Leadway Technology (2086.HK) Q1 2025 Earnings Report

Leadway Technology Investment Group Limited (2086.HK) reported a weaker QQ1 2025 versus QQ1 2024 on top-line and profitability metrics. Revenue declined to HKD 20.41 million, from HKD 23.61 million a year earlier, a YoY drop of 13.5%, and a QoQ decline of 23.1% from the prior quarter’s HKD 26.54 million. The gross profit totaled HKD 11.09 million, yielding a gross margin of 54.33%, modestly higher than QQ1 2024’s 52.02% but offset by a steep rise in operating expenses. Operating income was negative HKD 2.52 million with EBITDA of negative HKD 1.82 million, driving net income to negative HKD 2.60 million and an EPS of -0.0081. The YoY and QoQ declines in revenue, coupled with a sharp deterioration in profitability metrics, signal that the business remains in a transition phase, with cost structure and product mix pressure weighing on the bottom line. Management commentary is not captured in the provided data; as a result, forward-looking guidance and qualitative updates from the QQ1 2025 earnings call are not available. However, the company continues to operate in a niche security/protection services and smart card solution space, with R&D and SG&A investments persisting. Investors should monitor any signs of improving operating leverage, cost controls, and the pace of revenue growth in core smart card and automatic revenue collection solutions, particularly in government and cross-border deployments that may unlock higher-margin opportunities.