Track Group Reports Q2 Fiscal 2025 Revenue of $8.35 Million, Net Loss Improves

Track Group, Inc. reported its financial results for the second quarter of fiscal 2025, revealing a total revenue of $8.35 million for the three months ended March 31, 2025, a decrease of approximately 7% from $8.99 million in the same period last year. The decline in revenue was primarily attributed to a reduction in monitoring services, particularly in Virginia, and the impact of the recently sold Chilean subsidiary. However, product sales saw a significant increase, rising 108% to $484,345, driven by international sales, particularly to Chile.

The company's cost of revenue also decreased, totaling $4.24 million for the quarter, down 16% from $5.02 million in the prior year. This reduction was largely due to lower device repair and monitoring center costs, as well as a shift to handling some device repairs internally. Gross profit for the quarter increased to $4.11 million, resulting in a gross margin of approximately 49%, compared to 44% in the previous year. Operating expenses decreased to $4.07 million, down 17% from $4.92 million, leading to an operating income of $44,043, a significant turnaround from the operating loss of $955,179 reported in the same quarter last year.

Despite the positive operational metrics, Track Group reported a net loss attributable to common shareholders of $517,116 for the quarter, an improvement from a loss of $1.90 million in the same period last year. The decrease in net loss was attributed to improved operating income and favorable currency exchange rate movements. For the six months ended March 31, 2025, the company recorded a net loss of $2.53 million, compared to a loss of $1.90 million for the same period in 2024.

In terms of strategic developments, Track Group completed the sale of its Chilean subsidiary in November 2024, which resulted in a loss of $66,483 recognized in the financial statements. The company continues to focus on expanding its monitoring services and product offerings, with a particular emphasis on recurring subscription-based revenue models. As of March 31, 2025, Track Group had unrestricted cash of $3.42 million and working capital of $4.13 million, indicating a stable liquidity position. The company expects to fund its operations through existing cash and operational cash flows in the upcoming months, while also navigating the challenges posed by global supply chain conditions and currency fluctuations.