Dalrada Financial (DFCO) Q1 2024 Earnings Report

Dalrada Financial Corporation (DFCO) reported QQ1 2024 revenue of $5.02 million with a gross margin of 19.3% but delivered a substantial net loss of $4.82 million and negative EBITDA of $4.55 million. The quarter showed a material earnings deterioration on a cash-flow basis, with negative operating cash flow of $1.76 million and free cash flow of $1.86 million. Despite a year-over-year revenue uplift of ~38%, the company registered a sharp sequential revenue decline of ~47% quarter-over-quarter, underscoring an uneven top-line trajectory and ongoing profitability headwinds.

From a balance-sheet perspective, DFCO exhibits elevated leverage and weak liquidity. Total liabilities of $24.75 million exceed total assets of $25.42 million, and stockholders’ equity sits negative at approximately $-0.55 million, with retained earnings deeply negative at about $-146.55 million. The liquidity metrics are stretched: current ratio ~0.85, quick ratio ~0.66, and cash ratio ~0.03, while long-term debt stands at $8.81 million and short-term debt at $1.73 million. Net debt approximates $10.20 million, contributing to an unfavorable debt position (debt-to-capital around 95%). The business’ operating model remains challenged—EBITDA and operating income are deeply negative, signaling underlying margin compression and limited operating leverage in QQ1 2024.

Key themes for investors include the potential upside from DFCO’s diversified industrial offerings (clean energy, healthcare technology, education services) and the need for meaningful deleveraging and working-capital management to stabilize liquidity. Absent a material turnaround in profitability or a credible debt-reduction plan, the stock remains a high-risk, high-uncertainty exposure within the Industrials/Consulting Services landscape.