Algorhythm Holdings 2025 Q3 Earnings Severe Loss Amid 1,273% Revenue Surge

Algorhythm Holdings reported Q3 2025 earnings marked by a dramatic 1,273% revenue increase to $1.74 million, driven by SemiCab’s expansion. However, the company swung to a $1.15-per-share loss, a 984.6% decline from prior-year profits. Guidance for Q4 revenue of $2 million and a 2026 annualized run rate of $15–$20 million signals cautious optimism despite ongoing losses.

Revenue

Algorhythm Holdings achieved a remarkable 1,273% year-over-year revenue surge in Q3 2025, reaching $1.74 million from $127,000 in the prior-year period. This growth was fueled by the acquisition and expansion of SemiCab India, which saw its active fleet grow to 450 trucks, positioning it to generate over $23 million in annual revenue at full utilization. The company also benefited from cost reductions, with operating expenses dropping by over 33% to $1.2 million.

Earnings/Net Income

The company reported a net loss of $2.98 million in Q3 2025, a 406.2% deterioration from a $974,000 profit in 2024 Q3. Earnings per share turned negative to $1.15, a 984.6% decline from $0.13 in the prior-year quarter. Despite improved revenue and cost controls, persistent losses highlight ongoing financial challenges. The EPS decline reflects structural inefficiencies and the high costs of scaling AI-driven logistics operations.

Price Action

The stock price of Algorhythm Holdings plummeted 16.94% on the day of the earnings report, 36.93% over the subsequent week, and 30.91% month-to-date. This sharp decline underscores investor skepticism about the company’s ability to sustain profitability despite revenue growth.

Post-Earnings Price Action Review

The strategy of buying Algorhythm Holdings (RIME) shares after a revenue drop quarter-over-quarter on the financial report release date and holding for 30 days shows poor performance. The 3-year percentage change is -27.5%, significantly underperforming the market. This indicates a challenging period for RIME, with the stock price declining by 33.4% over the 3 years, showing persistent weakness in the aftermath of the revenue drops.

CEO Commentary

Gary Atkinson, CEO, emphasized Algorhythm’s transition to a “lean, technology-first” AI-driven logistics platform post-Singing Machine divestiture. He highlighted SemiCab’s mission to reduce global empty truck mileage and cited India’s 85% utilization rates as proof of concept. Q3 revenue growth was driven by four new Fortune 500 clients and five contract expansions. The SemiCab Apex SaaS platform, with 90%-95% gross margins, is central to scaling the U.S. market.

Guidance

Algorhythm expects Q4 2025 SemiCab revenue of ~$2 million and an annualized run rate of $15–$20 million by late 2026. The CFO noted a $1.7 million Q3 revenue boost from the SMCB Solutions acquisition and anticipates narrowing gross losses as revenue scales. The CEO outlined plans to expand SemiCab Apex in the U.S., targeting enterprise shippers and 3PLs, leveraging high-margin SaaS for rapid deployment.

Additional News

Algorhythm Holdings completed the sale of its Singing Machine business to Stingray Group for $4.5 million, eliminating millions in annual expenses and enabling a strategic shift to AI logistics. The company also launched the Apex SaaS platform, targeting the $450 billion U.S. full-truckload market. Additionally, board member Jay B. Foreman resigned on November 14, 2025, citing no disagreements with company operations.

Financial Highlights

The company’s cash balance stood at $2.8 million as of September 30, 2025, with access to a Bank of America supply chain finance facility to support working capital. Despite improved liquidity, the net loss of $1.9 million from continuing operations reflects ongoing challenges in achieving profitability. SemiCab’s 1,300% YoY revenue growth in India underscores its potential, but U.S. expansion remains critical for long-term success.

Strategic Outlook

Algorhythm’s pivot to AI-driven logistics positions it to capitalize on high-margin SaaS opportunities, particularly with the Apex platform. However, execution risks, including market adoption of the SaaS model and fleet utilization rates, remain key concerns. The company’s ability to scale SemiCab’s U.S. operations and maintain disciplined cost management will determine its path to profitability.