Executive Summary
Precision Optics reported QQ1 2025 revenue of $4.197 million, down 13.0% year-over-year and 11.0% quarter-over-quarter. Gross profit was $1.118 million with a gross margin of 26.6%, yet the company posted an operating loss of $1.247 million and a net loss of $1.311 million, translating to an EPS of −$0.21. The quarter marks continued profitability challenges amid a modest improvement in some cost lines but persistent top-line and operating-leverage headwinds. The cash flow profile remains negative from operations, with FCF at −$0.343 million and a cumulative cash balance of $0.636 million, underscoring liquidity and funding needs as the business navigates a low-growth environment in the niche medical imaging space. On the balance sheet, total assets stand at $17.24 million with goodwill of $9.11 million and total liabilities of $7.10 million; stockholders’ equity sits at $10.14 million. The company carries total debt of $2.74 million and net debt of $2.10 million, with current liquidity metrics showing a current ratio of 1.41 and a quick ratio of 0.76, signaling moderate near-term liquidity but modest cushion to weather further downside. Management commentary is not embedded in the provided data; as a result, the forward-looking view relies on the quantitative signal set and industry context. Investors should monitor operating leverage progress, potential improvements in working capital efficiency, and any strategic actions that could unlock value given the sizable goodwill balance.
Key Performance Indicators
QoQ: -11.01% | YoY:-13.00%
Key Insights
Revenue: $4.197M, YoY -13.0%, QoQ -11.01%
Gross Profit: $1.118M, Gross Margin 26.6%, YoY -22.99%, QoQ +9.07%
Operating Income: −$1.247M, Margin −29.71%, YoY −77.08%, QoQ +8.07%
Net Income: −$1.311M, Net Margin −31.24%, YoY −72.80%, QoQ +7.08%
EPS: −$0.21, Diluted −$0.21, YoY −61.54%, QoQ +8.70%
Cash Flow from Operating Activities: −$0.319M
Free Cash Flow: −$0.343M
Cash and Cash Equivalents: $0.636M
Debt (Total): $2.736M; Net Debt: $2.101M
Current Ratio: 1.41; Quick Ratio: 0...
Financial Highlights
Revenue: $4.197M, YoY -13.0%, QoQ -11.01%
Gross Profit: $1.118M, Gross Margin 26.6%, YoY -22.99%, QoQ +9.07%
Operating Income: −$1.247M, Margin −29.71%, YoY −77.08%, QoQ +8.07%
Net Income: −$1.311M, Net Margin −31.24%, YoY −72.80%, QoQ +7.08%
EPS: −$0.21, Diluted −$0.21, YoY −61.54%, QoQ +8.70%
Cash Flow from Operating Activities: −$0.319M
Free Cash Flow: −$0.343M
Cash and Cash Equivalents: $0.636M
Debt (Total): $2.736M; Net Debt: $2.101M
Current Ratio: 1.41; Quick Ratio: 0.76; Cash Ratio: 0.12
Days Sales Outstanding (DSO): 66.98 days; Days Inventory Outstanding (DIO): 101.13 days; Days Payables Outstanding (DPO): 62.64 days; Cash Conversion Cycle (CCC): 105.48 days
Total Assets: $17.24M; Total Liabilities: $7.10M; Stockholders’ Equity: $10.14M
ROE/ROA: Negative across core profitability metrics; Debt to Capitalization: 21.3%; Gross Margin: 26.6%; EBITDA Margin: −28.6%
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
4.20M |
-13.00% |
-11.01% |
| Gross Profit |
1.12M |
-22.99% |
9.07% |
| Operating Income |
-1.25M |
-77.08% |
8.07% |
| Net Income |
-1.31M |
-72.80% |
7.08% |
| EPS |
-0.21 |
-61.54% |
8.70% |
Key Financial Ratios
operatingProfitMargin
-29.7%
operatingCashFlowPerShare
$-0.05
freeCashFlowPerShare
$-0.06
Management Commentary
Transcript not provided in the data set. No management call quotes or highlights are available from the provided input. The following section therefore reflects the absence of transcript-derived insights and relies on the disclosed financials and ratios to frame the narrative.
Forward Guidance
No explicit forward guidance is included in the supplied data. While the quarter underscores continued losses, a potential path to improvement could hinge on: (1) expanding revenue through new or larger contracts in the U.S. and EU medical imaging markets, (2) improving gross margin through product mix optimization and cost discipline, and (3) strengthening working capital management to reduce operating cash burn. If management intends to steer toward cash-flow breakeven or positive FCF, key milestones to monitor would include: reduction in inventory levels toward normalized turnover, faster receivable collections, improved supplier terms to lower COGS, and any announced strategic actions (e.g., product rationalization, partnership deals, or an IP monetization plan). Given the current negative profitability and modest liquidity, achievability of goals will depend on tangible improvements in these operating levers and any external financing or strategic transactions.