Breaking Down Cosmos Holdings Inc. (COSM) Financial Health: Key Insights for Investors

You're looking at Cosmos Holdings Inc. (COSM) and seeing a classic growth-versus-liquidity puzzle, especially after their latest Q3 2025 report. Honestly, the headline numbers are defintely strong: the company hit a record quarterly revenue of $17.11 million, which is a massive 38% jump from the prior year, and gross profit more than doubled to $2.60 million. That 15.21% gross margin is the highest in their history, showing real operational efficiency in their nutraceuticals and contract manufacturing divisions. But here's the quick math on the risk: while they ended the quarter with a better cash position of $4.63 million, their liquidity remains tight, signaled by a current ratio of 0.99, and the GAAP net loss widened to $5.35 million, largely due to non-cash charges. So, the question isn't just about the $45.57 million in year-to-date revenue; it's about whether their strategic moves-like securing a $300 million digital financing facility and diversifying into digital assets like Ethereum-can outrun the underlying financial distress indicated by the Altman Z-Score of -2.16. We need to map out the real path to sustained profitability.

Revenue Analysis

You're looking for a clear picture of where Cosmos Holdings Inc. (COSM) is actually making its money, and honestly, the 2025 numbers show a company in the middle of a strategic pivot. The direct takeaway is this: while overall revenue growth is moderate, the quality of that revenue-the gross margin-is improving dramatically, which is defintely the right direction.

For the nine months ended September 30, 2025, Cosmos Holdings Inc. reported total revenue of $45.57 million, a solid 13% increase from the $40.20 million reported in the prior-year period. The trailing twelve months (TTM) revenue, ending Q3 2025, reached $59.79 million, showing a 6.69% year-over-year increase. This growth isn't explosive, but it's consistent, and it's driven by a shift to better-margin products.

Here's the quick math on the quarterly trends, which tells a more interesting story:

• Q1 2025 Revenue: $13.71 million (a -5.98% decline YoY).
• Q2 2025 Revenue: $14.75 million (an 11.66% increase YoY).
• Q3 2025 Revenue: $17.11 million (a massive 38% increase YoY).

The Q1 dip was a direct result of management cutting promotional-dependent, low-margin activities, a necessary clean-up. The Q3 surge, which hit a record $17.11 million, shows the new strategy is gaining traction. That's a huge jump in a single quarter.

Cosmos Holdings Inc. operates as a diversified, vertically integrated global healthcare group. Its revenue comes from four primary sources, though the wholesale segment still accounts for the highest volume.

The core business segments contributing to overall revenue are:

• Pharmaceutical Distribution (Wholesale Logistics).
• Proprietary Pharmaceutical and Nutraceutical Brands (like Sky Premium Life®).
• Manufacturing of Healthcare Products (Contract Manufacturing Organization or CMO).
• Telehealth Platform Operations.

The significant change in revenue streams is a strategic, conscious move toward higher-margin businesses. While the wholesale logistics segment still brings in the most top-line revenue, the focus is clearly on proprietary brands and manufacturing. For instance, in Q1 2025, the segment contribution to gross profit was split: $1.18 million from Wholesale logistics distribution versus $0.87 million from Owned nutraceuticals/pharmaceuticals and manufacturing. This focus on margin is why the Q3 2025 gross margin expanded to a record 15.21%, up from 9.72% a year earlier. This is the number you need to watch; it signals a healthier business model. You can get more detail on their long-term strategy here: Mission Statement, Vision, & Core Values of Cosmos Holdings Inc. (COSM).

The Q3 2025 record revenue was driven by strong performance across all core divisions, including the ramp-up of the contract manufacturing division at Cana Laboratories, robust growth in the CosmoFarm distribution business, and the global expansion of proprietary brands like Sky Premium Life. The company is actively shifting its sales mix, and the results are clear in the gross margin expansion. What this estimate hides, however, is the regional concentration; historically, the Greek market has accounted for the vast majority of revenue, so continued international expansion is key to de-risking the sales base.

Profitability Metrics

You need to know if Cosmos Holdings Inc. (COSM) is making money, and the short answer is: they are showing strong operational improvement but still reporting significant net losses. The third quarter of 2025 (Q3 2025) reveals a record-high gross margin, which is a great sign for core business efficiency, but the company is still deep in the red after covering operating and non-cash expenses. You're seeing a classic growth story trying to outrun high overhead.

A deep dive into the Q3 2025 income statement shows the immediate profitability picture. Gross profit, which is revenue minus the cost of goods sold, hit a record $2.60 million on $17.11 million in revenue. This translates to a Gross Margin of 15.21%, a huge jump from 9.72% in the year-ago quarter. That's a defintely positive signal that their product mix-especially the shift toward higher-margin nutraceuticals and contract manufacturing-is working. The company is getting more efficient at producing and sourcing its goods.

However, the operating and net results tell a different story. Operating expenses for the quarter totaled $4.42 million. Here's the quick math: when you subtract those expenses from the gross profit, you get an Operating Loss of approximately $1.82 million, resulting in a negative Operating Margin of about -10.64%. The bottom line is even tougher: Q3 2025 reported a Net Loss of $5.35 million. This gives Cosmos Holdings Inc. a Net Margin of roughly -31.27%. What this estimate hides is the significant impact of non-cash charges, like those related to derivatives and convertible notes, which are driving that net loss much wider than the operating loss.

Looking at the trends, the operational efficiency story is compelling. For the nine-month period ended September 30, 2025, the Gross Margin was 12.76%, up substantially from 8.23% in the prior-year period. This trend shows a sustained improvement in cost management and product mix over time, not just a one-off quarter. The company is actively focusing on its higher-margin proprietary brands like Sky Premium Life and contract manufacturing at Cana Laboratories, which is exactly why you see the Gross Margin expanding so rapidly. Still, the challenge remains in controlling the overall cost structure and mitigating the impact of non-operating financial instruments.

When you compare these figures to the industry, you see the tension. For the broader U.S. prescription drug supply chain-which includes distributors like a key part of Cosmos Holdings Inc.'s business-the average annual Net Income Margin is often around 2.3%. Cosmos Holdings Inc.'s negative -31.27% Net Margin is clearly far from that benchmark, but that's largely due to non-cash charges and its current growth phase. More relevantly, the 15.21% Gross Margin is competitive with the 15% to 25% range seen in the broader logistics and distribution sectors. The company is performing well at the top of the income statement; the issue is the high cost of being a publicly traded, rapidly expanding, and financially complex entity right now.

• Monitor Gross Margin: Needs to stay above 15% to prove the high-margin product strategy is sustainable.
• Watch Operating Expenses: Must decrease relative to revenue to push the Operating Margin toward zero.
• Track Non-Cash Charges: Look for a reduction in derivative and convertible note charges to narrow the Net Loss.

For a full picture of the company's position, including liquidity and valuation, you should check out the complete analysis at Breaking Down Cosmos Holdings Inc. (COSM) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

You need to know how Cosmos Holdings Inc. (COSM) pays for its growth, and right now, it's leaning slightly more on debt than the industry norm. As of the end of the third quarter of 2025, the company reported a total debt of $21.07 million. This total debt, which includes both short-term and long-term obligations, is a critical figure when assessing financial flexibility.

The key metric here is the Debt-to-Equity (D/E) ratio. This ratio tells you how much of the company's operations are financed by borrowing (debt) versus capital from shareholders (equity). Cosmos Holdings Inc.'s D/E ratio was approximately 0.91 as of Q3 2025. Here's the quick math: for every dollar of shareholder equity-which totaled $23.13 million-the company has about 91 cents of debt.

To be fair, a 0.91 D/E ratio is not catastrophic, but it's higher than the median for the U.S. Pharmaceutical Preparations industry, which typically sits around 0.64. This suggests a more aggressive use of financial leverage (using borrowed money to finance assets) compared to peers. It's a classic growth-vs-risk trade-off: debt can amplify returns, but it also raises risk, especially when liquidity is tight-the current ratio is just 0.99.

The company has been active on the financing front, which is defintely a point to watch. In Q3 2025, Cosmos Holdings Inc. secured a massive $300 million digital financing facility. This facility is intended to support digital asset investments and provide working capital, but it also contributed to the total liabilities rising to $46.36 million.

The balance of debt and equity funding is also shifting through non-cash methods. For example, the company has utilized convertible notes (a type of debt that can be exchanged for equity). Plus, in May 2025, the CEO converted a $34,000 debt into equity, a move that reduces debt while increasing the equity base. This kind of debt-to-equity conversion is a common tactic for smaller companies to clean up the balance sheet and manage near-term cash flow, but it also results in shareholder dilution.

• Total Debt (Q3 2025): $21.07 million
• Debt-to-Equity Ratio: 0.91 (Higher than the industry median of 0.64)
• Key Financing: Secured $300 million digital financing facility
• Financing Method: Uses convertible notes and debt-to-equity swaps

The takeaway is that Cosmos Holdings Inc. is actively using both debt and equity to fuel its expansion, but the recent debt-heavy moves and the D/E ratio above the industry median signal a higher reliance on borrowed capital. To understand the impact of these financing decisions on ownership structure, you should check out Exploring Cosmos Holdings Inc. (COSM) Investor Profile: Who's Buying and Why?

Liquidity and Solvency

You need to know if Cosmos Holdings Inc. (COSM) can cover its near-term bills, and the latest Q3 2025 numbers show a tight squeeze. The company's liquidity ratios are flashing a yellow light, but a significant financing move offers a counter-narrative for future flexibility.

The core measure of short-term financial health is the current ratio (current assets divided by current liabilities). As of the end of Q3 2025, Cosmos Holdings Inc. reported a current ratio of 0.99, meaning they have only 99 cents of current assets for every dollar of current liabilities. Honestly, you want to see a ratio of 1.5 or higher for a comfortable buffer. The quick ratio (or acid-test ratio), which strips out inventory-the least liquid current asset-is even tighter at 0.53.

Here's the quick math on what that means for immediate obligations:

• Current Ratio: 0.99 (Tight, barely covers short-term debt.)
• Quick Ratio: 0.53 (Suggests over-reliance on selling inventory to pay bills.)

This tight liquidity position translates directly into a negative working capital (current assets minus current liabilities). Based on the Q3 2025 balance sheet components, Cosmos Holdings Inc. is operating with a working capital deficit of approximately -$7.98 million (Current Assets of $36.27 million - Current Liabilities of $44.25 million). A negative figure means the company would have to sell long-term assets or rely on new financing to cover all its current obligations if they all came due at once. This is defintely a risk to map out.

Cash Flow Statements Overview

Analyzing the cash flow statement over the trailing twelve months (TTM) leading up to Q3 2025 shows where the pressure is coming from, and how the company is responding. Operating cash flow is the engine of any healthy business, and for Cosmos Holdings Inc., it's been a net drain.

The negative cash flow from operations (CFO) of -$7.69 million is the primary liquidity concern. It shows that, despite record revenue in Q3 2025 of $17.11 million, the core business is still consuming more cash than it generates. The company's response is the key opportunity here: securing that massive $300 million digital financing facility. This financing activity is a clear, aggressive move to inject capital and shore up the balance sheet, plus it provides additional working capital for growth initiatives. This move mitigates the immediate liquidity risk, but it also introduces new risks tied to the volatility of digital assets like Ethereum, which the company has begun purchasing.

The short-term liquidity is strained, but the recent financing provides a multi-year runway to fix the underlying operational cash flow problem. The next step is watching how effectively management uses this capital to turn that negative CFO positive. You can dive deeper into the strategic implications of this funding in Exploring Cosmos Holdings Inc. (COSM) Investor Profile: Who's Buying and Why?.

Valuation Analysis

When you look at Cosmos Holdings Inc. (COSM), the immediate question is whether the stock is overvalued or undervalued, and the answer is complex. The consensus from some analysts suggests the stock is currently Overvalued, which is a strong signal you can't ignore, especially given the company's financial history.

The traditional valuation metrics, which rely on positive earnings, paint a picture of a company still struggling for consistent profitability. For instance, the trailing twelve-month (TTM) Price-to-Earnings (P/E) ratio is highly negative, around -0.6x, because the company has been operating at a TTM net loss of approximately $15.37 million. This makes the P/E ratio effectively meaningless for comparison, a common issue with growth-focused or turnaround micro-cap stocks.

However, other ratios offer a clearer view. The Price-to-Book (P/B) ratio is currently around 0.96. Since this number is below 1.0, it technically suggests the stock is trading for less than the book value of its assets, which can be a classic sign of being undervalued. But you must pair this with the Enterprise Value-to-EBITDA (EV/EBITDA) ratio, which sits at a negative -2.21, reflecting the negative earnings before interest, taxes, depreciation, and amortization (EBITDA). Here's the quick math: negative earnings make all earnings-based ratios look distorted, so you have to focus on asset and sales multiples.

• P/E (TTM): -0.6x (Not meaningful due to net loss).
• P/B Ratio: 0.96 (Potentially undervalued on a book-value basis).
• EV/EBITDA: -2.21 (Reflects negative operational cash flow).

The stock price trend over the last 12 months shows extreme volatility, which is typical for a micro-cap with a high Beta of 4.38. The 52-week price range has been dramatic, moving between a low of $0.28 and a high of $1.32. As of November 19, 2025, the stock closed at approximately $0.649. While the 52-week price change is positive at about +11.15%, the overall sentiment is still bearish, and technical indicators currently signal a 'Sell Candidate'. This high volatility means the risk is defintely elevated.

Regarding income, Cosmos Holdings Inc. does not currently pay a dividend, meaning the dividend yield and payout ratios are 0.00% or not applicable. This is a non-starter for income-focused investors, but it's standard for a company prioritizing reinvestment to achieve scale and profitability.

To be fair, the company's recent Q3 2025 results show some operational improvements. For the nine months ended September 30, 2025, Cosmos Holdings Inc. reported a 13% increase in revenue to $45.57 million and saw its adjusted earnings per share (EPS) turn positive to $0.02. This is a significant shift from the prior year's loss, but the TTM ratios haven't fully caught up to this new, more positive trajectory.

Here is a snapshot of the key valuation data:

The stock's valuation is a classic risk-reward scenario: a low P/B ratio suggests asset value is not fully reflected, but the negative earnings-based ratios and the Altman Z-Score of -2.16-which puts the company in the financial distress zone-suggest a high risk of poor performance or even bankruptcy. Your next step should be to read the full analysis on Breaking Down Cosmos Holdings Inc. (COSM) Financial Health: Key Insights for Investors to understand the liquidity and debt position that drives this risk.

Risk Factors

You need to understand that Cosmos Holdings Inc. (COSM) is operating with a dual-edged sword right now. While the company is showing strong operational growth-Q3 2025 revenue hit a record $17.11 million, up 38% year-over-year-its financial health is still exposed to significant, high-volatility risks that are common with fast-scaling, diversified groups.

The core issue isn't their healthcare business; it's the financial structure and a bold, unconventional strategic bet. You're seeing a classic case where operational momentum is being overshadowed by financial and strategic volatility.

Operational and Financial Risks from Recent Filings

The most recent Q3 2025 results, released in November 2025, highlight a widening GAAP net loss of $5.35 million, which is a major red flag, even if it's mostly non-cash. Here's the quick math: this loss widened significantly from $2.18 million in Q3 2024, driven primarily by non-cash charges.

These charges relate to derivatives and convertible notes, which means the company's financing instruments are creating paper losses that hit the income statement hard. Also, the company's liquidity is tight; a current ratio of just 0.99, as of Q3 2025, means current assets barely cover current liabilities, requiring defintely disciplined cash management.

• Non-Cash Charges: $5.35 million net loss in Q3 2025 due to derivative and convertible note accounting.
• Tight Liquidity: Current ratio of 0.99 signals minimal working capital cushion.
• Debt Load: Total debt stands at $21.07 million, with a debt-to-equity ratio of 0.91.

The High-Volatility Digital Asset Bet

The biggest near-term risk is the company's aggressive move into digital assets. Cosmos Holdings Inc. secured a $300 million digital financing facility and has begun purchasing and staking Ethereum (ETH) to build a digital treasury. This is a massive divergence from traditional healthcare peers, and it introduces market risk that is completely outside their core competency.

To be fair, this is a growth strategy, but it's a high-conviction, high-caution move. For perspective, analysts have noted that a 30% drop in the price of Ethereum could erase approximately $65 million in value from their holdings, a significant hit for a company that reported nine-month 2025 revenue of $45.57 million.

External and Industry Headwinds

The company operates in the highly competitive and regulated healthcare and nutraceutical space. Competition for their flagship brands, like Sky Premium Life, is fierce globally. Plus, regulatory scrutiny is a constant headwind, especially as they expand their footprint in the U.S. and globally. The regulatory landscape for their new digital asset strategy is also a wildcard; new government rules on crypto could impact the value of their treasury overnight.

Mitigation Strategies and Clear Actions

The management team is not ignoring these risks; they are taking clear, strategic actions to build resilience. Their move to commence U.S. operations and sign a manufacturing agreement with DolCas Biotech is a smart way to mitigate tariff exposure and cross-border logistical risks for their Sky Premium Life brand.

Operationally, the focus on higher-margin segments-like nutraceuticals and contract manufacturing at Cana Laboratories-is paying off, driving the Q3 2025 gross margin to a record 15.21%. This strategic shift helps offset the lower margins of their wholesale distribution business. For a deeper dive into the company's long-term direction, you should review the Mission Statement, Vision, & Core Values of Cosmos Holdings Inc. (COSM).

Your next step is to monitor the upcoming earnings call on November 25, 2025, for an update on the digital asset treasury's performance and any further clarity on the non-cash charges.

Growth Opportunities

You're looking for a clear map of where Cosmos Holdings Inc. (COSM) is heading, and the picture is one of calculated risk and a strategic pivot toward higher-margin business lines. The company is actively shifting its revenue mix away from lower-margin wholesale distribution toward proprietary nutraceuticals and contract manufacturing, which is the key to their future profitability. This strategy is already showing real results, with Q3 2025 gross margin expanding to a record 15.21%, up significantly from the prior year.

The core growth story for Cosmos Holdings Inc. is built on three pillars: global brand expansion, a high-margin manufacturing push, and a unique digital treasury strategy that adds a layer of financial diversification. This isn't just a healthcare company anymore; it's a vertically integrated group with a unique, if volatile, financial twist. For a deeper look at who is buying into this strategy, you should check out Exploring Cosmos Holdings Inc. (COSM) Investor Profile: Who's Buying and Why?

Driving Revenue Through Strategic Expansion and Innovation

The most immediate and tangible growth driver is the expansion of their proprietary brands, particularly Sky Premium Life nutraceuticals, into the massive U.S. market. This move is supported by a new manufacturing partnership with DolCas Biotech LLC in New Jersey, which helps mitigate cross-border logistical and tariff risks.

This focus on owned, high-margin products is powerful. For example, their Sky Premium Life NOOR Collagen product alone is projected to generate over $12 million in annualized revenue from U.S. operations, with expected gross margins of approximately 75%. That's a game-changer for the overall margin profile. Plus, the company is doubling down on innovation, launching a new nanotechnology R&D program in October 2025 to develop next-generation nutraceutical formulas with enhanced efficacy.

• Launched U.S. manufacturing for Sky Premium Life to cut tariff risk.
• Signed contract to produce 3 million MYCOFAGYL pessaries annually.
• Expanded Sky Premium Life across the GCC region, starting with Oman.
• Initiated R&D partnerships leveraging AI drug repurposing for major health disorders.

Financial Momentum and Earnings Trajectory

While full-year 2025 projections are not explicitly stated by the company, we can see the momentum from the latest reported numbers. Revenue for the nine months ended September 30, 2025, totaled $45.57 million, a 13% increase over the prior year period. Q3 2025 revenue hit an all-time high of $17.11 million, reflecting a 38% year-over-year jump.

The push for higher-margin segments is the key to adjusted profitability. In Q1 2025, the company achieved an Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of $0.37 million, a significant turnaround from a loss in the prior year, showing cost discipline works.

Competitive Edge and Near-Term Risk

Cosmos Holdings Inc.'s competitive advantage (economic moat) isn't a single product; it's the combination of vertical integration and financial innovation. Owning the manufacturing arm, Cana Laboratories, and controlling the distribution chain gives them a cost and quality advantage over competitors who rely solely on third parties. The company's strategic decision to allocate a portion of a $300 million digital financing facility to a digital assets portfolio, including $2 million in Ethereum (ETH) as of October 2025, is their boldest differentiator.

Honestly, this dual strategy is a calculated gamble. The Ethereum investment offers a potential yield of 4-6% annually through staking, plus capital appreciation, but it also introduces high volatility (a Beta of 5.86 is defintely high). The underlying healthcare operations must continue to grow to justify this treasury strategy, but with a strengthening balance sheet-total assets reached $69.49 million in Q3 2025-the company has built a financial cushion to execute its plan.