Nukkleus Inc. Reports $102.96 Million Net Income Turnaround, Shifts Focus to Defense Sector

Nukkleus Inc. reported significant financial changes in its latest 10-Q filing for the quarter ending March 31, 2025. The company achieved a net income of $102.96 million, a substantial turnaround from a net loss of $2.43 million in the same period last year. This remarkable shift was primarily driven by a gain of $104.28 million from changes in the fair value of stock purchase warrant liabilities. Total revenues remained unchanged at $0, as the company has ceased its general support services and financial services operations, focusing instead on its strategic shift towards the defense sector.

In terms of operational metrics, Nukkleus reported a working capital deficit of approximately $56.25 million as of March 31, 2025, with cash reserves of $4.46 million. The company’s accumulated deficit has decreased to $98.12 million from $201.08 million at the end of the previous fiscal period. The filing also indicated a significant reduction in operating expenses, which totaled $1.51 million, down from $2.09 million a year earlier, reflecting a decrease in professional fees and other administrative costs.

Strategically, Nukkleus has undergone notable organizational changes, including the termination of its general support services in January 2024 and the planned acquisition of a 51% interest in Star 26 Capital Inc., a company involved in defense products. This acquisition is part of a broader strategy to pivot towards the defense sector, following the sale of its payment services subsidiary for a nominal fee. The company has also changed its fiscal year-end from September 30 to December 31, effective January 1, 2024, to align its reporting with the calendar year.

The company’s operational focus has shifted significantly, with the cessation of its previous business lines and a new emphasis on defense-related activities. As of March 31, 2025, Nukkleus had 5,013,863 shares of common stock outstanding, reflecting an increase from 4,930,531 shares at the end of 2024. The company’s employee headcount and customer engagement metrics were not disclosed in the filing, but the strategic pivot suggests a reallocation of resources towards the new business focus.

Looking ahead, Nukkleus has expressed concerns regarding its liquidity and ability to continue as a going concern, citing the need for additional capital to support its operations. The company’s management has indicated that its future success will depend on achieving profitable operations and generating sufficient cash flow. The filing underscores the risks associated with its current financial position and the potential need for further financing, which could dilute existing shareholders.