Capstone Holding (CAPS) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue increased 11% year-over-year to $13.7 million, driven by the Carolina Stone Holdings acquisition.

• Net loss for Q3 2025 was $2.0 million, compared to a net loss of $34,000 in Q3 2024, due to higher SG&A, transaction expenses, and a loss on extinguishment of debt.

• For the nine months ended September 30, 2025, revenue was $34.4 million, nearly flat year-over-year, with a net loss of $4.4 million versus a $1.5 million loss in the prior year.

• Achieved record Q3 results with 19% year-over-year pro forma revenue growth to $41.2 million, driven by acquisitions and organic expansion.

• Pro forma adjusted EBITDA increased 46% and gross profit rose 34% year-over-year, reflecting strong operational execution and cost discipline.

Financial highlights

• Q3 2025 gross profit was $3.3 million, up 9% year-over-year; gross margin slightly decreased to 23.8%.

• SG&A expenses rose 31% in Q3 2025, mainly due to increased investor relations and acquisition-related costs.

• Pro forma year-to-date revenue reached $41.2 million, up 19% year-over-year.

• Pro forma adjusted EBITDA grew 46% year-over-year.

• Gross profit increased 34% year-over-year, supported by acquisition growth and cost controls.

Outlook and guidance

• Management expects sufficient liquidity for at least one year, supported by the Revolver, equity line, and recent convertible note financings.

• The company plans to pursue both organic and acquisition-driven growth, leveraging recent capital raises.

• On track to close a major acquisition before December 15, expected to be immediately accretive to revenue and EBITDA.

• Targeting a $100 million revenue run-rate by early 2026, supported by organic growth and M&A.

• Expects to complete three to four strategic acquisitions in 2026, with a robust pipeline under review.