Gorilla Technology Group Inc. (NASDAQ:
GRRR
) Q1 2025 Earnings Call Transcript June 18, 2025
Gorilla Technology Group Inc. beats earnings expectations. Reported EPS is $0.23, expectations were $0.01.
Operator:
Thank you for standing by. This is the conference operator. Welcome to the Gorilla Technology Group, Inc. Earnings Call for the First Quarter of 2025. [Operator Instructions]. Before we begin, we will read the forward-looking statement. Today’s call includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect management’s current expectations and projections about future events and are subject to known and unknown risks and certainties that could cause actual results to differ materially. Forward-looking statements often include terms such as expects, believes, plans, anticipates, may, should, and similar expressions.
For a discussion of important factors that could affect Gorilla’s results, please refer to our filings with the SEC, including our most recent annual report on Form 20-F. Except as required by law, Gorilla undertakes no obligation to update or revise any forward-looking statements made on this call, whether as a result of new information, future events or otherwise. I would now like to turn the conference over to Jay Chandan, Chairman and Chief Executive Officer, and Bruce Bower, Chief Financial Officer. Please go ahead.
Jayesh Chandan:
Thank you very much, Nick. Well, for everyone who’s here today, first of all, welcome to our conference call. I’m delighted you all could join. This has been one of the operationally significant quarters in Gorilla’s history. We are expanding across the United States, Latin America, Southeast Asia and East Asia, converting real pipeline into delivery and deepening partnerships with some of the world’s most respected institutions. Gorilla is scaling fast and executing harder. The quarter reflects exactly what we have been building towards, a strong financial performance, global expansion and material progress across smart infrastructure, AI security and national digital systems. What you all are seeing right now is not an early-stage growth.
It’s a strategic expansion. We’re securing projects in ports, airports, data centers, hospitals, education, law enforcement and all of this is now moving from negotiation to execution. Over the last 2 years, we have made deliberate decision to focus inward, fixing the fundamentals, which is very key for our business, restructuring globally, scaling our delivery capability, hiring the right people and proving above all that we can execute. We are not just a hype-driven company. Whilst others were chasing headlines and inflated projections, we were securing national infrastructure contracts deploying mission-critical systems in the public sector and more importantly, getting our financial house in order. That meant, tightening our operations, rebuilding the teams, pushing through complexity in multiple markets quietly, consistently and without the need for a drumroll.
Now with our revenue up more than 100% year-on-year and with a positive net income and more importantly, with a $5 billion-plus pipeline and real deals being delivered across Southeast Asia, Middle East, North Africa, Latin America and beyond, the results are loud enough or I believe the results are loud enough on their own. We’re seeing immense acceleration from Q2, Q3, Q4 going into 2026. And I couldn’t be more excited to join you all on this call and let you know that we are positioned for a very strong ’26 as well. Bruce, do you want to take them through the numbers on a very high level?
Bruce Gregory Bower:
Yes, so I would like to mention a few of the highlights that I’m sure you’ve seen from the release. So the first is, of course, the revenue of $18.3 million, 109% year-on-year growth. But not only that, we’re quite happy with the adjusted EBITDA of $5.16 million, which represents a 48% increase year-on-year. And then the adjusted net income of $4.47 million, which is a 46.7% increase. In total, this means that we’re executing well on the contracts, the business that we have, and it’s flowing through into profitability. The other thing I’d like to point out is that the balance sheet remains strong. So the first thing is total cash reserves both restricted and unrestricted closed the quarter at $33.8 million.
In addition, we did that while managing to reduce debt. So the debt has dropped from over $20 million at the end of the year to $18.4 million. Subsequent to the close of the quarter, we actually have reduced the debt further to $17 million as of today. We’ve done that in a cash-neutral fashion, where basically, we have blocked deposits, that are collateralizing the loan. So pay off a $1 of debt, that releases $1 of blocked deposit. So we’re very proud of the way that we have managed the balance sheet in this time. A couple of other things I’d like to point out is, first of all, the cap table. So we ended the first quarter with around 20.15 million — with less than 20 million shares outstanding, slightly less than 20 million, and now it’s a hair over 20 million shares outstanding at 20.15 million.
And then the fully diluted share count remains the same because that increase in outstanding shares came due to the exercise of warrants. The other thing I’d like to point out is that during the quarter, the second quarter. So subsequent to this sort of the earnings release, we spent $1.8 million on share buybacks. So that means that we’ve spent a total of $5.4 million on the buyback program in the last 12 months. In addition to that, we have a total $10 million program authorized, so that gives us $4.6 million of remaining capacity. We’ve done all this with the business — with the balance sheet, while also investing for the future. So Jay, of course, mentioned some of the pipeline and some of the partnerships that we have. I would like to highlight, first of all, the ONE AMAZON partnership, where in the first quarter, we made a $1.5 million investment.
We followed with $3.5 million in the second quarter. So a total commitment of $5 million to secure that long-term partnership. I’m sure Jay can mention more about what’s going on in general with that, but we’re very happy to have — to be participating in this partnership in a financial way. At the moment, you can see that, that investment is carried at cost on the balance sheet for the quarter. One other thing I’d like to point out is the guidance. So the guidance has remained for 2025, the same where it’s $100 million to $110 million is the revenue guidance. This is based on a backlog, which is revenue that we have secured in the sense of where we have contracts signed and is either due to be implemented or it’s being implemented already.
There’s a date attached to the revenue. And we expect an EBITDA of $20 million to $25 million based on that revenue number and then a net profit in the range of $15 million to $20 million. Of course, that excludes extraordinary items. So that guidance remains the same. And then 2026, we are not in a position to issue guidance for the full year, but we can say that the backlog continues to shape up. So it’s at $70 million for 2026, and then also, we have several projects that we have talked about, where it’s in the proof-of-concept stage and advancing. So we are confident that, that backlog will grow. And then the last thing, as Jay mentioned, that we have over $5 billion in pipeline and qualified leads. The sharp observers will look at that, has actually decreased from earlier in the year, where it was over $6 billion.
The reason for that is actually because our MOU with the PEA, the Provincial Electricity Authority in Thailand has moved into proof-of-concept stage. So it’s no longer a qualified lead, it’s in the proof-of-concept stage. So that’s the reason for the drop. Outside of that, actually, the qualified leads, the amount of sort of contracts — potential contract value attached to them, grew. And then one other thing, not quantitative, but I’d like to talk about the funding. So as you can tell, we have a strong balance sheet, fortress-like in terms of cash balance, both restricted and unrestricted cash and also the debt that continues to reduce. The funding that we have on the balance sheet now is enough to tackle the projects that we have signed already, and it’s enough to tackle what we envision as the projects that we we’ll be signing shortly.
If we were to sign more projects that need funding, then we would first look for project level funding. Second would be debt or debt- like instruments and only then maybe would we look for equity. But I’d just like to emphasize that we’re very confident in the balance sheet that we have and our ability to take on new projects without — first of all, hopefully, without having to raise outside funding. And if we do have to raise outside funding, Jay and I remain committed to protecting shareholders. That — those are the main points for me. Back to you, Jay, or over to the moderator.
Jayesh Chandan:
Nick, I’m happy to take questions so that we can respond — get some more time and respond more diligently to all the questions, both the analysts and the shareholders may have.
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