Executive Summary

Q3 2025 revenue was $4.04M, down 42.4% year-over-year vs. $7.01M in Q3 2024, while net loss narrowed slightly to $3.49M and EPS improved to ($0.20) from ($0.30) YoY, reflecting continued cost discipline .
Operating expenses fell 24% YoY to $3.8M and operating loss improved 9% YoY to ($2.77M), as management emphasized structural efficiency gains and a leaner operating model .
Guidance narrative: management reiterated the profitability timeline for Q1 2026, consistent with Q2 messaging; this marks a push-out from the Q1 2025 goal of “profitability and positive cash flow by the end of 2025” stated in May, now aligned to Q1 2026 .
Capital position improved via a $3.9M PIPE financing to support the turnaround; management highlighted sales momentum with “double‑digit new clients contracted for January 1,” framing 2026 as an earnings leverage inflection .

What Went Well and What Went Wrong

What Went Well

Operating expenses down 24% YoY to $3.8M; operating loss narrowed 9% YoY to ($2.77M). CEO: “We’re operating leaner, smarter, and closer than ever to sustained profitability” .
Sales pipeline and client adds: “over double‑digit new clients contracted for January 1,” with integrated MarpaiRx PBM gaining traction; management expects revenue growth to translate to earnings leverage .
Liquidity reinforcement: completed a $3.9M PIPE to “provide sufficient cash flow to diligently execute its turnaround strategy,” with long‑term shareholders participating .

What Went Wrong

Top-line contraction: Q3 2025 revenue fell 42.4% YoY to $4.04M vs. $7.01M in Q3 2024; sequential decline from Q2 2025’s $4.66M underscores ongoing revenue pressure during transformation .
Continued losses: net loss remained sizable at ($3.49M); net margin was approximately (86.6%), reflecting interest expense of ($0.80M) and negative EBITDA .
Balance sheet strain: stockholders’ deficit widened to ($33.35M); total liabilities increased to $46.10M, including convertible debentures (current and long-term) totaling ~$9.84M .

Financial Results

Quarterly P&L comparison (oldest → newest)

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD)	$5.418M	$4.656M	$4.037M
Cost of Revenue ($USD)	$3.484M	$3.910M	$2.963M
Gross Profit ($USD)	$1.934M (calc)	$0.746M (calc)	$1.074M (calc)
Gross Margin %	35.7% (calc)	16.0% (calc)	26.6% (calc)
Operating Loss ($USD)	($2.250M)	($3.607M)	($2.771M)
Operating Margin %	(41.5%) (calc)	(77.5%) (calc)	(68.6%) (calc)
Net Loss ($USD)	($3.069M)	($4.371M)	($3.494M)
Net Margin %	(56.6%) (calc)	(93.9%) (calc)	(86.6%) (calc)
EPS (Basic & Diluted)	($0.21)	($0.28)	($0.20)
Weighted Avg Shares	14,770,867	15,503,132	17,299,687

Year-over-Year snapshot (Q3 2025 vs. Q3 2024)

Metric	Q3 2024	Q3 2025
Revenue ($USD)	$7.008M	$4.037M
Operating Loss ($USD)	($3.060M)	($2.771M)
Net Loss ($USD)	($3.560M)	($3.494M)
EPS (Basic & Diluted)	($0.30)	($0.20)
Operating Expenses ($USD)	$5.0M	$3.8M

Estimates vs. Actuals (Q3 2025)

Note: Wall Street consensus via S&P Global appears unavailable for EPS and revenue; EBITDA field contains “actual” only.

Metric	Consensus (Q3 2025)	Actual (Q3 2025)
Primary EPS Consensus Mean	N/A*	($0.20)
Revenue Consensus Mean	N/A*	$4.037M
EBITDA Consensus Mean	N/A*	($2.582M)*

Values retrieved from S&P Global.
The EBITDA “actual” above is from S&P Global output and marked with an asterisk; consensus counts (# of estimates) were unavailable.*

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Profitability timing	Company-level	“Profitability and positive cash flow by end of 2025” (May 2025)	“On track to achieve profitability in Q1 2026” (Aug & Nov 2025)	Lowered (timing pushed out)
Sales momentum / client adds	Jan 1 cycle	Not quantified (Q1 commentary emphasized pipeline)	“Over double‑digit new clients contracted for January 1”	Raised (qualitative strength)
Infrastructure investment	Q3 2025	“Expect to make a major infrastructure investment in Q3”	Not updated/quantified in Q3 PR	Maintained narrative; no numeric update
Revenue/Margins/OpEx numeric guidance	Q3–FY 2025/2026	None provided	None provided	Maintained (no formal numeric guidance)

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Current Period (Q3 2025)	Trend
Cost discipline / efficiency	“Operating expenses down 33% YoY; relentless efficiencies”	OpEx down 24% YoY; operating loss improved 9% YoY	Improving; sustained execution
Sales pipeline / client adds	Strong H2 2025 pipeline; off‑cycle wins discussed in Q&A	“Over double‑digit new clients contracted for Jan 1”	Strengthening pipeline into 2026
MarpaiRx PBM	“Relaunch… game changing” noted; Dallas Scrip to lead PBM	PBM gaining traction and expanding TAM	Expanding role; differentiator
Empara portal / technology	Empara Member Portal rollout on track for Q2 2025	Continued automation and data-driven claims focus	From portal deployment to broader automation
Capital / liquidity	Convertible debentures funding in Q1; cash burn concerns addressed	$3.9M PIPE completed to support turnaround	Strengthened near-term liquidity
Profitability timing	“Cash flow positive and profitability by end of 2025”	Reiterated Q1 2026 profitability target	Timing pushed out; clarity improved

Management Commentary

CEO: “We’re operating leaner, smarter, and closer than ever to sustained profitability.”
CEO: “We’ve built a durable operating model designed to convert every point of future revenue growth directly into earnings leverage.”
Q1 call: “As Marpai’s largest shareholder, hitting profitability this year is my absolute top priority… We strengthened our leadership team… Dallas Scrip as COO and President of MarpaiRx.”
Strategy: “Ongoing initiatives in automation, data-driven claims management, and integrated pharmacy benefits” position the company for scalable economics .

Q&A Highlights

Note: Q3 2025 earnings call transcript not available in the document system; highlights below reference Q1 2025 as context.
Off-cycle client wins and January cycle strategy: focus on margin-generating clients; expect stronger Jan cycle next year .
Cash burn reduction: vendor rationalization, legacy contracts ending, operational efficiencies to reduce cost and improve service; significant reduction expected in Q2 .
Empara portal: AI-driven benefits Q&A, reduced call center load, integrated handoff to agents; efficiency and service improvements .

Estimates Context

S&P Global consensus for Q3 2025 EPS and revenue appears unavailable; no counts of estimates were returned, precluding beat/miss determination.*
EBITDA field returned actual (negative) without consensus; investors should focus on operating loss trajectory, OpEx trend, and pipeline conversion until estimate coverage normalizes.*
Values retrieved from S&P Global.

Key Takeaways for Investors

Bold cost execution: OpEx down 24% YoY to $3.8M; operating loss narrowed to ($2.77M); EPS improved to ($0.20) — key proof-points of turnaround discipline .
Revenue remains pressured (Q3 $4.04M vs. $4.66M in Q2 and $7.01M in Q3’24), but “double-digit” new clients for Jan 1 and PBM traction set up a potential 2026 earnings leverage turn .
Liquidity bolstered by a $3.9M PIPE; alongside rising WACS and liabilities, monitoring cash burn and debenture servicing remains essential for near-term risk management .
Profitability timeline clarified to Q1 2026 (reiterated from Aug/Nov) vs. earlier year-end 2025 target in May; expectation reset likely improves credibility of medium-term plan .
Technology advantage: automation and Empara/MarpaiRx integration can lower cost-to-serve and improve retention, potentially stabilizing gross margin back toward the 30%+ range if pipeline converts .
With limited Street estimate coverage, catalysts hinge on client onboarding (Jan cycle), PBM ramp, and sustained OpEx control; absence of explicit revenue/margin guidance elevates reliance on actuals and call disclosures .
Actionable: trade tactically on evidence of Jan 1 client adds and margin progression; medium-term thesis rests on PBM differentiation, automation-driven efficiencies, and delivering the Q1 2026 profitability milestone .

Marpai, Inc. (MRAI)·Q3 2025 Earnings Summary