Executive Summary
Escalon Medical Corp reported a solid Q2 2025 with revenue of $3.220–million, up 12.2% year-over-year and 15.8% quarter-over-quarter, driven by favorable product mix and volume in its ophthalmology device portfolio. The company posted a gross profit of $1.574–million resulting in a gross margin of 48.9%, and an operating income of $0.256–million, yielding an operating margin of 7.95%. Net income was $0.246–million, translating to basic earnings per share of $0.02. Aggregate EBITDA stood at $0.261–million with an EBITDA margin of about 8.1%. Operating cash flow was $0.301–million, and free cash flow matched operating cash flow at $0.301–million, underscoring a positive cash-generating core.
From a balance-sheet perspective, Escalon continues to exhibit a favorable liquidity profile for a microcap: cash and equivalents around $0.52–$0.78 million on different line items, total debt of about $0.33 million, and net debt of approximately negative $0.19 million, indicating net cash on hand. Working capital metrics show a current ratio near 1.95x and a quick ratio near 1.17x, with a reasonable inventory level and receivables balance supporting short-term needs. However, reported retained earnings are negative, and the equity base is relatively modest, signaling a need for continued operating leverage and prudent capital management to support growth.
Management commentary for QQ2 2025 is not captured in the provided transcript data, limiting the ability to quote direct guidance or specific strategic signals. As a result, the forward outlook rests on quantitative indicators and historical performance, with a caveat that the company operates in a small-cap, OTC market environment where liquidity and visibility can influence valuation and execution risk.
Key Performance Indicators
QoQ: 1 049.37% | YoY:462.86%
QoQ: 863.64% | YoY:422.35%
QoQ: 565.12% | YoY:294.17%
Key Insights
Revenue: $3,220,556; YoY growth 12.24%; QoQ growth 15.79%
Gross Profit: $1,573,981; Gross margin 48.87%; YoY gross profit growth 24.78%; QoQ 29.74%
Operating Income: $255,904; Operating margin 7.95%; YoY operating income growth 462.86%; QoQ 1,049.37%
Net Income: $246,021; Net margin 7.64%; YoY net income growth 422.35%; QoQ 863.64%
Earnings Per Share (EPS): $0.02; Diluted EPS: $0.02; Weighted average shares (non-diluted): 7,415,329; Weighted average shares (diluted): 14,081,616
EBITDA: $260,756;...
Financial Highlights
Revenue: $3,220,556; YoY growth 12.24%; QoQ growth 15.79%
Gross Profit: $1,573,981; Gross margin 48.87%; YoY gross profit growth 24.78%; QoQ 29.74%
Operating Income: $255,904; Operating margin 7.95%; YoY operating income growth 462.86%; QoQ 1,049.37%
Net Income: $246,021; Net margin 7.64%; YoY net income growth 422.35%; QoQ 863.64%
Earnings Per Share (EPS): $0.02; Diluted EPS: $0.02; Weighted average shares (non-diluted): 7,415,329; Weighted average shares (diluted): 14,081,616
EBITDA: $260,756; EBITDA margin approx. 8.1%
Cash Flow: Net cash from operating activities $300,941; Free cash flow $300,941; Net change in cash $290,920; Cash at end of period $777,070; Cash/Financing activity dynamics: net financing outflow about $(22.64) million (large one-time activity dominates), reflecting financing/other non-operating items rather than core operating cash generation.
Balance Sheet Highlights: Total assets $4,486,501; Total current assets $4,303,550; Cash and cash equivalents $520,584; Total current liabilities $2,211,277; Long-term debt $251,838; Short-term debt $77,267; Net debt position negative $(191,479) indicating net cash; Total liabilities $2,463,115; Total stockholders’ equity $2,023,386; Retained earnings reported as negative; Intangible assets $39,617; Goodwill nil or immaterial.
Liquidity and profitability ratios: Current ratio 1.95x; Quick ratio 1.17x; Gross margin 48.9%; Operating margin 7.95%; Net margin 7.64%; Return on assets 5.48%; Return on equity 12.20%; Debt to assets 7.34%; Debt to equity 16.3%; Price to sales 0.289x; Price to book value 0.460x; Price to earnings 0.946x; Enterprise value multiple 2.83x; Price to free cash flow 3.09x.
Notes on data integrity: Several balance-sheet line items appear inconsistent (e.g., retained earnings vs. total equity) in the supplied data. The interpretation here adopts the values as provided, with a cautionary note on scale and consistency for external comparison.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
3.22M |
12.24% |
15.79% |
| Gross Profit |
1.57M |
24.78% |
29.74% |
| Operating Income |
255.90K |
462.86% |
1 049.37% |
| Net Income |
246.02K |
422.35% |
863.64% |
| EPS |
0.02 |
294.17% |
565.12% |
Key Financial Ratios
operatingProfitMargin
7.95%
operatingCashFlowPerShare
$0.04
freeCashFlowPerShare
$0.04
Management Commentary
transcriptHighlights:"No QQ2 2025 earnings call transcript was supplied in the data set. As a result, management quotes and thematic insights from the earnings call could not be included. Investors should refer to the official earnings release and sec filings for verbatim guidance and color from management."
Forward Guidance
There is no formal forward guidance provided within the supplied QQ2 2025 materials. Given the solid top-line growth and margin retention observed in Q2, the potential catalysts could include ongoing demand for ophthalmology devices and related consumables, incremental efficiencies from cost containment, and any scale benefits as sales volumes increase. In the absence of explicit targets, investors should monitor: (1) revenue trajectory and product mix in Q3-Q4 2025, (2) sustained gross margin in the mid-to-high 40s percent range, (3) working capital dynamics (receivables and payables timing) to ensure cash conversion remains favorable, and (4) financing activities and any non-operating items that could affect net cash position. If management issues qualitative guidance later, compare actuals to stated targets, and adjust expectations accordingly.