Edensoft Holdings Limited (1147.HK) Q2 2025 Earnings Report

- Revenue: 227.86 million CNY in QQ2 2025; YoY change: -27.55%; QoQ change: 0.00%
- Gross Profit: 26.973 million CNY; Gross Margin: 11.84%; YoY Gross Profit change: +6.91%; QoQ: 0.00%
- Operating Income: 5.2335 million CNY; Operating Margin: 2.30%; YoY: +245.90%; QoQ: 0.00%
- Net Income: 5.4595 million CNY; Net Margin: 2.40%; YoY: +4035.98%; QoQ: 0.00%
- EPS (basic/diluted): 0.0027 CNY; YoY: +2600.00%; QoQ: 0.00%
- EBITDA: 5.3555 million CNY; EBITDA Margin: 2.35%
- Operating Cash Flow: 15.131 million CNY; Free Cash Flow: 15.102 million CNY; FCF Margin ≈ 6.64%
- Balance sheet: Total assets 341.07 million CNY; Total liabilities 133.49 million CNY; Total equity 207.58 million CNY; Net cash position with Net Debt of -68.97 million CNY
- Liquidity: Current ratio 2.40; Quick ratio 1.93; Cash ratio 0.54
- Leverage: Total debt/equity 0.0113; Debt ratio 0.00685; Long-term debt 0.353 million CNY; Short-term debt 1.984 million CNY
- Cash flow highlights: Change in working capital +38.38 million CNY; Accounts receivable +6.04 million; Inventory +29.28 million; Other working capital items notable (-29.38 million in non-cash items); Dividends paid 1.6915 million CNY; Net cash used in financing activities -21.4025 million CNY
- Market ratios (context): Price/Earnings ≈ 10.25x; Price/Book ≈ 1.08x; Price/Sales ≈ 0.98x; Dividend yield ≈ 1.51%
- Segment and mix commentary: Edensoft operates across IT Infrastructure Services, IT Implementation and Supporting Services, and Cloud Services, with cloud-related initiatives cited as a strategic growth vector by management.

Note: No earnings-call transcript was provided in the data set. As a result, transcript highlights and management quotes could not be extracted directly from the source. Expected themes from a typical tech IT services QQ2 call would include cloud-adoption momentum, pipeline visibility, project execution efficiency, and cost-structure optimization. Once a transcript is available, corresponding highlights should be added under this section with quotes grouped by strategy, operations, and market conditions.

Overall, Edensoft presents a cautious-positive investment case. The QQ2 2025 results show revenue pressure but concomitant margin resilience and robust cash generation. The company’s net cash position and low debt provide optionality for strategic investments, M&A in adjacencies, or capital returns if revenue stabilization or growth improves. The key to a more constructive investment stance is a demonstrated acceleration in cloud-services revenue, improved backlog visibility, and sustained cost discipline that translates into higher sustainable margins. Relative valuation (P/E ≈ 10.25x, P/B ≈ 1.08x) sits near mid-pack for Chinese IT services peers, suggesting limited downside risk given the strong balance sheet but limited upside without a meaningful revenue mix shift toward higher-margin, recurring cloud solutions. Investors should monitor cloud-revenue progression, backlog and project execution, and working-capital dynamics as leading indicators of earnings trajectory.