Executive Summary
Sonoma Pharmaceuticals (SNOA) reported QQ4 2024 revenue of $3.439 million, up 14.1% year over year and 9.6% sequentially from QQ3 2024, signaling modest top-line momentum in its HOCl-based product portfolio. Despite the revenue gain, the company posted an operating loss of $1.409 million and a net loss of $1.067 million for the quarter, with EBITDA of $(1.368) million and an EBITDA margin of approximately −39.8%. The gross margin was 31.7% (gross profit of $1.091 million on $3.439 million in revenue), reflecting a combination of product mix effects and ongoing investments in the portfolio. Cash flow was modestly positive from operations: $0.152 million, contributing to an end-of-period cash balance of $3.129 million. Free cash flow totaled $0.155 million for the period, underscoring a controlled cash burn despite escalating operating expenses.
The balance sheet remains structurally healthy for a small-cap specialty pharma: current assets of $12.286 million and current liabilities of $3.719 million yield a robust current ratio of 3.30 and a quick ratio of 2.57. Total liabilities stood at $8.756 million against total equity of $6.137 million, producing a conservative leverage profile (debt to equity roughly 0.10 and debt to total capitalization around 9%). Net debt is negative on a cash-rich basis due to cash holdings versus debt, at approximately $(2.52) million.
Looking ahead, near-term profitability remains a challenge given the ongoing investment cycle in the HOCl portfolio, R&D intensity, and SG&A burn. However, the company’s cash runway and improving top-line trajectory offer optionality if operating leverage improves and if revenue composition shifts toward higher-margin HOCl products with favorable mix. Management commentary from the QQ4 2024 period is not captured in the provided transcript, limiting explicit forward-guidance; investors should monitor product adoption in Microcyn/Microcyn-based lines, international expansion opportunities, and any cost-control initiatives that could drive EBITDA improvement.
Key Performance Indicators
QoQ: -25.27% | YoY:26.27%
QoQ: -66.94% | YoY:-22.84%
QoQ: -23.21% | YoY:18.43%
Key Insights
Revenue: $3.439 million in QQ4 2024, up 14.1% YoY and 9.59% QoQ. Gross profit: $1.091 million; Gross margin: 31.72%. Operating income: $(1.409) million; EBITDA: $(1.369) million; Net income: $(1.067) million; EPS: $(1.367).
Liquidity and balance sheet: Cash and cash equivalents at period end $3.128 million; total assets $14.893 million; total liabilities $8.756 million; total stockholders’ equity $6.137 million. Current ratio 3.30; quick ratio 2.57; cash ratio 0.84. Net debt $(2.520) million ...
Financial Highlights
Revenue: $3.439 million in QQ4 2024, up 14.1% YoY and 9.59% QoQ. Gross profit: $1.091 million; Gross margin: 31.72%. Operating income: $(1.409) million; EBITDA: $(1.369) million; Net income: $(1.067) million; EPS: $(1.367).
Liquidity and balance sheet: Cash and cash equivalents at period end $3.128 million; total assets $14.893 million; total liabilities $8.756 million; total stockholders’ equity $6.137 million. Current ratio 3.30; quick ratio 2.57; cash ratio 0.84. Net debt $(2.520) million (cash greater than debt). Working capital remains strong; CCC ≈ 156.8 days (DSO 75.8; DIO 104.2; DPO 23.3).
Cash flow: Net cash provided by operating activities $0.152 million; investing activities $(0.018) million; financing activities $0.622 million; net change in cash $0.722 million; free cash flow $0.155 million.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
3.44M |
14.10% |
9.59% |
| Gross Profit |
1.09M |
26.27% |
-25.27% |
| Operating Income |
-1.41M |
-22.84% |
-66.94% |
| Net Income |
-1.07M |
18.43% |
-23.21% |
| EPS |
-1.37 |
51.10% |
13.88% |
Key Financial Ratios
operatingProfitMargin
-41%
operatingCashFlowPerShare
$0.2
freeCashFlowPerShare
$0.2
Management Commentary
No QQ4 2024 earnings call transcript was provided in the data set. As a result, no management quotes or theme-based highlights could be extracted. If a transcript becomes available, key themes to capture would include: (1) strategy execution on HOCl product line expansion (Microcyn family, Celacyn, Acronyms), (2) cost optimization and margin improvement plans, (3) international market efforts and channel strategy, (4) capital allocation priorities given a modest revenue runway and ongoing investment needs.
Forward Guidance
No formal forward guidance was disclosed in the provided materials. Based on QQ4 2024 financials, a cautious outlook is warranted: revenue growth is positive but modest, and profitability remains pressured by operating expenses. A potential pathway to EBITDA breakeven would require either (a) sustained revenue growth in the 6–12% range with gross margins stabilizing around or above ~32–35%, or (b) meaningful SG&A discipline and R&D optimization without compromising pipeline progress. Sensible near-term milestones for investors to monitor include: (i) quarterly revenue trajectory and product mix shifts toward higher-margin HOCl products, (ii) progress in cost containment initiatives in SG&A and R&D, (iii) working capital efficiency improvements (receivables and payables cycles), and (iv) any new partnerships or licensing deals that could accelerate revenue without a commensurate increase in costs. If these factors materialize, Sonoma could move toward positive EBITDA in 2025; otherwise, the cash burn trajectory could persist.