MKDWELL Tech Inc. (Nasdaq: MKDW) reported unaudited financial results for the six months ended June 30 2025, showing total revenue of $1.37 million—an increase of 68.3% from $0.81 million in the same period a year earlier. Gross profit rose to $0.09 million, but the gross‑profit margin slipped from 8.2% to 6.5% as profitability on sales to major customers weakened. Net loss for the period narrowed to $1.70 million, a modest improvement from $1.73 million in the prior year’s first half, reflecting tighter cost control and a reduction in interest expense tied to a convertible promissory note issued in November 2024.
The revenue surge was driven by a 102.8% jump in sales of manufactured electronic products and a 128.9% increase in commissioned processing services. A key strategic customer entered mass production during the period, contributing significantly to the top‑line growth. Management noted that the new customer’s ramp‑up helped offset headwinds from lower margin sales to other large accounts.
Margin compression stemmed from lower profitability on sales to major customers, a result of pricing pressure and higher cost of serving those accounts. While the company achieved higher revenue volumes, the mix shift toward lower‑margin contracts and increased raw‑material costs eroded the gross‑profit margin. The company’s focus on securing new customers is intended to diversify its revenue base and improve margin quality over time.
The company’s convertible promissory note, issued in November 2024, carried a lower interest rate than its previous debt, contributing to the modest reduction in interest expense and the slight narrowing of the net loss. Working capital remained positive at $2.96 million, and accumulated deficits stood at $15.14 million as of June 30 2025. Management emphasized that the company will continue to pursue new customers to drive performance improvement and reduce reliance on a single large client.
"In the first half of 2025, as a key strategic customer entered mass production, we successfully secured a substantial increase in orders from it, which helped keep our losses stable year‑on‑year. We will continue to actively seek new customers to further drive performance improvement," said MKDWELL’s management.
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