Breaking Down Zomedica Corp. (ZOM) Financial Health: Key Insights for Investors

You're looking at Zomedica Corp. and trying to figure out if their recent growth is a real turning point or just noise, and honestly, the Q3 2025 numbers give us a clear map. The company hit a record quarterly revenue of $8.1 million, a solid 16% jump year-over-year, which is defintely a win in the animal health space. But still, the bottom line shows a net loss of $6.1 million for the quarter, so while the top-line growth is impressive-especially the 51% surge in Diagnostics revenue driven by the TRUFORMA platform-we have to be realists about the cash burn (the rate at which a company spends money, typically leading to a loss). The good news is the balance sheet remains strong with $54.4 million in cash and securities as of September 30, 2025, which buys them a lot of runway, but the core question for investors is when that growth translates to profitability, not just a shrinking loss.

Revenue Analysis

You want to know if Zomedica Corp. (ZOM) is building a sustainable business, and the third quarter of 2025 (Q3 2025) results give us a clear answer: revenue is growing, but the business mix is shifting. The company posted a record quarterly revenue of $8.1 million in Q3 2025, which is a solid 16% year-over-year (YoY) increase. This marks the 19th straight quarter of YoY revenue growth, which tells you they are defintely executing on their commercial strategy.

The revenue stream is split into three main segments, but it's not an even distribution. The Therapeutic Device segment remains the primary engine, anchored by products like the PulseVet shock wave system and Assisi therapeutic devices. Here's the quick math on how the latest quarter breaks down, showing where the money is really coming from.

The Therapeutic Device segment is the foundation, contributing over 80% of the total revenue in Q3 2025, but its growth rate was a modest 3%. The real opportunity, and the biggest change, is in the Diagnostics segment and the new Development Services stream. Diagnostics revenue, which includes the TRUFORMA point-of-care platform, surged by an impressive 51% YoY, showing that the adoption of their newer technology is finally accelerating.

Also, don't overlook the introduction of the Development Services segment, which brought in $0.7 million this quarter. This is a new revenue stream where Zomedica is leveraging its manufacturing and engineering capabilities, including work for a company in the human health space. It's a smart way to monetize existing infrastructure and intellectual property (IP), and it immediately accounts for almost 9% of total quarterly sales. This diversification away from purely veterinary product sales is a key strategic shift. For a deeper dive into the company's long-term vision, you can read the Mission Statement, Vision, & Core Values of Zomedica Corp. (ZOM).

The recurring revenue component is also critical. Total consumable sales-things like PulseVet trodes and TRUFORMA assays-were up 14% YoY in Q3 2025. This metric is a direct indicator of the installed base's health; more consumables sold means more devices are being used actively in veterinary practices. International sales are also a bright spot, growing by 16%, supported by new distribution deals in markets like the UK, Netherlands, and Canada.

What this estimate hides is the fact that the Diagnostics segment still only represents a small fraction of total revenue, despite its high growth. You need to see that 51% growth rate sustained to truly balance the revenue mix. Overall, year-to-date revenue through Q3 2025 is up 11%, so the company is consistently moving in the right direction.

Profitability Metrics

You're looking at Zomedica Corp. (ZOM) to understand if its strong revenue growth is translating into real profitability. The direct takeaway is that while the company maintains a high gross profit margin, a hallmark of a specialty medical device firm, it is defintely still in a heavy investment phase, resulting in significant operating and net losses.

For the third quarter of 2025, Zomedica Corp. (ZOM) reported record revenue of $8.1 million, an increase of 16% year-over-year. This growth is a solid sign that their strategy of acquiring and integrating multiple product lines, like the TRUFORMA® diagnostic platform and PulseVet® therapeutic device, is working. However, the path to true profitability (net income) remains a long one.

Gross, Operating, and Net Profit Margins

Zomedica Corp. (ZOM)'s strongest financial metric is its Gross Profit Margin. This ratio shows how efficiently the company turns sales into profit before accounting for operating expenses (like R&D and Sales). Here is the breakdown for the third quarter ended September 30, 2025:

• Gross Profit Margin: A robust 67%. This means for every dollar of revenue, 67 cents remain after paying for the cost of goods sold.
• Operating Profit Margin: A deep negative of approximately -81.15%. The calculated operating loss was around $6.57 million.
• Net Profit Margin: A negative of approximately -75.31%. The net loss for the quarter was $6.1 million.

Here's the quick math: Revenue of $8.1 million multiplied by the 67% gross margin yields a Gross Profit of about $5.43 million. When you subtract the $12.0 million in total operating expenses, you get the operating loss. The high gross margin is great, but the high operating expenses are eating it all up, and then some.

Comparative Profitability and Operational Efficiency

Zomedica Corp. (ZOM)'s gross margin is highly competitive, which speaks volumes about its product pricing power and cost of manufacturing. However, the comparison to industry giants highlights the difference between a growth-stage company and established, profitable leaders.

The company's operational efficiency, or cost management, is the key variable right now. The gross margin of 67% is higher than IDEXX Laboratories' 61.8%, showing Zomedica Corp. (ZOM) has a strong product-level economic model. However, their total operating expenses of $12.0 million in Q3 2025 are still significantly higher than their gross profit. This is a common profile for a company investing heavily in sales, marketing, and research to scale its business.

Profitability Trends and Actions

The good news is the trend is moving in the right direction. The net loss of $6.1 million in Q3 2025 was a 9% improvement (narrowing) compared to the net loss of $6.7 million in the same quarter last year. This narrowing loss, combined with a stable, high gross margin, indicates that the increased revenue is starting to cover a larger portion of the fixed operating costs. The goal is to reach cash flow breakeven, and management is focused on this. You can see their strategic focus on expansion in documents like Mission Statement, Vision, & Core Values of Zomedica Corp. (ZOM).

For investors, the action is simple: Monitor the operating expense trend closely. They need to keep their gross margin high while leveraging their existing infrastructure to grow revenue faster than their operating expenses. The strong gross margin is a competitive advantage; they just need to scale revenue to match their fixed cost base. Finance: Track the ratio of total operating expenses to gross profit quarterly to see how quickly they are achieving operating leverage.

Debt vs. Equity Structure

Zomedica Corp. (ZOM) has a capital structure that is defintely unique in the animal health space, relying almost entirely on equity funding and maintaining an essentially debt-free balance sheet. This lack of financial leverage is a key part of their near-term strategy as they drive toward profitability.

As of the third quarter ended September 30, 2025, Zomedica Corp. reported being essentially debt-free, a point the management team frequently emphasizes. To be precise, the total debt is minimal, hovering around $2.35 million, which is negligible compared to the total shareholder equity of approximately $119.7 million. This means the company is not burdened by interest payments or principal repayments, which is a huge operational advantage.

Here's the quick math: the Debt-to-Equity (D/E) ratio-a measure of a company's financial leverage-comes in at an ultra-conservative 0.02 (or 2%). You can't get much lower than that. For context, established, profitable peers in the animal health sector carry significantly more debt: Zoetis (ZTS) operates with a D/E ratio of 1.35, and IDEXX Laboratories (IDXX) is at about 0.31.

• ZOM's D/E Ratio: 0.02 (Ultra-low leverage)
• Industry Peer Average (Approx.): 0.31 to 1.35 (Significant leverage)

The company's financing strategy is simple: use cash on hand to fund growth. They ended Q3 2025 with a strong liquidity position of $54.4 million in cash, cash equivalents, and available-for-sale securities. This cash hoard primarily came from prior equity financing rounds, including a significant capital raise during the 2020-2021 meme stock phenomenon. This means Zomedica Corp. is funding its operations, R&D (like the TRUFORMA® platform expansion), and strategic acquisitions entirely from shareholder capital, not from banks or bondholders.

What this estimate hides is that while Zomedica Corp. is debt-free, they are still burning cash, albeit at a reduced rate. Cash used during Q3 2025 was approximately $4.7 million, the lowest cash burn in nearly three years. The strategy is to continue reducing operating expenses and increasing revenue-which hit a record $8.1 million in Q3 2025-to reach cash flow breakeven without needing to tap the debt markets. This approach greatly reduces financial risk but also means the cost of capital is higher, as equity is generally more expensive than debt.

Since the company is not leveraging debt, there is no recent news on credit ratings, debt issuances, or refinancing activity. Their focus is purely operational and commercial, aiming to accelerate the global adoption of their expanding portfolio. For a deeper dive into the company's long-term goals, you can review the Mission Statement, Vision, & Core Values of Zomedica Corp. (ZOM).

Liquidity and Solvency

You're looking at Zomedica Corp. (ZOM)'s balance sheet to see if they can cover their near-term bills, and the short answer is: they are sitting on a mountain of liquid assets. The company's liquidity position is defintely a source of strength, but we still need to look closely at the underlying cash burn.

As of the second quarter of 2025, Zomedica Corp.'s liquidity ratios were exceptionally high, signaling a minimal risk of short-term default. The Current Ratio stood at a robust 8.44, and the more conservative Quick Ratio (which strips out inventory) was 7.74. For context, a ratio above 1.0 is generally considered healthy, so these figures are far above the industry median of approximately 1.9 for Medical Devices & Instruments. This tells us Zomedica Corp. can cover its current liabilities more than seven times over with just its most liquid assets.

• Current Ratio: 8.44 (Q2 2025)
• Quick Ratio: 7.74 (Q2 2025)
• Cash/Securities: $54.4 million (Q3 2025)

This strong liquidity translates directly into a massive working capital surplus. The trend is clear: Zomedica Corp. has maintained a significant cash reserve, which was $54.4 million in cash, cash equivalents, and available-for-sale securities as of September 30, 2025. This reserve is the legacy of past financing and gives them a huge buffer. It's a great position, but a ratio this high can also hint at capital inefficiency-holding too much cash that isn't being put to work for growth.

Now, let's look at the cash flow statement, which is where the rubber meets the road. The company's cash flow from operating activities (CFO) for the trailing twelve months (TTM) ending September 2025 was a negative $21.28 million. This is the cash burn rate, meaning the company is still spending more on its day-to-day operations than it is generating from sales. Here's the quick math: the cash used during the third quarter of 2025 alone was approximately $4.7 million, which is a positive trend-the year-to-date cash reduction through Q3 2025 was about $17 million, which is 25% less than the same period in 2024. They are slowing the burn.

The other cash flow components are less dramatic. Cash flow from investing activities (CFI) is small, reflecting minimal capital expenditures (CapEx) of around $1.04 million TTM, which is typical for a company focused on sales execution over heavy new facility build-outs. Cash flow from financing activities (CFF) is also negligible, as the company has virtually no debt, with a Debt-to-Equity ratio of less than 0.01. This means they aren't relying on new debt or equity raises to fund operations right now, which is a major strength.

The key takeaway is that Zomedica Corp. has a strong liquidity buffer-the $54.4 million in cash is enough to cover the TTM operating cash outflow for more than two years at the current burn rate, assuming no revenue growth. The risk isn't immediate insolvency; the risk is the continued negative operating cash flow, which must eventually turn positive to justify the valuation. For a deeper dive into the revenue drivers, check out Breaking Down Zomedica Corp. (ZOM) Financial Health: Key Insights for Investors.

Valuation Analysis

You're looking at Zomedica Corp. (ZOM) and asking the core question: is the stock priced fairly right now? The short answer is that traditional metrics suggest it is undervalued based on its tangible assets and future revenue projections, but you must factor in the inherent risk of a company that is still losing money.

As of November 2025, the stock trades at approximately $0.11 a share. Over the last 12 months, the stock price has fallen by about -30.94%, which is a tough pill to swallow for any investor. This drop reflects market skepticism about the path to profitability, even as the company's revenue grows.

The Problem with Profitability Ratios

For a growth company like Zomedica Corp., the standard valuation tools often break down. We can't use the Price-to-Earnings (P/E) ratio because the company is not profitable; it has a negative P/E. This is common in the veterinary health tech space where upfront investment in R&D and sales is huge.

Here's the quick math on profitability: the estimated quarterly Earnings Per Share (EPS) for the end of 2025 is projected to be -$0.01. Their third-quarter 2025 net loss was $6.1 million. You are buying a story of future earnings, not current profit.

The Enterprise Value-to-EBITDA (EV/EBITDA) ratio is also negative, sitting around -1.06 (Trailing Twelve Months, or TTM). This negative figure simply confirms the company's operating losses-their Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is negative. It tells you they are burning cash to fuel growth, not generating operating profit yet.

Asset and Analyst Views

The Price-to-Book (P/B) ratio, which compares the stock price to the company's book value per share, gives a different picture. As of November 20, 2025, the TTM P/B ratio is approximately 0.90. This is an interesting signal because a P/B ratio below 1.0 suggests the stock is trading for less than the value of its net assets (what shareholders would theoretically get if the company liquidated). It defintely suggests the market is valuing the company conservatively, below its balance sheet assets.

The analyst community, however, sees a significant upside. The average one-year price target is a robust $0.26, which implies a potential return of over 162.08% from a recent trading price. The consensus rating is mildly positive, with roughly an 80% Buy consensus from the handful of analysts covering the stock. They are betting on the projected 2025 revenue of $35.16 million translating into a higher valuation multiple.

What this estimate hides is the execution risk. The company does not pay a dividend, with both the dividend yield and payout ratio at 0.00%. All capital is being reinvested into the business.

• P/E Ratio: Not Applicable (Negative EPS)
• P/B Ratio (Nov 2025 TTM): 0.90
• EV/EBITDA Ratio (TTM): -1.06
• Analyst Price Target: $0.26

For a deeper dive into the company's operational performance, check out Breaking Down Zomedica Corp. (ZOM) Financial Health: Key Insights for Investors.

Risk Factors

You're looking at Zomedica Corp. (ZOM) and seeing record revenue, but you have to be a realist about the risks that come with a growth-focused company still working toward consistent profitability. The direct takeaway is that while the company has a strong cash balance, the primary near-term risk remains the burn rate and the need to convert capital sales into high-margin, recurring consumable revenue.

The biggest financial risk is the ongoing net loss. For the first nine months of the 2025 fiscal year, Zomedica Corp. reported a substantial net loss of approximately $77.33 million. To be fair, this figure is heavily skewed by a massive, one-time, non-cash impairment charge of $55.8 million recorded in the first quarter of 2025, which stemmed from a decline in market capitalization. What this estimate hides is the underlying operational loss, which is still significant.

Operationally, the company is still using cash, though they are improving. Through the end of the third quarter in 2025, their cash has reduced by approximately $17 million, which is an improvement-it's 25% less than the cash reduction seen over the same period in 2024. Still, they are not cash-flow positive yet. They ended Q3 2025 with a strong liquidity position of $54.4 million in cash and securities, which gives them a cushion.

External and strategic risks are a constant for a company in the veterinary health space. The market is competitive, and Zomedica Corp.'s success is tied to the continued adoption of its key product platforms, like the TRUFORMA® diagnostic system and the PulseVet® therapeutic device.

• Industry Competition: Fierce rivalry in veterinary diagnostics and therapeutics, requiring constant innovation.
• Regulatory Changes: Shifts in FDA or international veterinary device regulations could slow down product launches.
• Product Acceptance: Relying on veterinarians to accept and integrate new technology like TRUFORMA® into their practice workflows.

A key strategic risk is the reliance on recurring revenue. While Diagnostics revenue was up 51% in Q3 2025, and consumable revenues grew to $5.4 million, the company needs to keep that momentum going to justify the initial capital equipment sales. That's the whole business model: sell the machine, then sell the cartridges forever. For more on their long-term vision, you can check out their Mission Statement, Vision, & Core Values of Zomedica Corp. (ZOM).

The mitigation strategy is clear and focused: cut costs and grow high-margin sales. Management has been disciplined, reducing total operating expenses to $12.0 million in Q3 2025-their lowest quarterly spend in two years. They are striving for cash flow breakeven and profitability by leveraging their existing scalable production capacity and expecting continued cash usage reductions into 2026.

Here's the quick math: with $54.4 million in cash and a Q3 2025 cash burn of approximately $4.7 million, they have a solid runway, but they defintely need to hit profitability soon.

Growth Opportunities

You're looking at Zomedica Corp. (ZOM) and asking the right question: can this company translate its product portfolio into sustainable profit? The direct takeaway is that Zomedica is defintely shifting from an acquisition-heavy phase to an execution-focused one, aiming to hit an analyst-projected annual revenue of around $35.16 million for the 2025 fiscal year. That's a solid increase from the $27 million reported for 2024.

The company's growth strategy centers on three clear pillars: product innovation that drives recurring revenue, international market expansion, and disciplined cost management to narrow the net loss, which was $6.1 million in the third quarter of 2025. They have the cash, approximately $54.4 million as of September 30, 2025, to fund this near-term push.

Key Growth Drivers: Consumables and Diagnostics

The real engine for future growth isn't the one-time sale of a machine; it's the consumable products that drive recurring revenue. Zomedica's Diagnostics segment, which includes the TRUFORMA point-of-care platform, is a core driver, showing a massive 51% growth in the third quarter of 2025. This platform uses Bulk Acoustic Wave (BAW) sensor technology to give veterinarians lab-quality results right in the clinic, and that means a steady stream of revenue from the assay cartridges.

Here's the quick math: the U.S. total addressable market (TAM) for their recurring revenue products, like assays and consumables, is estimated to be over $2.5 billion annually. Getting a larger slice of that pie is the goal. Product innovations in 2025, like the launch of the TRUFORMA Enhanced Endogenous ACTH Assay for equine diagnosis in February, and the September expansion of the Cobalamin & Folate Assay for feline use, directly feed this high-margin, sticky revenue stream.

• Accelerate adoption of TRUFORMA platform.
• Increase sales of PulseVet and Assisi therapeutic consumables.
• Expand the new Development Services segment, which contributed $0.7 million in Q3 2025.

Strategic Market Expansion and Partnerships

A major opportunity lies outside the domestic U.S. market. The company's strategic alliance with the Leader Healthcare Group in July 2024 is a clear move to capture international share. This partnership makes Leader Healthcare the exclusive distributor for Zomedica's entire product line across the Gulf Cooperation Council (GCC) countries, Egypt, and India.

To be fair, international expansion brings logistical and regulatory hurdles, but the market potential is huge. The Middle East and North Africa (MENA) veterinary market is valued at roughly $4 billion and is growing at 5%, plus the Indian market is another $1 billion growing at 7%. That's a significant new revenue channel if execution is strong. Also, the company is leveraging its earlier acquisitions, like VETIGEL hemostatic gel, to round out its product offerings and cross-sell to a broader customer base.

Competitive Advantages and Financial Health

Zomedica's main competitive advantage is its portfolio of differentiated, point-of-care technology, especially in diagnostics and non-invasive therapeutics. The TRUFORMA platform's proprietary Bulk Acoustic Wave (BAW) technology, which the company gained greater control over with the acquisition of Qorvo Biotechnologies, allows for rapid, accurate testing that saves veterinarians time and improves patient care. This focus on workflow improvement and patient outcome is a strong selling point in the veterinary space.

Financially, the company is getting more efficient. They are showing great gross margins, hitting 67% in Q3 2025, and operating expenses are down 6% year-over-year through the third quarter, a reduction of $2.5 million. This cost discipline is critical as they chase profitability. While the company is still reporting a net loss, the trend of increasing revenue and decreasing operating expenses is what you want to see in a growth-stage company. You can dig deeper into the shareholder makeup in Exploring Zomedica Corp. (ZOM) Investor Profile: Who's Buying and Why?

Next step: Dig into the competitive landscape for the TRUFORMA platform to see if the technology advantage is durable.