%
90.40%
1.44%
17.03%
DRCT
27.10%
-9.45%
1.33%
-7.34%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
The QQ2 2025 results depict a company with solid liquidity and a compelling gross margin profile but with persistent profitability and cash-flow challenges. The stock trades with negative earnings and a high price-to-sales context (P/S ~9) while reporting negative EBITDA and net income, signaling elevated risk for near-term capital appreciation absent improvement in profitability. The investment case hinges on two potential catalysts: (1) meaningful AUM growth and higher-margin fee revenue across asset-management activities, and (2) successful monetization or efficiency gains from non-core segments (notably fintech initiatives). Until there is clear traction on these fronts and a path to positive free cash flow, the investment thesis should be cautious, favoring a wait-and-see stance or a small-position approach with close monitoring of operating costs, cash burn, and any forward-looking guidance from management.
Key Investment Factors
Growth Potential
Moderate growth potential from stabilized fee-based revenue in asset management and potential monetization of fintech initiatives. Upside could come from AUM expansion, cross-selling across diversified segments, and improving operating leverage as fixed costs dilute with higher fee-based revenue.
Profitability Risk
Key risks include persistent profitability headwinds due to elevated operating and SG&A costs, reliance on volatile asset management markets, limited visibility into future AUM growth, and negative free cash flow in the near term. The narrow operating income line and negative EBITDA amplify sensitivity to revenue mix shifts.
Financial Position
Balanced liquidity with $14.9 million in cash and short-term investments and modest leverage (debt/ equity ~0.23; debt ratio ~0.16). Net debt is negative, providing a cushion for near-term financing needs. However, negative free cash flow and ongoing losses signal a cautious stance on cash sustainability until profitability improves.
SWOT Analysis
Strengths
Robust gross margin (~74%) driven by asset-light fee-based revenue components.
Strong liquidity profile with cash and short-term investments (~$14.9 million) and negative net debt indicating financial flexibility.
Diversified portfolio of businesses potentially enabling cross-sell and risk diversification across multiple cycles.
Weaknesses
Material operating losses and negative EBITDA; net income of -$1.75 million in QQ2 2025.
Negative free cash flow (-$0.776 million) and dependence on working capital to fund operations.
Limited visible near-term catalysts for profitability given lack of explicit guidance and reliance on cyclical assets.
Opportunities
Monetization of fintech software and potential synergies across diversified lines to improve operating leverage.
Potential AUM growth in asset management segment that could lift fee-based revenue and margins over time.
Cost optimization and headcount alignment to bring EBITDA toward positive territory.
Threats
Market volatility impacting asset management revenues and fee-based income.
Execution risk in integrating and scaling non-core businesses (e.g., fintech, consumer product lines).
Regulatory and competitive pressures in financial services could compress margins or demand higher compliance costs.