Roth Capital Maintains Buy Rating on zSpace with Lower PT of $5

Roth Capital Maintains Buy Rating on zSpace with Lower PT of $5

Roth Capital Partners has maintained its Buy rating on zSpace Inc. (NASDAQ:ZSPC) despite a recent earnings report that missed expectations and led to a decline in stock prices. The investment firm has, however, lowered its price target for the company to $5.00, down from a previous target of $6.00.

zSpace reported its second-quarter 2025 earnings on August 14, revealing a decrease in revenue and a subsequent dip in stock prices. The company announced an earnings per share (EPS) of -$0.16, missing expectations, as revenue fell short of forecasts at $7.46 million versus the anticipated $9.38 million. Following the announcement, zSpace’s stock declined by 3.79% in after-hours trading [1].

Despite the challenges, Roth Capital maintains an optimistic view on zSpace's long-term prospects. The firm highlights the company's focus on leveraging machine learning in its next-generation stylus and expanding its product offerings. Additionally, Roth Capital notes that zSpace's gross margins have improved, reaching 44.9% year-over-year, driven by higher gross margins [2].

Roth Capital's decision to lower the price target reflects the current market conditions and the company's recent performance. However, the firm remains bullish on zSpace's ability to navigate the challenges in the K-12 education sector and capitalize on the growth opportunities in immersive learning technologies.

References:
[1] https://www.marketbeat.com/earnings/reports/2025-8-14-zspace-inc-stock/
[2] https://www.investing.com/news/transcripts/earnings-call-transcript-zspace-q2-2025-reports-revenue-decline-stock-dips-93CH-4194518