Nexalin Technology 2025 Q2 Earnings Narrowed Losses Despite Strong Revenue Growth

Nexalin Technology reported its fiscal 2025 Q2 earnings on Aug 6, 2025. Revenue surged 163.0% year-over-year to $70,588, outpacing expectations, while the company narrowed its per-share loss. However, net losses expanded in dollar terms, highlighting ongoing financial challenges. The CEO outlined a strategic shift toward AI-driven logistics and cost optimization, aiming for profitability by year-end.

Revenue
Revenue for Nexalin Technology’s Q2 2025 surged by 163.0% year-over-year to $70,588, driven by robust performance across multiple segments. The equipment division accounted for the largest share, contributing $52,526, while the licensing fee segment added $10,355. Additional revenue streams, including other services, generated $7,707, rounding out the total. This marked a significant turnaround compared to the $26,840 reported in the same period of the prior year, underscoring strong top-line momentum.

Earnings/Net Income
Earnings per share (EPS) improved, with losses narrowing to $0.10 per share in Q2 2025 from $0.17 in the prior-year period, a 41.2% reduction. However, the company’s net loss widened to $1.58 million from $1.28 million in 2024 Q2, representing a 23.1% increase in total losses. Nexalin has reported losses for the fifth consecutive year in the same quarter, signaling continued financial strain despite improved EPS metrics.

Price Action
The stock of Nexalin Technology recorded mixed performance in the short term. It fell 3.88% during the most recent trading day and declined further by 3.88% over the past full trading week. However, the stock showed a positive trend month-to-date, rising 4.21%.

Post-Earnings Price Action Review
The post-earnings trading strategy of buying NXL following a revenue beat and holding for 30 days performed poorly, returning -56.80%, significantly underperforming the benchmark by 118.40%. The strategy exhibited a maximum drawdown of 0.00% and a Sharpe ratio of -0.16, reflecting its high risk and low returns.

CEO Commentary
CEO David K. Monroe emphasized Nexalin’s strategic transition, with a focus on R&D investments in AI-driven logistics solutions as a key growth driver. He acknowledged near-term challenges, including rising component costs and supply chain delays, but expressed confidence in the long-term potential of the company’s smart infrastructure offerings. Monroe also highlighted efforts to expand market share in the Asia-Pacific region and improve operational efficiency through automation, adopting a cautiously optimistic tone.

Guidance
The company provided revenue guidance of 12–14% growth for the remainder of 2025, with a focus on improving gross margins through cost optimization and scale. While no specific EPS target was outlined, the CEO expressed a path toward profitability by Q4 2025, contingent on successful execution of R&D and go-to-market strategies. Capital expenditures are expected to rise by 8–10% this year to support new product launches and regional expansion.

Additional News
On August 2, 2025, Nexalin Technology filed an 8-K with the SEC titled "Event for Officers," dated August 1, 2025. The filing includes a Financial Exhibit and details about management structures, executive compensation, and voting procedures from the company’s Annual Proxy Statement. The Proxy Statement outlines salaries, bonuses, and perks for board members and the executive team. Nexalin also provided additional materials in Exhibit 99.1, with the filing accepted by the SEC on August 4, 2025. The report does not include earnings metrics but highlights ongoing corporate governance and executive structure updates, offering insight into the company’s internal operations and strategic direction.