Castellum Reports 22% Revenue Growth in Q2 2025, Despite Net Loss Improvement

Castellum, Inc. reported a significant increase in financial performance for the second quarter of 2025, with revenues reaching $14.0 million, a 22% increase from $11.5 million in the same period last year. For the first half of 2025, total revenues amounted to $25.7 million, up 12% from $22.9 million in the first half of 2024. The growth was primarily attributed to a substantial contract awarded to its subsidiary, Global Technology and Management Resources, Inc., for Special Missions Management services, which contributed to additional direct labor growth on existing contracts. Despite the revenue increase, the company reported a net loss of $348,927 for the second quarter, a significant improvement from a loss of $1.9 million in the prior year, and a net loss of $1.5 million for the first half of 2025, compared to a loss of $6.0 million in the same period last year.

Operationally, Castellum has made strategic moves to enhance its market position, including the divestiture of its subsidiary, Mainnerve Federal Services, Inc., in September 2024. The company has also focused on reducing operating expenses, which fell by 13% to $5.4 million in the second quarter, driven by cost-saving initiatives and a decrease in non-cash stock-based compensation. The total operating expenses for the first half of 2025 were $11.5 million, down 14% from the previous year. The company’s gross profit for the second quarter was $5.1 million, reflecting an 8% increase year-over-year, while the gross profit margin was impacted by rising costs associated with subcontractor labor.

Castellum's customer base remains concentrated, with three U.S. government customers accounting for 70% of revenue in the first half of 2025. The company reported a total backlog of $202 million, which includes funded, unfunded, and priced options, indicating a robust pipeline for future revenue. The company expects to recognize approximately 22% of this backlog over the next 12 months. However, it acknowledged potential risks related to government spending cuts and delays in the appropriations process, which could affect future contract awards and funding.

In terms of liquidity, Castellum ended the second quarter with $14.7 million in cash, an increase from $12.0 million at the end of 2024. The company has actively engaged in financing activities, including public offerings that raised approximately $9.5 million in gross proceeds during the first half of 2025. These funds are intended for working capital and general corporate purposes. Looking ahead, Castellum remains focused on leveraging its existing contracts and exploring further acquisition opportunities to enhance its capabilities in cybersecurity and information technology, while navigating the challenges posed by the current political and economic landscape.