Sonoma Pharmaceuticals reported QQ1 2025 revenue of $3.391 million, marking a modest sequential decline (-1.40% QoQ) and a year-over-year drop of 1.05%. Despite a Browning gross margin expansion to 38.5% (gross profit of $1.306 million), the quarter remained meaningfully unprofitable with EBITDA of $(1.134) million and net income of $(1.143) million, translating to an EPS of $(1.3424). The company’s operating performance continues to reflect scale challenges typical of a small-cap HOCl-based wound care and dermatology portfolio, even as some margin lessons begin to take hold. YoY gross profit grew about 8.5% and operating income improved roughly 5.4% on a per-quarter basis, but negative absolute profitability persists due to high SG&A and fixed cost absorption at a small revenue base.
Liquidity remained adequate for near-term needs, with cash and cash equivalents of $2.589 million and a net cash burn from operations of $(0.912) million for QQ1 2025. Free cash flow was $(0.917) million, underscoring the ongoing need for either further revenue scale, cost discipline, or external financing to sustain operations absent a material improvement in profitability. Management commentary is not provided in the supplied data, limiting the ability to assess narrative shifts around channel expansion, product acceptance, or strategic partnerships. The landscape remains a micro-cap HOCl specialty space with limited clinical trial activity and a focus on wound care, animal health, eye care, and dermatology, where growth hinges on distribution expansion, regulatory considerations, and competitive positioning.