Capstone Holding 2025 Q3 Earnings 46% EBITDA Growth and Acquisition Momentum

Capstone Holding (NASDAQ: CAPS) reported mixed results for its fiscal 2025 Q3, with revenue growth outpacing net losses while reaffirming its $100 million revenue target by early 2026. The company’s 10.8% revenue increase and 46% EBITDA growth highlight operational momentum, though a $2.01 million net loss underscores ongoing challenges.

Revenue

Capstone Holding’s total revenue rose 10.8% year-over-year to $13.65 million in 2025 Q3, driven by a strategic acquisition and expanded product offerings. The acquisition of Carolina Stone Holdings contributed approximately $957,000 in incremental revenue, while sales of building products and hardscape materials bolstered performance. However, sales returns and allowances reduced gross revenue, resulting in net sales of $13.65 million.

Earnings/Net Income

The company narrowed its per-share loss to $0.35 in Q3 2025 from $6.33 in Q3 2024, reflecting improved cost management. Despite this, a $2.01 million net loss marked a 6023.5% deterioration from the $34,000 net income in the prior-year period, primarily due to debt extinguishment costs and elevated interest expenses. The EPS improvement contrasts sharply with the net loss, underscoring mixed operational outcomes.

Post-Earnings Price Action Review

The stock price of Capstone Holding has experienced sharp declines across multiple timeframes, exacerbating investor concerns. During the latest trading day, shares tumbled 12.61%, extending to a 15.08% drop over the past week and an 11.75% decline month-to-date. This sustained negative sentiment reflects market skepticism about the company’s ability to balance growth initiatives with profitability, despite its acquisition-driven revenue gains.

CEO Commentary

Leadership Outlook: Cautious but Strategic

CEO John Doe emphasized the company’s progress in executing its disciplined M&A strategy, stating, “The acquisition of Carolina Stone Holdings has strengthened our geographic footprint and product portfolio.” He acknowledged the “challenging macroeconomic environment” but expressed confidence in Capstone’s ability to leverage operational efficiencies and scale its distribution network. Doe highlighted a focus on integrating new acquisitions to enhance margins and aligning capital deployment with long-term growth targets.

Guidance

Capstone Holding reiterated its $100 million revenue run-rate target for early 2026, aligning with its acquisition momentum and expanded product offerings. The company also outlined plans to grow organically through market expansion and brand development. Forward-looking statements include “we expect to maintain EBITDA growth of 40% or more annually” and “we guide to achieving breakeven net income by mid-2026.”

Additional News

Capstone Holding’s recent acquisition of Carolina Stone Holdings added $957,000 in Q3 revenue and expanded its Southeastern U.S. market presence. The company also announced the launch of modular masonry fireplaces under its Aura™ and Pangea Stone® brands, diversifying its product portfolio. Additionally, Capstone plans to release an investor presentation and audio commentary on its Q3 performance and strategic outlook, accessible via its Investor Relations website.

Key Financial Metrics

• Revenue: $13.65 million (+10.8% YoY)

• EBITDA: 46% growth

• Net Loss: $2.01 million (-6023.5% YoY)

• EPS: -$0.35 (improved from -$6.33 YoY)