FGI Industries Reports 5.5% Revenue Growth but Faces Increased Net Loss in Q2 2025

FGI Industries Ltd. reported its financial results for the second quarter of 2025, revealing a revenue increase of 5.5% to $31.0 million compared to $29.4 million in the same period last year. For the first half of 2025, revenue rose by 6.8% to $64.2 million, up from $60.1 million in the prior year. Despite the revenue growth, the company experienced a net loss of $1.4 million for the quarter, a significant increase from a loss of $23,000 in the same quarter of 2024. The loss for the first half of 2025 was $2.2 million, compared to a loss of $561,000 in the previous year.

The financial performance reflects a challenging operational environment, with gross profit margins declining to 28.1% for the second quarter, down from 30.5% in the same quarter of 2024. The increase in costs, particularly in selling and distribution expenses, which rose by 0.8% to $6.2 million, and general and administrative expenses, which increased by 8.5% to $2.8 million, contributed to the overall loss. The company also noted a significant rise in interest expenses due to higher average loan balances.

In terms of strategic developments, FGI Industries has focused on product innovation and geographic expansion. The company launched new product lines, including anti-overflow toilets and custom kitchen cabinetry, which have begun to generate increased revenue. Additionally, FGI has entered into a licensing agreement for advanced toilet technology and is expanding its market presence in India, Eastern Europe, and the UK. The company’s operational metrics indicate a strong customer base, with sanitaryware sales accounting for 58.3% of total revenue in the second quarter.

However, FGI Industries faces liquidity challenges, with approximately $2.5 million in cash and $12.6 million in outstanding loans as of June 30, 2025. The company is currently in discussions with lenders regarding compliance with financial covenants related to its credit facilities. In response to these challenges, FGI has implemented cost control initiatives and terminated a lease for an underutilized warehouse to reduce overhead expenses. Management remains optimistic about improving liquidity and operational efficiency in the coming months.

Looking ahead, FGI Industries aims to continue its focus on product innovation and market expansion while navigating the pressures from tariffs and rising costs. The company believes it has sufficient liquidity to meet its working capital needs over the next twelve months, although it acknowledges the uncertainty surrounding market conditions and regulatory changes that could impact its operations.