EPS of $-0.27 increased by 81.3% from previous year
Gross margin of 28.0%
Net income of -578.00K
"N/A" - N/A
The InterGroup Corporation (INTG) QQ3 2025 Results Analysis – Recovery in Revenue Amid Ongoing Net Loss and Balance Sheet Strain in Travel Lodging
Executive Summary
The InterGroup Corporation reported a Q3 2025 revenue of $16.824 million, marking a YoY increase of 13.0% and QoQ increase of 16.5% in a quarter that featured an improving top line but a still-marginal bottom line. Gross profit stood at $4.708 million with a gross margin of 27.98%, while EBITDA reached $4.355 million (marginally improving profitability on an operating basis). Despite these operating improvements, INTG posted a net loss of $0.578 million and an EPS of -$0.27 for the quarter, underscoring persistent profitability headwinds driven by interest expense, other non-operating items, and a negative tax impact in the period. Free cash flow was negative at $(5.236) million, reflecting working capital pressure (change in working capital of $(9.84) million) and ongoing capital deployment dynamics. The balance sheet shows total assets of $103.241 million against total liabilities of $215.317 million and negative stockholders’ equity of $(84.488) million, indicating substantial leverage and balance sheet fragility despite cash on hand of $13.394 million. Net debt stood at $(4.017) million, suggesting a modest cash cushion relative to reported liabilities but a structurally challenged equity base. The quarter’s results signal a cautious path to profitability with continued reliance on external financing and working capital management. The company’s near-term focus will likely center on occupancy and rate optimization, cost discipline, and potential asset-level monetization or refinancing to stabilize liquidity and equity position.
- Revenue: $16.824 million; QoQ growth: 16.50%; YoY growth: 13.04% (Q3 2025)
- Gross Profit: $4.708 million; Gross Margin: 27.98%
- EBITDA: $4.355 million; EBITDA Margin: 25.89%
- Operating Income: $2.350 million; Operating Margin: 13.97%
- Net Income: $(0.578) million; Net Margin: (3.43%)
- EPS (diluted): $(0.27); Weighted Avg Shares: 2.155 million
- Cash flow from operations: $(6.667) million; Free Cash Flow: $(5.236) million
- Cash and cash equivalents at period end: $4.018 million; Total cash (incl. short-term investments): $4.768 million
- Net cash provided by financing activities: $12.843 million; Net change in cash: $3.176 million; Cash at end: $13.394 million
- Balance sheet snapshot: Total assets $103.241 million; Total liabilities $215.317 million; Stockholders’ equity $(84.488) million; Net debt $(4.017) million
- Key efficiency: Asset turnover (approximate) 0.16–0.17x; Interest expense: $3.469 million; EBITDAR ~ $6.615 million (derived from EBITDA plus lease-related adjustments).
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
16.82M
13.04%
16.50%
Gross Profit
4.71M
55.28%
48.14%
Operating Income
2.35M
231.45%
175.50%
Net Income
-578.00K
81.73%
78.79%
EPS
-0.27
81.25%
78.57%
Key Financial Ratios
grossProfitMargin
28%
operatingProfitMargin
14%
netProfitMargin
-3.44%
returnOnAssets
-0.56%
returnOnEquity
0.68%
operatingCashFlowPerShare
$-3.09
freeCashFlowPerShare
$-2.43
priceToBookRatio
-0.31
priceEarningsRatio
-11.29
Net Income vs. Revenue
Expense Breakdown
Management Commentary
No earnings call transcript data provided in the supplied material. As a result, management-specific quotes and thematic mentions from the QQ3 2025 call are not available in this analysis. Where gaps exist, commentary focuses on structured financial results and implied guidance from the quarterly performance.
N/A
— N/A
N/A
— N/A
Forward Guidance
INTG did not publicly publish formal forward guidance in the provided materials. Given the quarterly trajectory, a plausible outlook would hinge on occupancy stabilization at the Hilton San Francisco Financial District property, modest ADR (average daily rate) improvements, and disciplined cost control to convert EBITDA gains into free cash flow. External drivers to monitor include local tourism demand in San Francisco, competitive dynamics in the luxury/hub hotel segment, and the company’s ability to refinance or reallocate capital to stabilize the balance sheet. Investors should track: (1) occupancy and average daily rate trends in the hotel segment, (2) working capital normalization and accounts payable/receivable discipline, (3) any strategic asset monetization or refinancing actions, and (4) changes in total debt or equity structure due to financing activity or potential share issuances.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
INTG Focus
27.98%
14.00%
0.68%
-11.29%
HTHT
41.00%
26.70%
10.50%
16.34%
ATAT
41.90%
25.90%
14.80%
16.41%
LUXH
-1.28%
-2.21%
40.50%
-6.29%
IHG
68.40%
23.80%
-7.46%
21.32%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Medium-term investment thesis focuses on INTG’s improving operating performance (EBITDA growth and margin stabilization) set against a structurally strained balance sheet. The combination of top-line growth and gross margin expansion is offset by ongoing net losses and negative equity, limiting near-term upside without capital structure improvements. Investors should monitor liquidity progression, any refinancing actions, and potential asset sales that could restore equity and reduce leverage. If INTG can convert EBITDA gains into sustained free cash flow through working-capital optimization and lower financing costs, the stock could transition to a more favorable risk/return profile. Until then, the stock carries elevated balance-sheet risk and requires clear signs of balance-sheet repair and cash-flow transformation to justify valuation multiples beyond book value.
Key Investment Factors
Growth Potential
Growth potential for INTG hinges on improving hotel operating leverage through occupancy recovery and rate optimization at flagship assets, plus potential upside from diversified real estate investments and strategic investments in income-producing securities. The Q3 2025 EBITDA recovery demonstrates operating gearing that, if complemented by stable financing costs and improved working capital, could drive improved cash generation.
Profitability Risk
Key risks include persistent net losses and negative equity, sensitivity to macro travel demand, and reliance on external financing to fund operations and capital needs. The large liability base relative to assets increases balance-sheet risk, and the negative equity position could constrain future borrowing capacity absent equity infusions or asset sales. Additionally, the concentration in a single flagship hotel could expose INTG to local market shocks and event-driven occupancy swings.
Financial Position
The balance sheet shows total assets of $103.241m against total liabilities of $215.317m and negative stockholders’ equity of $(84.488)m, reflecting a levered capital structure and potential concerns about intrinsic value versus stated liabilities. Although cash on hand ($13.394m) and a modest net debt position ($(4.017)m)) provide liquidity headroom, the negative equity and high liability level imply an elevated funding risk profile and potential impairment/valuation considerations. Operationally, positive EBITDA ($4.355m) with a 25.89% EBITDA margin indicates underlying operating strength that has not yet translated into positive net income due to financing and non-operating charges.
SWOT Analysis
Strengths
Positive gross margin (~28%) and EBITDA generation in QQ3 2025 indicate improving operating efficiencies at the hotel asset.
Revenue growth of 13.04% YoY and 16.50% QoQ in Q3 2025 demonstrate top-line momentum in a competitive travel lodging backdrop.
Net debt is modestly negative (cash on hand exceeds debt), providing liquidity headroom despite a negative equity base.
Cash on hand at period end ($13.394m) supports near-term liquidity needs and potential refinancing options.
Weaknesses
Net income negative for the quarter ($(0.578)m) and a negative net margin (-3.43%).
Negative shareholders’ equity (-$84.488m) and high liabilities create balance-sheet fragility and potential funding/credit concerns.