Revenue growth remains under pressure with a 34.3% year-over-year contraction in 2025Q2, while gross margins have compressed to 27.4% from historical highs of 33.2% in 2023Q2.
| Sales/Revenue | 61.17M | 60.05M | 74.19M | 81.72M | 84.97M | 82.04M | 47.15M | 15.97M |
| Revenue Growth % | -27.22% | -19.06% | -9.22% | -3.83% | 3.58% | 73.99% | 195.28% | - |
| Cost of Goods Sold | 44.75M | 44.56M | 53.12M | 57.2M | 66.49M | 48.92M | 27.98M | 6.76M |
| COGS % of Revenue | - | 74.22% | 71.6% | 70% | 78.25% | 59.63% | 59.33% | 42.34% |
| Gross Profit | 16.42M | 15.48M | 21.07M | 24.51M | 18.48M | 33.12M | 19.17M | 9.21M |
| Gross Margin % | 26.84% | 25.78% | 28.4% | 30% | 21.75% | 40.37% | 40.67% | 57.66% |
| Gross Profit Growth % | - | -26.51% | -14.06% | 32.63% | -44.19% | 72.71% | 108.27% | - |
| Operating Expenses | 12.88M | 14.74M | 18.31M | 59.06M | 26.15M | 22.71M | 4.76M | 1.66M |
| OpEx % of Revenue | - | 24.55% | 24.68% | 72.27% | 30.77% | 27.68% | 10.1% | 10.39% |
| Selling, General & Admin | 3.23M | 5.74M | 3.01M | 20.44M | 5.55M | 6.21M | 2.48M | 1.42M |
| SG&A % of Revenue | - | 9.55% | 4.05% | 25.02% | 6.53% | 7.57% | 5.27% | 8.9% |
| Research & Development | 9.65M | 9M | 15.3M | 22.71M | 13.58M | 16.84M | 2.28M | 238.23K |
| R&D % of Revenue | - | 14.99% | 20.63% | 27.79% | 15.99% | 20.53% | 4.83% | 1.49% |
| Other Operating Expenses | 3 | 0 | 0 | 15.9M | 7.01M | -344.83K | 0 | 0 |
| Operating Income | 3.53M | 742.37K | 2.76M | -34.54M | -7.67M | 10.41M | 14.41M | 7.55M |
| Operating Margin % | 5.78% | 1.24% | 3.72% | -42.27% | -9.02% | 12.69% | 30.57% | 47.26% |
| Operating Income Growth % | - | -73.09% | 107.99% | -350.59% | -173.65% | -27.79% | 90.97% | - |
| EBITDA | 3.58M | 939.47K | 2.8M | -34.4M | -6.33M | 11.92M | 15.15M | 7.97M |
| EBITDA Margin % | 5.85% | 1.56% | 3.78% | -42.09% | -7.44% | 14.53% | 32.13% | 49.94% |
| EBITDA Growth % | 111.48% | -66.5% | 108.15% | -443.77% | -153.07% | -21.32% | 89.98% | - |
| D&A (Non-Cash Add-back) | 46.04K | 197.1K | 45.4K | 146.7K | 1.34M | 1.51M | 735.12K | 426.4K |
| EBIT | 3.53M | 742.37K | 2.76M | -18.64M | -652.12K | 8.85M | 14.41M | 7.55M |
| Net Interest Income | 6.31M | -299.72K | 3.62M | 460.69K | 41.86K | 209.69K | -148.18K | -11.85K |
| Interest Income | 6.31M | 235.61K | 3.73M | 548.25K | 107.84K | 487.19K | 15.35K | 0 |
| Interest Expense | 0 | 535.33K | 109.23K | 86.58K | 65.98K | 277.5K | 163.41K | 11.85K |
| Other Income/Expense | 6.13M | 18.45M | 5.34M | -2.61M | 366.6K | -1.84M | -25.66K | -727.11K |
| Pretax Income | 9.66M | 19.19M | 8.02M | -37.15M | -7.3M | 8.57M | 14.39M | 6.82M |
| Pretax Margin % | 15.8% | 31.96% | 10.81% | -45.46% | -8.59% | 10.45% | 30.51% | 42.71% |
| Income Tax | 1.04M | 1.04M | 840.94K | 352.28K | -550.8K | 84.82K | 374.8K | 584.7K |
| Effective Tax Rate % | 10.76% | 5.44% | 10.49% | -0.95% | 7.55% | 0.99% | 2.61% | 8.57% |
| Net Income | 6.79M | 16.21M | 5.29M | -37.79M | -6.79M | 8.57M | 14.01M | 6.24M |
| Net Margin % | 11.11% | 26.99% | 7.13% | -46.24% | -7.99% | 10.44% | 29.72% | 39.05% |
| Net Income Growth % | 122.75% | 206.4% | 114% | -456.45% | -179.26% | -38.86% | 124.75% | - |
| Net Income (Continuing) | 8.62M | 18.15M | 7.29M | -37.5M | -6.75M | 8.48M | 14.01M | 6.24M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 3.19M | 4.44M | 2.45M | 536.22K | 255.66K | 243.23K | 319.61K | 0 |
| EPS (Diluted) | 2.45 | 2.12 | 0.55 | -166.02 | -34.94 | 39.07 | 63.86 | 29.45 |
| EPS Growth % | 101.22% | 285.45% | 100.33% | -375.16% | -189.43% | -38.82% | 116.84% | - |
| EPS (Basic) | - | 2.12 | 1.44 | -166.02 | -34.94 | 39.07 | 63.86 | 29.45 |
| Diluted Shares Outstanding | 2.78M | 7.66M | 9.66M | 228.09K | 199.3K | 219.28K | 219.28K | 211.75K |
| Basic Shares Outstanding | 2.78M | 7.66M | 9.68M | 228.09K | 199.3K | 219.28K | 219.28K | 211.75K |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - |
Revenue concentration and contraction
As indicated by the most recent quarterly filings, MicroAlgo's revenue has experienced a sustained decline, with the latest period showing a 34.3% year-over-year drop, reflecting significant challenges in maintaining market share within the competitive Chinese digital advertising and gaming infrastructure sectors.
The consistent double-digit revenue decay suggests that the company's algorithm optimization services are struggling to gain traction or are facing aggressive pricing pressure from larger cloud-native competitors. Investors should monitor whether this downward trajectory is a result of intentional portfolio pruning or a fundamental loss of competitive relevance in the Shenzhen tech ecosystem.
Based on the reported financial data, MicroAlgo's gross margins have compressed from historical highs of 33.2% in 2023Q2 to 27.4% in 2025Q2, highlighting the inherent difficulty in scaling a business model that relies heavily on lower-margin hardware resale alongside software services.
The inability to maintain gross margins above 30% suggests that the company lacks the pricing power typically associated with high-end software providers. This margin profile appears to be structurally capped by the procurement costs of the intelligent chips segment, which likely dilutes the profitability of the core algorithm services.
According to the income statement analysis, the company's net margin of 14.1% significantly exceeds its operating margin of 4.2%, suggesting that a substantial portion of reported profitability is derived from non-operating sources rather than core operational efficiency.
This discrepancy warrants caution, as it implies that the bottom line is heavily supported by interest income generated from the company's large cash reserves. Analysts should discount these non-operating gains when evaluating the underlying health of the algorithm services business, which appears to be operating at razor-thin margins.
As reported in recent financial statements, MicroAlgo has successfully reduced its R&D expenditure from $7.5 million in 2023Q2 to $2.3 million in 2025Q2, demonstrating a reactive cost-cutting strategy designed to preserve liquidity while top-line growth remains under significant pressure.
While this reduction in R&D spending has helped stabilize operating income, it may also indicate a strategic pivot away from aggressive innovation. Investors should investigate whether this austerity measure will impair the company's ability to maintain its competitive edge in algorithm optimization over the long term.
While the company maintains a fortress-like balance sheet with $174.8 million in cash, the persistent revenue decline suggests that the market may be overvaluing the firm's core operations by failing to separate the cash-yield from the underlying business performance.
Short-sellers would likely focus on the fact that the core business is essentially a break-even operation that is failing to grow. The lack of clear capital deployment strategies for the massive cash pile raises questions about whether management intends to pivot the business or simply manage the decline of its current service offerings.
Quick answers to the most common questions about buying MLGO stock.
For fiscal year 2025, MicroAlgo Inc. (MLGO) reported total revenue of $60.0M. This represents a 276.0% increase compared to $16.0M in 2019.
MicroAlgo Inc. (MLGO) is profitable, generating $16.2M in net income for the fiscal year ending 2025 with a net profit margin of 27.0%.
MicroAlgo Inc. (MLGO) reported an operating income of $0.7M, resulting in an operating profit margin of 1.2%. This margin reflects the operational efficiency of the business before interest and taxes.
MicroAlgo Inc. (MLGO) generated $15.5M in gross profit for the year, representing a gross profit margin of 25.8%. This demonstrates the company's core pricing power and production efficiency.