Investment Thesis
Spectral AI exhibits severe fundamental deterioration with negative stockholders' equity of -$5.7M, indicating liabilities exceed all assets. The company is burning cash at an unsustainable rate with -$9.9M operating cash flow while revenue declined 33.6% YoY, and despite improved net loss per share, absolute profitability metrics remain deeply negative across all measures.
Strengths
- Solid gross margin of 45.4% indicates viable unit economics at production level
- Substantial cash position of $15.4M provides runway for operations
- Net loss improved 50.1% YoY suggesting some operational adjustments or cost controls
Risks
- Negative stockholders' equity of -$5.7M represents technical insolvency and solvency crisis
- Operating cash burn of -$9.9M annually with only $15.4M cash implies runway of less than 18 months at current burn rate
- Revenue collapse of 33.6% YoY combined with -43.8% operating margin indicates business model failure at scale
- Current ratio of 0.94x below 1.0 signals immediate liquidity concerns and inability to cover short-term obligations
- Interest coverage ratio of -8.6x shows inability to service debt from operations
Key Metrics to Watch
- Quarterly revenue trend and customer retention rates
- Monthly cash burn rate and path to cash flow breakeven
- Gross margin sustainability as company scales or restructures
- Total liabilities trajectory and refinancing needs
- Operating leverage improvements and cost structure reduction
Financial Metrics
Revenue
19.7M
Net Income
-7.6M
EPS (Diluted)
$-0.29
Free Cash Flow
-9.9M
Total Assets
21.4M
Cash
15.4M
Profitability Ratios
Gross Margin
45.4%
Operating Margin
-43.8%
Net Margin
-38.5%
ROE
N/A
ROA
-35.4%
FCF Margin
-50.5%
Balance Sheet & Liquidity
Current Ratio
0.94x
Quick Ratio
0.90x
Debt/Equity
N/A
Debt/Assets
126.8%
Interest Coverage
-8.60x
Long-term Debt
9.3M
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-04-01T16:32:11.261065 |
Data as of: 2025-12-31 |
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