The company achieved $1.13 billion in revenue, yet structural constraints are evident in the razor-thin 3.3% gross margin and a negative -15.59% operating margin.
| Metric | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 |
|---|
| Sales/Revenue | 1.13B | 822.83M | 568.87M | 162.95M | 81.05M |
| Revenue Growth % | 37.21% | 44.64% | 249.1% | 101.06% | - |
| Cost of Goods Sold | 1.09B | 788.39M | 537.61M | 143.1M | 70.03M |
| COGS % of Revenue | 96.7% | 95.81% | 94.51% | 87.82% | 86.4% |
| Gross Profit | 37.25M | 34.44M | 31.26M | 19.85M | 11.02M |
| Gross Margin % | 3.3% | 4.19% | 5.49% | 12.18% | 13.6% |
| Gross Profit Growth % | 8.14% | 10.2% | 57.45% | 80.16% | - |
| Operating Expenses | 213.26M | 30.82M | 37.7M | 41.84M | 25.34M |
| OpEx % of Revenue | 18.89% | 3.75% | 6.63% | 25.67% | 31.27% |
| Selling, General & Admin | 156.97M | 26.35M | 32.22M | 34.91M | 18.93M |
| SG&A % of Revenue | 13.9% | 3.2% | 5.66% | 21.42% | 23.35% |
| Research & Development | 56.29M | 4.46M | 5.48M | 6.93M | 6.41M |
| R&D % of Revenue | 4.99% | 0.54% | 0.96% | 4.25% | 7.91% |
| Other Operating Expenses | 0 | 0 | 0 | 0 | 0 |
| Operating Income | -176.01M | 3.63M | -6.44M | -21.98M | -14.32M |
| Operating Margin % | -15.59% | 0.44% | -1.13% | -13.49% | -17.67% |
| Operating Income Growth % | -4954.05% | 156.31% | 70.71% | -53.5% | - |
| EBITDA | -166.47M | 12.33M | 3.69M | -11.98M | -10.11M |
| EBITDA Margin % | -14.74% | 1.5% | 0.65% | -7.35% | -12.47% |
| EBITDA Growth % | -1449.9% | 234.02% | 130.83% | -18.53% | - |
| D&A (Non-Cash Add-back) | 9.54M | 8.71M | 10.13M | 10.01M | 4.22M |
| EBIT | -171.47M | 5.57M | -3.6M | -14.78M | -13.68M |
| Net Interest Income | -1.29M | -764K | -408K | -18K | -34.77M |
| Interest Income | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 1.29M | 764K | 408K | 18K | 34.77M |
| Other Income/Expense | 3.25M | 1.18M | 2.44M | 7.19M | -34.13M |
| Pretax Income | -172.76M | 4.8M | -4M | -14.8M | -48.45M |
| Pretax Margin % | -15.3% | 0.58% | -0.7% | -9.08% | -59.78% |
| Income Tax | 510K | -972K | 2.37M | 0 | 8K |
| Effective Tax Rate % | -0.3% | -20.23% | -59.14% | 0% | -0.02% |
| Net Income | -173.47M | 5.54M | -6.21M | -13.64M | -45.06M |
| Net Margin % | -15.37% | 0.67% | -1.09% | -8.37% | -55.6% |
| Net Income Growth % | -3230.15% | 189.26% | 54.5% | 69.72% | - |
| Net Income (Continuing) | -173.27M | 5.78M | -6.37M | -14.8M | -48.46M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 8.78M | 2.34M | 4.11M | 958K | -1.91M |
| EPS (Diluted) | -22.60 | 11.20 | -12.60 | -27.60 | -94.00 |
| EPS Growth % | -301.79% | 188.89% | 54.35% | 70.64% | - |
| EPS (Basic) | -22.60 | 11.20 | -12.60 | -27.60 | -94.00 |
| Diluted Shares Outstanding | 7.71M | 495.06K | 495.06K | 495.06K | 479.46K |
| Basic Shares Outstanding | 7.71M | 495.06K | 495.06K | 495.06K | 479.46K |
| Dividend Payout Ratio | - | - | - | - | - |
Liquidity and margin compression
As reported in recent financial disclosures, LZMH achieved a robust 37.21% year-over-year revenue growth, reaching $1.13 billion, which suggests an aggressive expansion of its vertical bridge transaction volume within the competitive Chinese local services market despite the lack of a clear path to profitability.
The rapid top-line expansion appears to be driven by high-turnover, low-margin merchant coupon aggregation rather than high-value recurring SaaS revenue. Investors should monitor whether this growth is sustainable or if it relies on unsustainable subsidies that may evaporate if the company attempts to improve its pricing power.
Based on the company's reported figures, LZMH operates with a razor-thin 3.3% gross margin, indicating that the cost of goods sold consumes nearly the entire revenue stream and suggesting that the firm functions more like a low-margin wholesaler than a high-tech software provider.
This minimal gross margin profile implies that the company lacks significant pricing power over its merchant partners and residential users. The current structure suggests that any volatility in procurement costs or merchant settlement terms could easily push the company into even deeper gross losses.
According to the provided financial data, LZMH's operating margin of -15.59% demonstrates that fixed administrative and R&D overheads significantly outpace the gross profit generated, indicating that the company has yet to achieve the necessary economies of scale to support its current operational footprint.
The failure of operating income to scale alongside revenue suggests that the business model is inherently capital-intensive or burdened by excessive customer acquisition costs. Without a fundamental shift in cost discipline, the company may continue to struggle with negative operating leverage as it attempts to expand its physical infrastructure.
Data indicates that LZMH maintains a cash position of only $23.47 million against $1.13 billion in annual revenue, which warrants further investigation into the company's liquidity cycle and its ability to sustain operations without immediate access to external financing or improved working capital management.
The market may be mispricing the company by focusing on top-line growth while ignoring the extreme tightness of its cash buffer relative to its massive scale. This mismatch suggests a high risk of operational disruption if the company's rapid inventory or receivable turnover cycles face any unexpected delays.
Quick answers to the most common questions about buying LZMH stock.
For fiscal year 2025, LZ Technology Holdings Limited Class B Ordinary Shares (LZMH) reported total revenue of $1.13B. This represents a 1293.1% increase compared to $81.0M in 2021.
LZ Technology Holdings Limited Class B Ordinary Shares (LZMH) reported a net loss of $173.5M for the fiscal year ending 2025.
LZ Technology Holdings Limited Class B Ordinary Shares (LZMH) reported an operating income of $-176.0M, resulting in an operating profit margin of -15.6%. This margin reflects the operational efficiency of the business before interest and taxes.
LZ Technology Holdings Limited Class B Ordinary Shares (LZMH) generated $37.2M in gross profit for the year, representing a gross profit margin of 3.3%. This demonstrates the company's core pricing power and production efficiency.