Urban-Gro (UGRO) Q1 2025 earnings summary

Executive summary

• Revenues for Q1 2025 were $9.5M, down 38% year-over-year, driven by a $6.6M decline in construction design-build revenue and a $1.5M decrease in services revenue, partially offset by a $2.2M increase in equipment systems revenue.

• Gross profit fell to $0.6M (6% margin) from $3.0M (19% margin) in Q1 2024, reflecting the sharper drop in revenue versus cost reductions.

• Operating expenses decreased 14% to $4.7M, mainly due to lower personnel costs and reduced depreciation/amortization.

• Net loss widened to $4.0M ($0.31/share) from $2.6M ($0.21/share) year-over-year.

Financial highlights

• Cash at March 31, 2025 was $0.7M, down from $0.8M at year-end 2024.

• Negative working capital increased to $30.1M from $26.5M at December 31, 2024.

• Net cash provided by operating activities was $2.2M, with $0.1M from investing and $2.3M used in financing.

• Stockholders’ deficit increased to $28.2M from $24.6M at year-end.

Outlook and guidance

• Management has taken steps to improve liquidity, including cost reductions and headcount decreases, and may seek additional equity or debt financing.

• Substantial doubt about going concern was alleviated by recent actions, but ongoing losses and negative cash flow remain risks.