Royale Home Holdings delivered revenue of HKD 190.70 million for QQ2 2025, representing a YoY increase of approximately 26.4% but with a material swing to profitability that underscores a financing-cost drag rather than revenue growth alone. The gross profit of HKD 10.11 million yielded a gross margin of 5.30%. However, by absorbing substantial operating and financing costs, the company reported an operating loss of HKD 228.64 million and a net loss of HKD 294.31 million for the quarter, with EPS of -0.1188. Interest expense of HKD 225.54 million dwarfs the gross profit, driving earnings well into negative territory and leaving net debt elevated against a modest cash balance. Liquidity remains tight (current ratio 0.68; quick ratio 0.58; cash balance HKD 51.23 million) and the balance sheet shows a heavy debt load (total debt HKD 3.50 billion; cash-equivalents HKD 51.23 million), contributing to a low enterprise value metric and a negative profitability trajectory in the near term. The company’s diversified activities across manufacturing, development properties, property investments, and other services add resilience in some cycles, but also concentrate risk around leverage and working capital. Absent meaningful deleveraging or margin expansion, the QQ2 2025 print suggests a cautious near-term outlook, with potential upside if cost efficiencies, pricing, or refinancing reduce financing costs and improve cash flow dynamics.