Executive Summary

Earth Science Tech delivered strong top-line growth in the quarter ended December 31, 2023 (company fiscal Q3 2024), with revenue of $3.79M and gross margin of 62.7%, while net income was $0.23M, reflecting scale benefits from RxCompound and Peaks acquisitions .
Versus prior quarter (September 30, 2023), revenue doubled (+97.0%), but net income declined as operating expenses (notably account management fees) ramped to support growth; gross margin held >60% .
Management highlighted December 2023 as the highest revenue and profit month to date and subsequently authorized a $5M share repurchase program (expires December 31, 2025), signaling confidence and capital return optionality .
Wall Street consensus EPS and revenue estimates were unavailable via S&P Global at time of retrieval; comparison to estimates is therefore not provided (see Estimates Context) [GetEstimates error – S&P Global daily limit exceeded].

What Went Well and What Went Wrong

What Went Well

Revenue surged to $3,790,112 with gross profit of $2,376,698 (62.7% margin), driven primarily by RxCompound and Peaks integration and demand growth .
December 2023 marked the highest revenue and profit month, reflecting momentum in sterile injectables and expanded offerings; management expects continued account growth and state licensing expansion .
Balance sheet improved vs prior year with equity turning positive and liabilities reduced through settlements and SBA note satisfaction in January–February 2024 .

Management quote:

“The Company recorded its highest revenue and profit generated month in December 2023.”
“We continue to execute… decreased debt… increased revenue and positive cash flows.” (Q2 press release) .

What Went Wrong

Operating expenses rose materially to $2,145,667, with general and administrative expenses (including ~$1.27M account management fees) driving compression in operating leverage vs the prior quarter .
Interest expense, while reduced vs prior year trend, remained a drag in the quarter ($13,838), and disclosure controls were deemed “not effective” at quarter end, highlighting governance/process risks .
EPS was not disclosed in filings; lack of earnings call or item 2.02 8‑K limits external visibility and analyst engagement for microcap investors [ListDocuments results: none for 8-K 2.02 or earnings-call-transcript].

Financial Results

Metric	Q4 2022 (Dec 31, 2022)	Q3 2023 (Sep 30, 2023)	Q4 2023 (Dec 31, 2023)
Revenue ($USD)	$2,533	$1,927,720	$3,790,112
Gross Profit ($USD)	$1,708	$1,181,494	$2,376,698
Gross Margin (%)	67.4%	61.3%	62.7%
Total Operating Expenses ($USD)	$49,983	$701,550	$2,145,667
Operating Income ($USD)	$(48,275)	$479,944	$231,031
Interest Expense ($USD)	$4,483	$34,911	$13,838
Net Income ($USD)	$98,464	$444,581	$225,443
EPS ($USD)	N/A (not disclosed)	N/A (not disclosed)	N/A (not disclosed)

Notes:

EPS was not presented in ETST’s quarterly statements of operations for these periods .

Balance sheet and liquidity KPIs (quarter-end comparison)

KPI	Sep 30, 2023	Dec 31, 2023
Cash and Cash Equivalents ($USD)	$187,649	$205,718
Accounts Receivable ($USD)	$62,861	$112,826
Inventory ($USD)	$211,240	$395,483
Accounts Payable ($USD)	$343,556	$515,337 (incl. inventory under net 60)
Current Liabilities ($USD)	$508,850	$825,166
Total Liabilities ($USD)	$1,107,704	$1,086,272
Stockholders’ Equity ($USD)	$1,933,640	$2,159,383

Other relevant press release (capital return)

$5M share repurchase authorization (through Dec 31, 2025) .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q4 2023 and beyond	Not provided	Not provided	Maintained (no numeric guidance)
Gross Margin	Q4 2023 and beyond	Not provided	Not provided	Maintained (no numeric guidance)
OpEx	Q4 2023	Not provided	Scaling with account growth; notable account management fees in G&A	Qualitative update (no numeric range)
Capital Allocation (Share Repurchase)	2024–2025	None	Authorized up to $5.0M through Dec 31, 2025	New/raised

Earnings Call Themes & Trends

No Q4 2023 earnings call transcript or 8-K 2.02 was found; themes below reflect MD&A and press releases.

Topic	Previous Mentions (Q1 2023 – quarter ended Jun 30, 2023)	Previous Mentions (Q2 2023 – quarter ended Sep 30, 2023)	Current Period (Q4 2023 – quarter ended Dec 31, 2023)	Trend
RxCompound sterile injectables and licensing expansion	Sterile lab approval; licensing expansion underway	Continued licensing and digital infra build; consultants hired	Highest month in Dec; plan to expand approved states and accounts	Strengthening
Telemedicine platforms (Peaks, MOC, domains)	Launch of MOC and e-commerce properties (ViagraMia, MySexGummy)	Ongoing build-out, portfolio diversification	Platforms cited as part of growth plan; no numeric guidance	Building
Debt reduction and settlements	Conversions and settlements reduced obligations	Strongbow amended terms; liabilities down; equity positive	SBA loans fully satisfied after quarter (Jan/Feb 2024)	Improving
Gross margin/COGS dynamics	67.6% margin in Q1 2023	61.3% margin in Q2 2023	62.7% margin in Q4 2023	Stable >60%
Governance/controls	Controls effective (Q1 2023)	Controls effective (Q2 2023)	Controls not effective (Q4 2023)	Deteriorated
Capital return	None	Considering buybacks/dividends (exploration)	$5M repurchase authorized	Positive shift

Management Commentary

“The Company recorded its highest revenue and profit generated month in December 2023… expand approved states… obtain more accounts… expand intellectual properties with unique platforms… further increase assets and revenue.” (MD&A) .
“We continue to execute. The company has decreased its debt significantly… increased revenue and positive cash flows.” (CEO, Q2 press release) .
“We have come a long way… reduced liabilities significantly, while also increasing cash position… committed to continuing the execution of our growth strategy.” (CEO, Q1 press release) .
“This [repurchase] program is a reflection of our current position as a company and commitment to creating shareholder value.” (CEO on buyback) .

Q&A Highlights

No Q4 2023 earnings call transcript was available; no Q&A session or analyst clarifications can be cited for this period [ListDocuments results: none for earnings-call-transcript].

Estimates Context

Wall Street consensus EPS and revenue estimates for Q4 2023 (fiscal Q3 2024) were unavailable via S&P Global at time of retrieval due to access limit; therefore no beat/miss analysis vs consensus is provided. Values would be retrieved from S&P Global if accessible.

Key Takeaways for Investors

Strong sequential and year-over-year revenue growth to $3.79M with gross margins >60% underscores scaling in compounding and telemedicine; December was a record month .
Operating expense growth (notably account management fees) tempered operating income; watch for OpEx efficiency as revenues scale to sustain margin leverage .
Balance sheet and liabilities improved, with SBA loans fully satisfied post-quarter; continued debt reduction enhances financial flexibility .
Governance/process risk emerged with disclosure controls deemed not effective at quarter end; remediation progress should be monitored closely .
$5M buyback authorization signals management’s confidence and potential support for share price/liquidity through 2025; execution cadence will matter for investor returns .
Absence of an earnings call and formal item 2.02 press release reduces external visibility; increased investor communications could broaden coverage and tighten estimate dispersion [ListDocuments results: none for 8-K 2.02 or earnings-call-transcript].
With platforms and state licensing expansion underway, near-term trading could react to additional operational milestones and any updates on segment mix or margin trajectory; medium-term thesis hinges on sustained growth, OpEx normalization, and control enhancements .

Sources: Q3 2024 10‑Q (quarter ended Dec 31, 2023) ; Q2 2024 10‑Q (quarter ended Sep 30, 2023) ; Q1 2024 10‑Q (quarter ended Jun 30, 2023) ; Q2 press release 8‑K ; Q1 press release 8‑K ; Share repurchase 8‑K .

Earth Science Tech, Inc. (ETST)·Q4 2023 Earnings Summary