Deepexi Technology (SEHK:1384) EPS Loss Narrows In 1H 2025 Testing Bearish Narratives

Deepexi Technology (SEHK:1384) has reported fresh numbers for FY 2025, with first half revenue of C¥132.1 million and a basic EPS loss of C¥1.12, while the trailing twelve months show revenue of C¥314.5 million and a basic EPS loss of C¥3.92. The company’s revenue moved from C¥129.0 million in 2H 2023 to C¥242.9 million in 2H 2024 and then to C¥132.1 million in 1H 2025. Net income excluding extra items shifted from a loss of C¥502.9 million in 2H 2023 to a loss of C¥1.25 billion in 2H 2024 and a loss of C¥308.2 million in 1H 2025. Investors are likely to focus on how management approaches margins and the conversion of headline growth into more efficient loss control.

See our full analysis for Deepexi Technology.

With the latest figures in place, the next step is to see how this earnings profile aligns with the most common narratives around Deepexi Technology, and where the numbers start to challenge those stories.

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69.4% revenue growth set against ongoing losses

• Over the trailing twelve months, Deepexi generated C¥314.5 million in revenue and recorded a net income loss excluding extra items of C¥942.2 million, so the 69.4% revenue growth still sits alongside a sizeable loss.
• What stands out for the bullish view is that strong top line growth of 69.4% and forecasts of around 67.2% revenue growth and 112.09% earnings growth per year sit next to a C¥942.2 million loss, which means:
  • The growth numbers support the bullish idea that the business is scaling, but current earnings remain firmly negative over the last twelve months.
  • Bulls who focus on potential future profitability need to be very aware that recent reported losses are still large compared to current revenue.

EPS loss narrows in 1H 2025

• Basic EPS moved from a loss of C¥3.02 in 1H 2024 and C¥3.08 in 2H 2024 to a loss of C¥1.12 in 1H 2025, while net income excluding extra items shifted from losses of C¥620.9 million and C¥634.0 million in 1H and 2H 2024 to a loss of C¥308.2 million in 1H 2025.
• Critics focused on the bearish angle point to the run of losses, yet this sequence of EPS and net income figures raises a question for that view because:
  • Losses in 1H 2025 are smaller in absolute terms than in both halves of 2024, which shows a different pattern to the earlier periods of heavier losses.
  • The trailing twelve month EPS loss of C¥3.92 reflects these big negative halves, so anyone leaning on a bearish story needs to separate the most recent half from the broader loss history.

High 33.2x P/S and balance sheet risk

• The shares trade on a P/S of 33.2x, compared with 14.3x for peers and 2x for the Hong Kong Software industry, while the company also has negative shareholders’ equity and a share price of C¥36.40.
• Bears argue that a rich P/S multiple and negative equity leave little room for error, and the current figures highlight why that concern is grounded in hard numbers because:
  • Paying 33.2x sales when the trailing twelve month net income is a loss of C¥942.2 million means the valuation is being supported by expectations rather than current profitability.
  • Negative shareholders’ equity and recent share price volatility add another layer of risk if revenue growth or the expected move to profitability within three years does not materialise as forecast.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Deepexi Technology's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

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See What Else Is Out There

Deepexi Technology couples sizeable losses, negative shareholders’ equity and a high 33.2x P/S multiple with ongoing balance sheet risk that may concern more cautious investors.

If those balance sheet pressures feel uncomfortable, you can quickly compare this profile with companies screened for stronger fundamentals and lower financial strain using the solid balance sheet and fundamentals stocks screener (382 results).

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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