Hennessy Advisors 2025 Q4 Earnings Earnings Rise 3.9% Despite Revenue Decline

Hennessy Advisors (HNNA) reported mixed results for fiscal 2025 Q4, with revenue declining year-over-year but earnings per share (EPS) and net income showing growth. The company maintained profitability for the 12th consecutive quarter, aligning with management’s emphasis on operational stability. While the earnings beat expectations on the top line, the strategic focus on long-term value creation and ETF expansion remains central to its forward-looking guidance.

Revenue

The total revenue of Hennessy Advisors decreased by 3.2% to $8.50 million in 2025 Q4, down from $8.78 million in 2024 Q4. The decline reflects challenges in asset management, though the company’s annual GAAP revenue for fiscal 2025 rose 19.9% to $35.54 million, driven by higher average daily net assets.

Earnings/Net Income

Hennessy Advisors's EPS rose 3.9% to $0.31 in 2025 Q4 from $0.30 in 2024 Q4, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $2.42 million in 2025 Q4, marking 4.0% growth from $2.33 million in 2024 Q4. The Company has sustained profitability for 12 years over the corresponding fiscal quarter, reflecting stable business performance. Earnings per share and net income both showed modest growth, reflecting improved operational efficiency and sustained profitability.

Post-Earnings Price Action Review

The strategy of buying Hennessy Advisors (HNNA) shares after a revenue drop quarter-over-quarter on the financial report release date and holding for 30 days delivered moderate returns but underperformed the market. The strategy's CAGR was 3.27%, trailing the benchmark by 60.49%. With a maximum drawdown of 0.00% and a Sharpe ratio of 0.08, the strategy had low risk but offered conservative returns, making it suitable for investors seeking stability in a volatile market.

CEO Commentary

Neil Hennessy, Chairman and CEO of Hennessy Advisors, highlighted a 38% annual increase in earnings per share (EPS) to $1.27, driven by a resilient economy and strong market performance (Dow +11.5%, S&P 500 +17.6% total return). He emphasized steady consumer spending, solid corporate earnings, and moderate inflation as favorable fundamentals, expressing confidence in the U.S. economy and market resilience. All 17 Hennessy Funds posted positive one- and three-year returns, with 16 funds delivering gains over five- and ten-year periods. Despite a 9% decline in year-end assets under management ($4.2 billion), leadership noted a strong balance sheet ($72 million cash) and a pending ETF expansion deal. The tone was optimistic, with a focus on growth, stability, and disciplined operations.

Guidance

Hennessy expects lower interest rates from the Federal Reserve to support investors, consumers, and businesses in coming months. The company reaffirmed its commitment to maintaining quarterly dividends and pursuing growth opportunities organically and through acquisitions. Teresa Nilsen, President and COO, noted a focus on “long-term value for shareholders” and highlighted a pending ETF deal to expand product offerings. No specific financial targets were provided, but the firm emphasized leveraging its operating model and cash position ($32.2 million year-end) to drive future growth. Forward-looking statements align with market fundamentals and strategic stability.

Additional News

Hennessy Advisors announced a definitive agreement to acquire two ETFs from STF Management, LP, expanding its ETF portfolio with the STF Tactical Growth ETF and STF Tactical Growth & Income ETF, pending regulatory approvals. The company also declared a quarterly dividend of $0.1375 per share, maintaining its 19-year streak of consistent payouts. Additionally, the Hennessy Stance ESG ETF transitioned to a fully transparent structure, enhancing investor visibility while retaining its sustainability-driven strategy. These moves underscore the firm’s focus on product diversification and long-term shareholder value.