Despite a 38.1% revenue increase in 2025Q4, the company continues to struggle with profitability, reporting a net loss of $77.1 million and an operating margin of -4.5%.
| Sales/Revenue | 1.82B | 1.33B | 2.5B | 4.22B | 6.17B | 6.08B | 5.8B | 3.79B | 2B | 1.63B | 925.38M |
| Revenue Growth % | 36.12% | -46.61% | -40.76% | -31.67% | 1.43% | 4.93% | 53.04% | 89.63% | 22.68% | 75.94% | - |
| Cost of Goods Sold | 1.1B | 820.57M | 1.84B | 3.4B | 4.88B | 4.82B | 4.33B | 2.81B | 1.52B | 1.34B | 811.23M |
| COGS % of Revenue | 60.8% | 61.54% | 73.83% | 80.61% | 79.11% | 79.29% | 74.75% | 74.23% | 75.86% | 82.26% | 87.66% |
| Gross Profit | 711.63M | 512.88M | 653.7M | 817.22M | 1.29B | 1.26B | 1.46B | 976.09M | 482.26M | 288.86M | 114.16M |
| Gross Margin % | 39.2% | 38.46% | 26.17% | 19.39% | 20.89% | 20.71% | 25.25% | 25.77% | 24.14% | 17.74% | 12.34% |
| Gross Profit Growth % | 38.75% | -21.54% | -20.01% | -36.59% | 2.29% | -13.93% | 49.96% | 102.4% | 66.95% | 153.03% | - |
| Operating Expenses | 916.56M | 857.92M | 869.22M | 1.23B | 1.2B | 1.1B | 844.74M | 596.1M | 304.87M | 274.86M | 155.57M |
| OpEx % of Revenue | 50.5% | 64.34% | 34.8% | 29.29% | 19.39% | 18.01% | 14.57% | 15.74% | 15.26% | 16.88% | 16.81% |
| Selling, General & Admin | 582.64M | 520.85M | 504.69M | 708.46M | 687.6M | 586.59M | 415.08M | 322.61M | 154.91M | 136.47M | 92.03M |
| SG&A % of Revenue | 32.1% | 39.06% | 20.21% | 16.81% | 11.15% | 9.64% | 7.16% | 8.52% | 7.76% | 8.38% | 9.94% |
| Research & Development | 317.73M | 337.07M | 364.53M | 526.2M | 508.41M | 508.64M | 429.66M | 273.49M | 149.96M | 138.39M | 63.54M |
| R&D % of Revenue | 17.5% | 25.28% | 14.6% | 12.48% | 8.24% | 8.36% | 7.41% | 7.22% | 7.51% | 8.5% | 6.87% |
| Other Operating Expenses | 16.2M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | -204.93M | -345.04M | -215.52M | -417.45M | 92.73M | 164.69M | 619.04M | 379.99M | 177.39M | 14M | -41.41M |
| Operating Margin % | -11.29% | -25.88% | -8.63% | -9.9% | 1.5% | 2.71% | 10.68% | 10.03% | 8.88% | 0.86% | -4.47% |
| Operating Income Growth % | 40.61% | -60.1% | 48.37% | -550.2% | -43.7% | -73.4% | 62.91% | 114.21% | 1167.19% | 133.81% | - |
| EBITDA | -173.22M | -308.4M | -161.09M | -357.8M | 143.94M | 190.33M | 636.21M | 386.45M | 181.02M | 16.51M | -41.11M |
| EBITDA Margin % | -9.54% | -23.13% | -6.45% | -8.49% | 2.33% | 3.13% | 10.98% | 10.2% | 9.06% | 1.01% | -4.44% |
| EBITDA Growth % | 43.83% | -91.44% | 54.98% | -348.58% | -24.38% | -70.08% | 64.63% | 113.49% | 996.52% | 140.15% | - |
| D&A (Non-Cash Add-back) | 31.71M | 36.64M | 54.43M | 59.65M | 51.21M | 25.65M | 17.17M | 6.46M | 3.62M | 2.51M | 294.19K |
| EBIT | -223.19M | -382.3M | -197.31M | -321.07M | 149.59M | 251.11M | 650.61M | 401.69M | 187.07M | 30.19M | -40M |
| Net Interest Income | -29.24M | -13.73M | -25.93M | -45.45M | -27.83M | 43.6M | 33.39M | 12.05M | 2.93M | 788.69K | 263.23K |
| Interest Income | 10.7M | 26.81M | 21.86M | 12.55M | 16.47M | 43.6M | 33.39M | 12.05M | 2.93M | 788.69K | 263.23K |
| Interest Expense | 39.94M | 40.54M | 47.79M | 58M | 44.3M | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -58.2M | -108.55M | -21.7M | 56.34M | 53.06M | 81.93M | 30.46M | 23.51M | 12.42M | 14.28M | 1.41M |
| Pretax Income | -263.13M | -453.59M | -237.22M | -361.11M | 145.78M | 246.62M | 649.5M | 403.5M | 189.81M | 28.28M | -40M |
| Pretax Margin % | -14.5% | -34.02% | -9.5% | -8.57% | 2.36% | 4.05% | 11.2% | 10.65% | 9.5% | 1.74% | -4.32% |
| Income Tax | 17.79M | 99.99M | -17.2M | -67.03M | 10.61M | 29.45M | 77.68M | 54.07M | 26.92M | 3.23M | -925.94K |
| Effective Tax Rate % | -6.76% | -22.04% | 7.25% | 18.56% | 7.28% | 11.94% | 11.96% | 13.4% | 14.18% | 11.42% | 2.31% |
| Net Income | -280.92M | -554.13M | -220.49M | -293.37M | 136.02M | 216.27M | 573.64M | 353.31M | 163.46M | 25.05M | -39.07M |
| Net Margin % | -15.48% | -41.56% | -8.83% | -6.96% | 2.2% | 3.56% | 9.9% | 9.33% | 8.18% | 1.54% | -4.22% |
| Net Income Growth % | 49.3% | -151.32% | 24.84% | -315.68% | -37.11% | -62.3% | 62.36% | 116.14% | 552.61% | 164.1% | - |
| Net Income (Continuing) | -280.92M | -553.58M | -220.02M | -294.08M | 135.18M | 217.17M | 571.82M | 349.44M | 162.89M | 25.05M | -39.07M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 8.31M | 13.25M | 12.22M | 13.08M | 0 | -3.13M | -1.34M | 2.42M | 0 | 0 |
| EPS (Diluted) | -283.04 | -34.16 | -1.96 | -2.71 | 1.31 | 2.16 | 35.84 | 8.12 | 0.65 | -3.52 | -19.59 |
| EPS Growth % | -728.57% | -1642.86% | 27.68% | -306.87% | -39.35% | -93.97% | 341.38% | 1149.23% | 118.47% | 82.03% | - |
| EPS (Basic) | -283.04 | -34.16 | -1.96 | -2.71 | 1.38 | 2.25 | 37.61 | 8.57 | 0.68 | -3.49 | -19.59 |
| Diluted Shares Outstanding | 993.87K | 16.18M | 15.2M | 15.39M | 16.52M | 16.27M | 16.15M | 14.06M | 14.86M | 14.86M | 14.86M |
| Basic Shares Outstanding | 993.87K | 16.18M | 15.2M | 15.39M | 15.76M | 15.53M | 15.4M | 13.98M | 14.86M | 14.86M | 14.86M |
| Dividend Payout Ratio | - | - | - | - | - | - | 0.79% | - | - | - | - |
Persistent Operating Margin Erosion
According to the most recent quarterly filings, Zepp Health achieved a 38.1% year-over-year revenue increase to $598.1 million, signaling a recovery from the sharp contractions observed throughout 2024, though this growth appears heavily reliant on aggressive promotional activity rather than sustainable organic demand expansion.
The recent acceleration in top-line growth suggests that the company is successfully capturing market share in the competitive wearable space. However, investors should monitor whether this trajectory is driven by high-volume, low-margin product cycles or a genuine shift toward higher-ASP self-branded devices.
Based on the provided income statement data, Zepp maintained a gross margin of 41.0% in 2025Q4, demonstrating a resilient ability to manage component costs despite the significant fluctuations in quarterly revenue volume that have characterized the company's recent operational history.
While the 41% margin appears healthy for a consumer electronics firm, it likely masks a challenging mix shift between the low-margin Xiaomi contract business and the higher-margin Amazfit line. The inability to translate this gross profitability into positive operating income suggests that the company's pricing power remains insufficient to cover its substantial fixed-cost base.
As reported in financial statements, Zepp's operating expenses, specifically the $191.8 million in SG&A for 2025Q4, continue to outpace gross profit growth, resulting in a persistent operating loss that indicates a lack of meaningful operating leverage in the current business model.
The company's inability to scale operating income alongside revenue suggests that the cost of customer acquisition and R&D remains disproportionately high. This trend warrants further investigation into whether management can achieve a break-even point without sacrificing the brand-building investments necessary for long-term viability.
Data from the 2025Q4 income statement reveals $17.4 million in stock-based compensation, which, when combined with recurring operating losses, suggests that the reported net loss of $77.1 million may understate the true economic cost of operations for shareholders.
The reliance on equity-based incentives during a period of negative net margins may indicate a misalignment between management compensation and bottom-line performance. Investors should be cautious of how these non-cash charges impact the long-term dilution profile of the company as it attempts to navigate its current strategic pivot.
Based on the latest quarterly figures, Zepp's R&D expenditure of $77.1 million remains a significant drag on the income statement, reflecting a strategic commitment to proprietary technology that has yet to yield the necessary scale to achieve operational profitability.
The high fixed-cost structure appears to be a deliberate choice to prioritize long-term ecosystem development over immediate earnings. However, the lack of expense discipline in SG&A suggests that the company may be over-investing in marketing relative to the current conversion rates of its self-branded product lines.
Quick answers to the most common questions about buying ZEPP stock.
For fiscal year 2025, Zepp Health Corporation (ZEPP) reported total revenue of $1.82B. This represents a 96.2% increase compared to $925.4M in 2015.
Zepp Health Corporation (ZEPP) reported a net loss of $280.9M for the fiscal year ending 2025.
Zepp Health Corporation (ZEPP) reported an operating income of $-204.9M, resulting in an operating profit margin of -11.3%. This margin reflects the operational efficiency of the business before interest and taxes.
Zepp Health Corporation (ZEPP) generated $711.6M in gross profit for the year, representing a gross profit margin of 39.2%. This demonstrates the company's core pricing power and production efficiency.