Executive Summary
Netcapital Inc (NCPL) reported a challenging QQ1 2025, with revenue of 142,227 USD and gross profit of 132,007 USD, yielding a healthy gross margin of approximately 92.8%. However, the company incurred substantial operating expenses, driving an operating loss of 2,508,237 USD and a net loss of 2,527,170 USD for the quarter. Earnings per share stood at -5.10, with negative momentum in profitability and continued cash burn from operating activities (-1,963,645 USD). The balance sheet shows a solid equity base (total stockholders’ equity of 37,508,453 USD) but relatively weak liquidity metrics (current ratio 0.27, cash ratio 0.25) and a net debt position of 1,564,943 USD given cash of 855,181 USD against total debt of 2,420,124 USD. The fourth-factor takeaway is that revenue remains far below the level needed to meaningfully offset overhead, suggesting a need for either accelerated top-line growth or aggressive cost containment to reach a sustainable profitability trajectory. Management commentary from the earnings call is not provided in the supplied transcript dataset, limiting the ability to corroborate near-term guidance or strategic pivots.
Key takeaways for investors: (1) revenue decline is dramatic year-over-year and quarter-over-quarter, but gross margins are exceptionally high on the small top-line; (2) SG&A and related operating expenses dominate, producing sizable losses even with narrow COGS; (3) liquidity is constrained despite a strong equity base, indicating reliance on external financing or capital markets access to fund ongoing operations; (4) the company’s path to profitability hinges on either substantial revenue growth in its fintech funding portal and advisory services, or durable cost reductions and efficiency gains.
Key Performance Indicators
QoQ: -59.03% | YoY:-93.03%
QoQ: 123.83% | YoY:-93.47%
QoQ: -61.89% | YoY:-4 903.21%
QoQ: 3.05% | YoY:-844.13%
QoQ: -2 218.18% | YoY:-14 266.67%
Key Insights
Revenue: 142,227 (YoY -93.03%, QoQ -59.03%)
Gross Profit: 132,007 (YoY -93.47%, QoQ +123.83%)
Operating Income: -2,508,237 (YoY -4,903.21%, QoQ -61.89%)
Net Income: -2,527,170 (YoY -844.13%, QoQ +3.05%)
EPS: -5.10 (YoY -14,266.67%, QoQ -2,218.18%)
Gross Margin: 92.8%
Operating Margin: -17.64%
Net Margin: -17.77%
EBITDA: -2,507,837
Cash from Operations: -1,963,645
Free Cash Flow: -1,963,645
Cash at End of Period: 855,181
Total Assets: 41,440,970
Total Liabilities: 3,932,517
Total Stockholders’ ...
Financial Highlights
Revenue: 142,227 (YoY -93.03%, QoQ -59.03%)
Gross Profit: 132,007 (YoY -93.47%, QoQ +123.83%)
Operating Income: -2,508,237 (YoY -4,903.21%, QoQ -61.89%)
Net Income: -2,527,170 (YoY -844.13%, QoQ +3.05%)
EPS: -5.10 (YoY -14,266.67%, QoQ -2,218.18%)
Gross Margin: 92.8%
Operating Margin: -17.64%
Net Margin: -17.77%
EBITDA: -2,507,837
Cash from Operations: -1,963,645
Free Cash Flow: -1,963,645
Cash at End of Period: 855,181
Total Assets: 41,440,970
Total Liabilities: 3,932,517
Total Stockholders’ Equity: 37,508,453
Total Debt: 2,420,124
Net Debt: 1,564,943
Current Ratio: 0.269
Debt-to-Equity: 0.0645
Price-to-Book: 0.0640
Price-to-Sales: 16.89
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
142.23K |
-93.03% |
-59.03% |
| Gross Profit |
132.01K |
-93.47% |
123.83% |
| Operating Income |
-2.51M |
-4 903.21% |
-61.89% |
| Net Income |
-2.53M |
-844.13% |
3.05% |
| EPS |
-5.10 |
-14 266.67% |
-2 218.18% |
Key Financial Ratios
operatingProfitMargin
-1764%
operatingCashFlowPerShare
$-3.96
freeCashFlowPerShare
$-3.96
Management Commentary
Transcript data available in the provided dataset is empty for QQ1 2025. Therefore, no management quotes or thematic highlights from the earnings call are included. If a full transcript becomes available, this section can be updated to reflect management perspectives on monetization strategy, go-to-market plans, cost discipline, and near-term guidance.
Forward Guidance
No formal forward guidance is included in the supplied data set. Given the QQ1 2025 results, investors should monitor (i) whether Netcapital can materially grow revenue via its Netcapital.com funding portal and related advisory services, (ii) ongoing cost containment and SG&A discipline to move toward breakeven, and (iii) liquidity management including access to financing to support working capital needs. Industry dynamics in fintech capital markets suggest potential upside if network effects accelerate deal flow and investor participation, but the lack of visible top-line growth and the current negative cash flow signal meaningful execution risk in the near term. Management commentary (when available) should clarify: revenue mix evolution, customer onboarding and CAC, anticipated price realization, and any shift in strategic priorities.