Ten Holdings 2025 Q1 Earnings Misses Targets as Net Loss Widens by 1094%

Ten Holdings (XHLD) reported its fiscal 2025 Q1 earnings on May 20th, 2025. Ten Holdings experienced a substantial decline in performance, missing targets with a notable decrease in revenue and a significant widening of net loss. The company did not meet expectations, as it faced financial difficulties from IPO-related expenses. Looking forward, Ten Holdings plans strategic investments to enhance its platform and pursue acquisitions, aiming to improve its competitive position and drive future growth.

Revenue

In the first quarter of 2025, Ten Holdings reported a total revenue of $739,000, marking a 34.5% decline from $1.128 million in the same period of the previous year. The decrease was largely due to a non-repeating event series and customer events from the prior year. Specifically, the virtual and hybrid events segment contributed $713,000, while physical events added $26,000 to the total revenue.

Earnings/Net Income

Ten Holdings faced deeper losses, recording a net loss of $4.84 million for Q1 2025, a stark increase from the $405,000 loss in Q1 2024. This translates to a loss of $0.18 per share, significantly wider than the $0.02 per share loss in the previous year, primarily influenced by increased SG&A expenses. The EPS results indicate a challenging financial situation for the company.

Price Action

The stock price of Ten Holdings has jumped 8.01% during the latest trading day, has plummeted 54.22% during the most recent full trading week, and has plummeted 16.06% month-to-date.

Post-Earnings Price Action Review

The strategy of buying XHLD following a revenue miss and holding for 30 days proved to be ineffective, yielding a negative return of -15.57%. This performance was starkly contrasted by a benchmark return of 1.03%, resulting in an excess return of -16.60%. The approach also faced a significant maximum drawdown of -37.22%, illustrating considerable risk and unfavorable results. With a Sharpe ratio of -0.39, the strategy demonstrated notable volatility and negative returns, suggesting that investors should be cautious when considering this approach in the future. Overall, the strategy underscored the challenges and risks associated with investing in Ten Holdings under these conditions.

CEO Commentary

"During the first quarter of 2025, the Company continued to execute its business strategies and lay the groundwork for future growth. We now expect to be in a better position to achieve key objectives such as strengthening customer relationships, increasing investment in digital marketing, and expanding our sales team. We believe we are also better equipped to perform R&D that will enable us to introduce additional interactive and data analytics features to our proprietary Xyvid Pro Platform, further develop our PaaS model, and integrate conversational AI into our offerings. These steps will provide us with competitive advantages, margin expansion, customer growth, and predictable cash flow generation that will drive revenue growth and bottom-line improvements going forward," commented TEN Holdings’ Chief Executive Officer, Randy Jones.

Guidance

The Company expects to continue implementing a go-to-market strategy with investments in a new sales executive, realignment of its sales force, and digital advertising campaigns to drive engagement. It plans to focus on recurring revenue streams through further development of the platform-as-a-service (PaaS) model. The Company aims to enhance the Xyvid Pro Platform by introducing interactive features, integrating advanced data analytics, and improving scalability and flexibility. Additionally, the Company plans to identify, invest in, partner with, and acquire businesses that offer complementary and strategic advantages to enhance overall competitiveness and growth.

Additional News

Recently, TEN Holdings announced a $1 million stock repurchase program, effective March 17, 2025, to enhance shareholder value and operational efficiency. The program is funded through cash generated from operations and allows for selective repurchases under SEC rules. CEO Randolph Wilson Jones III expressed confidence in the company's long-term value, reinforcing TEN Holdings' commitment to shareholder interests. Additionally, TEN Holdings sponsored the CancerCare® Spring Gala, aligning with its community impact goals and strengthening its presence in the healthcare sector. The company also participated in The D. Boral Capital Inaugural Global Conference, engaging with potential investors to showcase its growth strategy and competitive advantages.