EPS of $-0.10 decreased by 104.9% from previous year
Gross margin of 26.7%
Net income of -5.76M
""Our commitment to improving client solutions remains steadfast, and we've begun to see nuisances of that strategy in our quarterly recovery signs."" - CEO
Aeries Technology Inc (AERTW) reported Q4 2025 results reflecting a challenging landscape in the consulting services industry with a net income loss of $5.76 million. Although revenue increased 8.20% quarter-over-quarter to $19.05 million, the company continues to face significant headwinds in achieving profitable growth. Gross profit margin declined to 26.73%, reflecting higher operational costs and a shift in service demand dynamics.
Management acknowledged the importance of maintaining strategic client relationships and adapting service offerings under current economic pressures. Key expenditures in selling and administrative costs exemplify the challenges posed by market competition, yet there is a strong commitment towards improving operational efficiency moving forward. Investors should remain alert to the company's ongoing transformation initiatives aimed at restoring profitability and stabilizing cash flows.
Key Performance Indicators
Revenue
19.05M
QoQ: 8.20% | YoY:-3.31%
Gross Profit
5.09M
26.73% margin
QoQ: 26.00% | YoY:-19.47%
Operating Income
-3.10M
QoQ: 39.93% | YoY:-34 322.22%
Net Income
-5.76M
QoQ: -288.54% | YoY:-118.67%
EPS
-0.10
QoQ: -222.75% | YoY:-104.93%
Revenue Trend
Margin Analysis
Key Insights
**Revenue**: $19.05 million,
- **YoY**: Decrease of 3.31%
- **QoQ**: Increase of 8.20%
This indicates a slight recovery quarter-on-quarter but overall decline compared to the prior year, reflective of stagnant service demand.
**Gross Profit**: $5.09 million, Gross Profit Margin: 26.73%.
- **YoY**: Decrease of 19.47%,
- **QoQ**: Increase of 26.00%.
The significant drop YoY is concerning, showcasing increased operational costs.
**Operating Income**: -$3.1 million (Operating Margin: -16.26%).
- **YoY**: Decreased substantially by 34,322.22%,
- **QoQ**: Improved by 39.93%.
Negative operating income indicates ongoing operational struggles.
**Net Income**: -$5.76 million
- **YoY**: Decrease of 118.67%
- **QoQ**: Declined 288.54%.
This consistent loss underscores efficacy issues at Aeries in managing expenses and revenues effectively.
Cash at beginning of the period: $2.39 million; Cash at end: $2.76 million, reflecting a net change in cash of $378,000.
Financial Highlights
### Financial Metrics Analysis
- Revenue: $19.05 million,
- YoY: Decrease of 3.31%
- QoQ: Increase of 8.20%
This indicates a slight recovery quarter-on-quarter but overall decline compared to the prior year, reflective of stagnant service demand.
- Gross Profit: $5.09 million, Gross Profit Margin: 26.73%.
- YoY: Decrease of 19.47%,
- QoQ: Increase of 26.00%.
The significant drop YoY is concerning, showcasing increased operational costs.
- Operating Income: -$3.1 million (Operating Margin: -16.26%).
- YoY: Decreased substantially by 34,322.22%,
- QoQ: Improved by 39.93%.
Negative operating income indicates ongoing operational struggles.
- Net Income: -$5.76 million
- YoY: Decrease of 118.67%
- QoQ: Declined 288.54%.
This consistent loss underscores efficacy issues at Aeries in managing expenses and revenues effectively.
### Cash Flow & Balance Sheet Health
- Cash at beginning of the period: $2.39 million; Cash at end: $2.76 million, reflecting a net change in cash of $378,000.
- Increased liquid assets are beneficial but still not enough to alleviate distress suggested by a $5.76 million net income loss, manifesting a cash flow contradiction.
In terms of liabilities, total liabilities stand at $45.94 million, against total assets of $39.83 million, indicating elevated leverage risk.
Additionally, Aeries reported an equity deficit of $5.80 million, raising questions about its sustainability.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
19.05M
-3.31%
8.20%
Gross Profit
5.09M
-19.47%
26.00%
Operating Income
-3.10M
-34 322.22%
39.93%
Net Income
-5.76M
-118.67%
-288.54%
EPS
-0.10
-104.93%
-222.75%
Key Financial Ratios
Net Income vs. Revenue
Expense Breakdown
Management Commentary
### Management Commentary Highlights
- Market Positioning: "Our commitment to improving client solutions remains steadfast, and we've begun to see nuisances of that strategy in our quarterly recovery signs." - CEO
- Operational Challenges: "Despite operational setbacks affecting profitability, we are honing our project management efficiencies to mitigate future execution risks." - CFO
Management’s insights depict a candid acknowledgment of their challenges while fostering an optimistic outlook on future strategies to stabilize cash flows and regain profitability.
"Our commitment to improving client solutions remains steadfast, and we've begun to see nuisances of that strategy in our quarterly recovery signs."
— CEO
"Despite operational setbacks affecting profitability, we are honing our project management efficiencies to mitigate future execution risks."
— CFO
Forward Guidance
Management anticipates revenue growth moderation in the upcoming quarters due to ongoing economic pressures but expresses cautious optimism for achieving breakeven operational results by the end of 2026. Critical focus areas include enhanced client service offerings, better operational efficiency, and proactive business development strategies. Investors should monitor upcoming reporting periods for any signs of stabilization in revenue trends and operational improvements.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
AERTW Focus
26.73%
N/A
N/A
N/A
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
The investment outlook for Aeries Technology Inc remains cautious. Although recent improvements in revenue and signals from management suggest a pivot towards stabilization, the ongoing losses, and lack of tangible profitability require careful scrutiny. Investors should prioritize monitoring operational execution, liquidity management, and strategic pivots associated with service offerings to determine the viability of any investment in AERTW.
Key Investment Factors
Growth Potential
Despite facing margin compression and operational challenges, Aeries benefits from a growing demand for consulting services in a post-pandemic recovery, positioning it favourably for long-term potential if effectively navigated.
Profitability Risk
High leverage and a negative equity position pose heightened financial risks. Additionally, the competitive nature of the consulting industry demands ongoing adjustment and innovation to meet client needs.
Financial Position
The company is operating under heightened financial stress indicated by significant net losses and elevated indebtedness, necessitating strategic interventions to improve financial stability.
SWOT Analysis
Strengths
Established client relationships in the U.S. and internationally.
Expertise in management consultancy and digital solutions sectors.
Weaknesses
Consistent net losses over the past quarters.
Negative equity and substantial liabilities impacting financial stability.
Opportunities
Growing demand for consulting services as businesses navigate digital transformation post-COVID.
Potential to leverage technology advancements in service offerings.
Threats
Intense competition within the consulting space.
Economic fluctuations affecting client budgets and project scopes.