Executive Summary
Leadway Technology Investment Group Limited (2086.HK) reported QQ2 2025 revenue of HKD 40.83 million, up 53.9% year-over-year, supported by stronger demand for smart card products and related services. Gross profit rose to HKD 22.18 million, delivering a gross margin of 54.33%. Despite top-line strength, margins remained under pressure as EBITDA declined to a HKD 3.64 million loss and net income printed at a HKD 5.20 million loss, driven by elevated operating expenses including SG&A of HKD 21.56 million and research and development expenses of HKD 6.17 million. The operating margin stood at -12.34% and the EBITDAR ratio at -8.92%.
Key Performance Indicators
QoQ: 0.00% | YoY:-654.65%
QoQ: 0.00% | YoY:-738.97%
QoQ: 0.00% | YoY:-748.00%
Key Insights
Revenue: HKD 40.829 million in QQ2 2025, YoY +53.85%, QoQ 0.00%
Gross Profit: HKD 22.183 million, Gross Margin 54.33%
Operating Income: HKD -5.039 million, Margin -12.34%
EBITDA: HKD -3.642 million, EBITDA Margin -8.92%
Net Income: HKD -5.198 million, Net Margin -12.73%
Earnings per Share (EPS): -0.0162 HKD; Diluted EPS: -0.0162 HKD
Liquidity/Leverage: Current ratio 3.10, Quick ratio 1.93, Cash ratio 0.646; Debt ratio 0.064, Debt/Equity 0.088; Price to Book 3.19; P/S 4.46; P/E negative
Cash Flow...
Financial Highlights
Revenue: HKD 40.829 million in QQ2 2025, YoY +53.85%, QoQ 0.00%
Gross Profit: HKD 22.183 million, Gross Margin 54.33%
Operating Income: HKD -5.039 million, Margin -12.34%
EBITDA: HKD -3.642 million, EBITDA Margin -8.92%
Net Income: HKD -5.198 million, Net Margin -12.73%
Earnings per Share (EPS): -0.0162 HKD; Diluted EPS: -0.0162 HKD
Liquidity/Leverage: Current ratio 3.10, Quick ratio 1.93, Cash ratio 0.646; Debt ratio 0.064, Debt/Equity 0.088; Price to Book 3.19; P/S 4.46; P/E negative
Cash Flow: Operating Cash Flow per Share -0.0136, Free Cash Flow per Share -0.0146, Cash per Share 0.0418
Asset Utilization: Asset Turnover 0.518, Fixed Asset Turnover 5.86; Receivables Turnover 2.98, Inventory Turnover 0.777; CCC 146.06 days (DSO 30.23, DIO 115.82, Payables 51.40)
Profitability vs. peers: Net income negative while gross margin remains relatively high versus some peers; P/E not meaningful due to negative earnings; Valuation metrics show P/S and P/B in moderate ranges.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
40.83M |
53.85% |
0.00% |
| Gross Profit |
22.18M |
59.23% |
0.00% |
| Operating Income |
-5.04M |
-654.65% |
0.00% |
| Net Income |
-5.20M |
-738.97% |
0.00% |
| EPS |
-0.02 |
-748.00% |
0.00% |
Key Financial Ratios
operatingProfitMargin
-12.3%
operatingCashFlowPerShare
$-0.01
freeCashFlowPerShare
$-0.01
Management Commentary
No earnings call transcript data provided in the supplied materials. Thus, management quotes and thematic highlights could not be extracted from the QQ2 2025 call.
Forward Guidance
Management guidance was not provided in the provided data for QQ2 2025. Based on the disclosed metrics, the key growth hurdle is converting revenue growth into sustainable profitability. A baseline scenario would involve stabilization or modest expansion of revenue coupled with targeted cost containment to reduce SG&A and R&D as a percentage of revenue. An upside scenario would hinge on a favorable mix shift toward higher-margin contracts and accelerated cost optimization, while a downside scenario would be continued high operating expenses amid slower-than-expected revenue growth. Investors should monitor: (1) trajectory of SG&A and R&D as a percentage of revenue, (2) receivables and inventory management to improve cash conversion, (3) any new contracts or partnerships in security and smart-card solutions, (4) currency exposure and supply chain stability, and (5) early signs of margin expansion across QQ3âQQ4 2025.