The company struggles with a structural negative gross margin profile, evidenced by a -5.6% gross margin reported in 2026Q2, indicating that direct costs consistently exceed revenue generation.
| Metric | TTM | Jun'25 | Jun'24 | Jun'23 | Jun'22 | Jun'21 | Jun'20 | Jun'19 | Jun'18 | Jun'17 | Jun'16 | Jun'15 | Jun'14 | Jun'13 | Jun'12 | Jun'11 | Jun'10 | Jun'09 | Jun'08 | Dec'06 |
|---|
| Sales/Revenue | 27.39M | 8.73M | 2.83M | 0 | 16.52M | 6.78M | 0 | 0 | 45.73M | 45.05M | 53.68M | 55.47M | 48.69M | 74.49M | 145.14M | 137.91M | 93.04M | 39.71M | 27.57M | 57.87K |
| Revenue Growth % | 1191.57% | 208.29% | - | -100% | 143.5% | - | - | -100% | 1.52% | -16.08% | -3.23% | 13.92% | -34.63% | -48.68% | 5.25% | 48.22% | 134.27% | 44.08% | 47532.7% | - |
| Cost of Goods Sold | 29.25M | 8.98M | 1.99M | 5.86M | 8.55M | 9.86M | 0 | 0 | 39.02M | 43.95M | 51.94M | 50.75M | 44.07M | 60.77M | 116.56M | 112.26M | 73.7M | 24.52M | 20.8M | 54.43K |
| COGS % of Revenue | - | 102.86% | 70.43% | - | 51.74% | 145.3% | - | - | 85.32% | 97.57% | 96.76% | 91.49% | 90.51% | 81.58% | 80.3% | 81.4% | 79.22% | 61.74% | 75.46% | 94.05% |
| Gross Profit | -5.49M | -249.5K | 837.04K | -5.86M | 7.97M | -3.07M | 0 | 0 | 6.71M | 1.09M | 1.74M | 4.72M | 4.62M | 13.72M | 28.59M | 25.64M | 19.34M | 15.2M | 6.77M | 3.44K |
| Gross Margin % | -20.04% | -2.86% | 29.57% | - | 48.26% | -45.3% | - | - | 14.68% | 2.43% | 3.24% | 8.51% | 9.49% | 18.42% | 19.7% | 18.6% | 20.78% | 38.26% | 24.54% | 5.95% |
| Gross Profit Growth % | - | -129.81% | 114.29% | -173.47% | 359.41% | - | - | -100% | 513.03% | -36.98% | -63.19% | 2.11% | -66.31% | -52.01% | 11.48% | 32.62% | 27.24% | 124.62% | 196461.48% | - |
| Operating Expenses | 29.85M | 33.11M | 27.84M | 37.84M | 86.87M | 6.48M | 5.16M | 6.66M | 10.06M | 9.87M | 11.38M | 8.44M | 19.84M | 29.9M | 38.5M | 16.6M | 5.44M | 1.72M | 1.95M | 14.37K |
| OpEx % of Revenue | - | 379.42% | 983.75% | - | 525.88% | 95.56% | - | - | 21.99% | 21.91% | 21.19% | 15.21% | 40.76% | 40.14% | 26.53% | 12.04% | 5.85% | 4.33% | 7.06% | 24.83% |
| Selling, General & Admin | 12M | 6.84M | 10.93M | 18.51M | 18.59M | 5.66M | 5.04M | 6.66M | 6.69M | 5.67M | 10.67M | 7.3M | 18.36M | 27.72M | 35.56M | 16.6M | 5.44M | 1.72M | 1.95M | 14.37K |
| SG&A % of Revenue | - | 78.4% | 386.25% | - | 112.56% | 83.5% | - | - | 14.63% | 12.59% | 19.88% | 13.15% | 37.71% | 37.21% | 24.5% | 12.04% | 5.85% | 4.33% | 7.06% | 24.83% |
| Research & Development | 0 | 0 | 0 | 121.58K | 68.28M | 817.79K | 120K | 0 | 1.18M | 846.44K | 707.49K | 1.14M | 1.48M | 2.18M | 2.95M | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | 413.32% | 12.05% | - | - | 2.58% | 1.88% | 1.32% | 2.06% | 3.05% | 2.92% | 2.03% | - | - | - | - | - |
| Other Operating Expenses | 2M | 26.27M | 16.91M | 19.21M | 0 | 0 | 0 | 0 | 2.18M | 3.35M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | -28.67M | -18.73M | -27.01M | -37.84M | -78.9M | -9.56M | -5.16M | -6.66M | -3.34M | -8.77M | -9.64M | -3.72M | -15.22M | -16.18M | -9.91M | 9.04M | 13.9M | 13.48M | 4.82M | -10.93K |
| Operating Margin % | -104.67% | -214.66% | -954.18% | - | -477.62% | -140.86% | - | - | -7.31% | -19.48% | -17.96% | -6.7% | -31.26% | -21.72% | -6.83% | 6.56% | 14.94% | 33.94% | 17.48% | -18.88% |
| Operating Income Growth % | - | 30.64% | 28.63% | 52.04% | -725.67% | -85.06% | 22.45% | -99.12% | 61.89% | 8.98% | -159.21% | 75.57% | 5.9% | -63.17% | -209.66% | -34.94% | 3.1% | 179.7% | 44202.73% | - |
| EBITDA | -15M | -13.33M | -22.74M | -31.98M | -73M | -5.84M | -5.16M | -6.66M | -2.1M | -7.59M | -7.69M | -1.59M | -12.82M | -12.88M | -5.53M | 12.94M | 16.82M | 15.84M | 6.01M | -7.5K |
| EBITDA Margin % | -54.77% | -152.77% | -803.58% | - | -441.92% | -86.06% | - | - | -4.6% | -16.86% | -14.32% | -2.87% | -26.33% | -17.29% | -3.81% | 9.38% | 18.08% | 39.89% | 21.82% | -12.96% |
| EBITDA Growth % | 75.68% | 41.39% | 28.89% | 56.19% | -1150.33% | -13.07% | 22.45% | -216.39% | 72.29% | 1.19% | -382.98% | 87.59% | 0.43% | -132.98% | -142.72% | -23.08% | 6.17% | 163.45% | 80280.43% | - |
| D&A (Non-Cash Add-back) | 12.43M | 5.4M | 4.26M | 5.86M | 5.9M | 3.72M | 0 | 0 | 1.24M | 1.18M | 1.95M | 2.13M | 2.4M | 3.3M | 4.39M | 3.9M | 2.92M | 2.36M | 1.19M | 3.43K |
| EBIT | -26.16M | -18.73M | -26.77M | -37.84M | -77.2M | -9.56M | -5.16M | -6.66M | -3.34M | -8.77M | -9.64M | -3.72M | -15.22M | -16.18M | -9.91M | 9.04M | 13.9M | 13.48M | 4.82M | -10.93K |
| Net Interest Income | -36.58M | -9.01M | -90.12K | -6.27K | -7.03K | 136 | -5.04K | -1.39K | -1.36M | -1.41M | -1.43M | -186.01K | 196.44K | -1.14M | -1.17M | -112.46K | -14.83K | -802.65K | -367.83K | 0 |
| Interest Income | 600.46K | 600.24K | 0 | 0 | 0 | 136 | 0 | 84 | 6.05K | 30.46K | 268.09K | 1.18M | 2.74M | 659.76K | 448.28K | 591.38K | 9K | 0 | 0 | 0 |
| Interest Expense | 38.05M | 9.61M | 90.12K | 6.27K | 7.03K | 0 | 5.04K | 1.48K | 1.37M | 1.44M | 1.7M | 1.36M | 2.55M | 1.8M | 1.62M | 703.84K | 23.83K | 802.65K | 367.83K | 0 |
| Other Income/Expense | -118.04M | -24.27M | 143.22K | -9.12K | 1.69M | -82.95K | -5.04K | -1.39K | -4.06M | -2.26M | -4.42M | 654.85K | 1.02M | -7.25M | 3.55M | 9.55M | 2.28M | 704.62K | 1.14M | 0 |
| Pretax Income | -151.51M | -43M | -26.86M | -37.85M | -77.21M | -9.64M | -5.17M | -6.66M | -7.4M | -11.04M | -14.06M | -3.06M | -14.2M | -23.43M | -6.36M | 18.59M | 16.18M | 14.18M | 5.96M | -10.93K |
| Pretax Margin % | -553.12% | -492.8% | -949.12% | - | -467.39% | -142.08% | - | - | -16.18% | -24.5% | -26.19% | -5.52% | -29.17% | -31.45% | -4.38% | 13.48% | 17.39% | 35.71% | 21.61% | -18.88% |
| Income Tax | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1.74M | 1.1M | 2.45M | 169.33K | -129.31K | 1.52M | 3.17M | 2.12M | 1.01M | 0 |
| Effective Tax Rate % | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | -12.41% | -35.92% | -17.22% | -0.72% | 2.03% | 8.2% | 19.62% | 14.91% | 16.99% | 0% |
| Net Income | -145.85M | -43M | -26.86M | -37.85M | -77.21M | -9.64M | -17.41M | -14.39M | -7.4M | -11.04M | -15.81M | -4.16M | -16.65M | -23.6M | -6.23M | 17.07M | 13.01M | 12.07M | 4.95M | -10.93K |
| Net Margin % | -532.45% | -492.8% | -949.12% | - | -467.39% | -142.08% | - | - | -16.18% | -24.5% | -29.45% | -7.51% | -34.19% | -31.68% | -4.29% | 12.37% | 13.98% | 30.39% | 17.94% | -18.88% |
| Net Income Growth % | -82.09% | -60.07% | 29.02% | 50.98% | -701.03% | 44.65% | -21.03% | -94.44% | 32.96% | 30.17% | -279.58% | 74.99% | 29.46% | -278.78% | -136.51% | 31.21% | 7.77% | 144.02% | 45361.92% | - |
| Net Income (Continuing) | -151.51M | -43M | -26.86M | -37.85M | -77.21M | -9.64M | -5.17M | -6.66M | -7.4M | -11.04M | -15.81M | -4.16M | -16.65M | -23.6M | -6.23M | 17.07M | 13.01M | 12.07M | 4.95M | -10.93K |
| Discontinued Operations | -8.62K | 0 | 0 | 0 | 0 | 0 | -12.25M | -7.73M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -255.79 | -11167.00 | -128537.51 | -591401.02 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | 0.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | 999999.00 | 999999.00 | 999999.00 | 999999.00 | -144005.00 |
| EPS Growth % | 99.56% | 91.31% | 78.27% | 85.45% | -187.08% | 90.54% | 39.26% | 2.04% | 48.36% | - | 100% | 80.79% | 29.48% | -278.35% | -137.17% | 28.96% | -15.19% | 146.85% | 99999900% | - |
| EPS (Basic) | - | -11167.00 | -128537.51 | -591401.02 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | 0.00 | -999999.00 | -999999.00 | -999999.00 | -999999.00 | 999999.00 | 999999.00 | 999999.00 | 999999.00 | -144005.00 |
| Diluted Shares Outstanding | 570.2K | 3.85K | 209 | 64 | 19 | 7 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Basic Shares Outstanding | 570.2K | 3.85K | 209 | 64 | 19 | 7 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
Imminent liquidity and solvency risk
As indicated by the historical income statement data, ZNB's revenue trajectory remains highly erratic, with periods of total revenue absence followed by rapid growth, such as the $16.9M reported in 2026Q2, suggesting that the current business model relies on lumpy, non-recurring transactional events rather than sustainable growth.
The extreme fluctuations in quarterly revenue suggest that the company's core entertainment and consulting segments lack a predictable recurring revenue base. Investors should monitor whether the recent revenue surge is a result of one-time contract wins or a genuine expansion of the user base, as the lack of consistent year-over-year growth patterns complicates long-term valuation.
According to the provided financial statements, ZNB consistently reports negative gross margins, including a -5.6% margin in 2026Q2, which implies that the direct costs of talent acquisition and platform maintenance currently exceed the revenue generated from these digital entertainment and educational service offerings.
This persistent negative margin profile suggests that the company's unit economics are fundamentally flawed, as it loses money on every dollar of revenue before accounting for any operating expenses. Without a significant shift in pricing power or a drastic reduction in content production costs, the current business model appears to be value-destructive at the gross profit level.
Based on reported figures, ZNB exhibits a profound lack of operating leverage, evidenced by an operating margin of -25.3% in 2026Q2, which demonstrates that administrative and overhead costs remain disproportionately high relative to the company's ability to scale its core digital entertainment and consulting revenue streams.
The company's inability to achieve positive operating income despite revenue growth suggests that SG&A expenses are not scaling efficiently with volume. This disconnect indicates that the current organizational structure may be too heavy for the existing revenue base, necessitating a potential restructuring to align fixed costs with actual output.
As highlighted by the company's precarious cash position of only $1.06M against substantial quarterly operating losses, the financial data suggests that ZNB faces an immediate risk of insolvency, which may force management to pursue dilutive financing or further pivot its business model to survive.
Short-sellers would likely focus on the company's inability to generate positive cash flow and the reliance on potentially non-core consulting revenue to bridge the gap in the entertainment segment. The lack of a clear path to profitability, combined with minimal cash reserves, warrants extreme caution regarding the company's long-term viability as a going concern.
Quick answers to the most common questions about buying ZNB stock.
For fiscal year 2025, Zeta Network Group (ZNB) reported total revenue of $8.7M. This represents a 14978.7% increase compared to $0.1M in 2007.
Zeta Network Group (ZNB) reported a net loss of $43.0M for the fiscal year ending 2025.
Zeta Network Group (ZNB) reported an operating income of $-18.7M, resulting in an operating profit margin of -214.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Zeta Network Group (ZNB) generated $-0.2M in gross profit for the year, representing a gross profit margin of -2.9%. This demonstrates the company's core pricing power and production efficiency.