SMST Report at a glance:
- Revenue for Q1 2025: $65.45 million, up 13.7% year-over-year and 5.2% quarter-over-quarter, reflecting resilient topline activity in a niche leveraged product. Operating income recorded $17.239 million, yielding an operating margin of 26.3% (revenue basis).
- Bottom-line pressure driven by non-operating items: Net income declined to -$8.405 million with a net margin of -12.8%, as total other income and expenses totaled -$26.25 million and interest expense was -$22.02 million. Earnings per share stood at -$0.35.
- Cash generation and balance sheet strength: Operating cash flow was $10.55 million and free cash flow matched this level, contributing to a cash balance of $39.885 million at period end. The company carries no long-term debt, total assets of roughly $2.11 billion, and equity of about $303 million, signaling a conservative balance sheet in the current period.
- Investment considerations: The earnings narrative is dominated by the leveraged product construct and non-operating items rather than core profitability. Given the lack of a management transcript for QQ1 2025, forward-looking guidance remains unavailable; investors should monitor asset growth in the ETF line, changes in the cost structure for non-operating items, and evolving regulatory and market dynamics around leveragedInverse ETFs.
Key Performance Indicators
Revenue
Increasing
65.45M
QoQ: 5.15% | YoY: 13.70%
Operating Income
Increasing
17.24M
QoQ: -7.05% | YoY: 1.56%
Net Income
Decreasing
-8.41M
QoQ: -31.37% | YoY: -654.94%
EPS
Increasing
-0.35
QoQ: -100.54% | YoY: 97.21%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue: $65.45m (YoY +13.70%, QoQ +5.15%)
Gross Profit: $65.45m (effectively 100% gross margin reported in ratios)
Operating Income: $17.239m (YoY +1.56%, QoQ -7.05%); Margin ~26.3%
Net Income: -$8.405m (YoY -654.94%, QoQ -31.37%); EPS -$0.35 (YoY +97.21%, QoQ -100.54%)
EBITDA: $17.239m; EBITDA Margin ~26.34%
Cash Flow: Net cash from operating activities $10.55m; Free cash flow $10.55m; Net change in cash $10.584m; Cash at end $39.885m
Balance Sheet: Total assets $2.114b; Cash and cash equivalents $35.173m; Goodwill $53.643m; Intangibles $8.46m; Total liabilities $1.464b; Total stockholders’ equity $302.97m; No debt; Net debt position -$35.173m
Valuation & Efficiency: P/B 2.97; P/S 13.73; EV/Revenue ~50.1x; Asset turnover 0.031; Operating cash flow per share $0.048; Free cash flow per share $0.048
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
65.45M
13.70%
5.15%
Gross Profit
65.45M
13.70%
137.45%
Operating Income
17.24M
1.56%
-7.05%
Net Income
-8.41M
-654.94%
-31.37%
EPS
-0.35
97.21%
-100.54%
Key Financial Ratios
Gross Profit Margin
Weak
1.00%
Gross profit margin is below industry norms, profitability concerns
Operating Profit Margin
Excellent
26.30%
Operating margin is exceptional, indicating strong pricing power and operational efficiency
Net Profit Margin
Weak
-0.13%
Net profit margin is below industry norms, profitability concerns
Return on Assets
Weak
0.00%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
-0.03%
Return on equity suggests inefficient capital allocation
P/E Ratio
Negative
-26.74x
Negative earnings make P/E ratio not meaningful
Price to Book
Fair Value
2.97x
Price-to-book ratio reasonable for profitable companies
Management Insights Available for Members
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