Wellgistics Health, Inc. reported its third‑quarter 2025 financial results, showing a net operating loss of $33.878 million for the nine‑month period ended September 30, 2025, a sharp increase from the $1.867 million loss recorded in the same quarter of 2024. The loss expansion is largely driven by a $27.5 million spike in stock‑based compensation related to a pre‑IPO acquisition, which was not a recurring expense in prior periods.
Revenue for the quarter fell to $3.01 million, a 91% decline from the $34.13 million earned in Q3 2024. The revenue drop reflects a severe contraction in the company’s core wholesale distribution business, where cash constraints limited inventory purchases and delayed shipments. The company’s first‑half revenue of $18.65 million, previously reported, was a separate metric and does not represent the nine‑month total.
Management highlighted the ongoing “going concern” warning issued earlier in the year, underscoring doubts about the company’s ability to continue operating without additional capital. In response, Prashant Patel, President and Interim‑CEO, announced two debt‑to‑equity conversion agreements that converted $5.319 million of debt into common stock, aiming to strengthen the balance sheet and reduce leverage.
The company’s gross margin contracted to 8.08% from 8.50% in the prior year, reflecting pricing pressure and higher cost of goods sold amid reduced sales volume. Segment analysis shows that distribution services revenue dropped 47% due to cash shortages, while pharmacy retail sales remained flat, indicating that operational challenges are concentrated in the wholesale arm.
Looking ahead, Wellgistics Health has not provided new guidance for the remainder of 2025. The management’s focus remains on stabilizing cash flow, completing the debt conversions, and pursuing strategic initiatives such as the launch of Brenzavvy for type 2 diabetes and the EinsteinRx AI pharmacy hub. Investors and analysts are closely monitoring the company’s liquidity position and the impact of the stock‑based compensation expense on future earnings.
The market reacted with a 3.45% decline in pre‑market trading, driven by the widened loss and the dilution from the increased share count. Analysts noted that the company’s high debt‑to‑equity ratio and Altman Z‑Score of –3.14 place it in a distress zone, raising concerns about long‑term viability.
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