Sprocomm Intelligence Limited (1401) AI Stock Analysis

• Market Cap: HK$1.53B
• Dividend Yield: N/A
• Average Volume (3M): 2.87M
• Price to Earnings (P/E): 70.8
• Beta (1Y): 0.35
• Revenue Growth: -0.54%
• EPS Growth: -46.27%
• Country: HK
• Employees: 1,414
• Sector: Technology
• Sector Strength: 88
• Industry: Consumer Electronics
• EPS (TTM): <0.01
• Shares Outstanding: 1,500,000,000
• 10 Day Avg. Volume: 1,762,600
• 30 Day Avg. Volume: 2,870,600
• PEG Ratio: -1.84
• Price to Book (P/B): 4.06
• Price to Sales (P/S): 0.51
• P/FCF Ratio: -32.68
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: HK$1.00 ▲(51.52% Upside)

The score is driven down primarily by weaker financial performance (declining revenue, negative operating margins, and missing 2024 cash flow data). Technicals are supportive due to a strong trend above moving averages, but overbought signals temper the outlook. Valuation is a notable headwind given the very high P/E and no dividend yield data.

Positive Factors

Telecom infrastructure services exposure

Core focus on wireless telecom network deployment and engineering gives durable demand exposure to network rollouts, maintenance, and upgrades. Structural 5G/coverage investments and operator capex cycles support recurring service needs and long-term contract opportunities.

Prior strong free cash flow track record

A substantial prior-year free cash flow demonstrates the company's capacity to convert operations into real cash, supporting reinvestment, debt service, and weathering cyclical periods. Historical FCF provides a credible base for liquidity planning if cash generation resumes.

Manageable reported leverage

A moderate D/E around 0.5 indicates the company is not over-levered relative to peers, leaving room to fund project activity and capex without acute solvency stress. Reasonable leverage helps preserve financing flexibility for multi-year network contracts.

Negative Factors

Revenue decline

A multi-digit revenue decline signals weakening demand or lost share in core services, eroding scale advantages. Sustained top-line contraction constrains reinvestment, reduces bargaining power with suppliers, and makes margin recovery and long-term growth harder to achieve.

Operating profitability deterioration

Shift to negative EBIT/EBITDA indicates structural pressure on operating economics, whether from pricing, higher input costs, or underutilized capacity. Persistent negative margins undermine cash flow generation, limit reinvestment, and raise risk of restructuring or capital raises.

Missing 2024 operating/free cash flow

Absence of reported 2024 operating/free cash flow creates material uncertainty around liquidity and cash conversion quality. Without visible cash generation, the firm may need external financing for capex or working capital, increasing refinancing and solvency risk over the coming months.

Sprocomm Intelligence Limited Business Overview & Revenue Model

Company Description

Future Machine Limited is an investment holding company engaged in R&D, design, manufacturing, and sale of mobile phones, PCBAs, and IoT-related products across China, India, Algeria, Bangladesh, and internationally. Also involved in cloud computing, trading of mobile devices and auto/education tools, and provision of customer/technical support services; changed name in July 2025 to Future Machine Limited from Sprocomm Intelligence.

How the Company Makes Money

Sprocomm Intelligence Limited generates revenue through multiple streams. Its primary source of income comes from the sale of software licenses for its analytics and optimization products, which are tailored for telecommunications companies and other enterprises. Additionally, the company earns revenue from subscription-based services for ongoing access to its AI platforms and updates. Professional services, including consulting and implementation support, also contribute significantly to its earnings. Strategic partnerships with major telecommunications firms and technology providers further enhance its market reach and create opportunities for co-development projects, thereby boosting its financial performance.

Sprocomm Intelligence Limited Financial Statement Overview

Summary

Mixed fundamentals: revenue declined (-3.16%) and EBIT/EBITDA margins turned negative. Balance sheet shows moderate but rising leverage (D/E 0.51) and weaker ROE (4.44%). Cash flow is a key concern due to missing operating/free cash flow data for 2024 versus strong prior-year FCF, reducing confidence in liquidity and cash generation.

Income Statement

Sprocomm Intelligence Limited exhibited a mixed performance. The gross profit margin for 2024 is approximately 8.83%, which is a decline from 10.61% in 2023, indicating decreased efficiency in cost management. The net profit margin improved to 0.56% from 1.15% in 2023, highlighting better bottom-line management despite lower revenues. Revenue growth was negative at -3.16% from 2023 to 2024, showing a decline in sales, but the EBIT and EBITDA margins both turned negative, reflecting challenges in operational profitability.

Balance Sheet

The balance sheet reflects moderate leverage with a debt-to-equity ratio of 0.51, which is manageable but has increased from 0.46 in 2023. The return on equity (ROE) was 4.44%, a decrease from 9.19% in 2023, indicating lower efficiency in generating profits from equity. The equity ratio stands at 10.84%, suggesting a low proportion of assets financed by equity, pointing to potential stability risks if liabilities grow.

Cash Flow

Cash flow statements show that the company did not report any operating or free cash flow for 2024, a significant drop from 2023's strong free cash flow of $1.565 billion. This absence of cash flow data indicates potential liquidity issues or unreported cash movements. The operating cash flow to net income and free cash flow to net income ratios cannot be evaluated due to missing data, raising concerns about cash generation efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.26B	2.92B	2.82B	1.45B	2.00B	2.18B
Gross Profit	283.61M	257.77M	299.59M	203.63M	172.24M	193.42M
EBITDA	6.43M	-3.19M	110.69M	591.00K	-25.52M	-674.00K
Net Income	17.69M	16.34M	32.37M	6.51M	-17.75M	30.88M
Balance Sheet
Total Assets	3.42B	3.40B	3.82B	1.46B	1.10B	1.21B
Cash, Cash Equivalents and Short-Term Investments	113.12M	79.36M	67.95M	36.63M	82.90M	28.10M
Total Debt	190.64M	187.06M	162.75M	57.68M	78.46M	60.17M
Total Liabilities	3.04B	3.03B	3.47B	1.14B	786.86M	872.34M
Stockholders Equity	379.48M	368.14M	352.08M	320.22M	315.92M	333.34M
Cash Flow
Free Cash Flow	475.20M	-45.69M	1.57B	547.36M	18.23M	-70.67M
Operating Cash Flow	487.57M	-27.12M	1.57B	555.86M	21.35M	-40.15M
Investing Cash Flow	-36.74M	260.15M	-1.59B	-567.85M	53.39M	79.32M
Financing Cash Flow	-368.15M	-222.28M	47.69M	-35.94M	-17.35M	-138.03M

Sprocomm Intelligence Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.66
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1401, the sentiment is Positive. The current price of 0.66 is below the 20-day moving average (MA) of 0.79, below the 50-day MA of 0.67, and below the 200-day MA of 0.83, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 65.85 is Neutral, neither overbought nor oversold. The STOCH value of 59.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1401.

Sprocomm Intelligence Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
1810	70 Outperform	HK$924.56B	18.97	19.56%	―	35.67%	122.22%
1070	66 Neutral	HK$30.28B	13.48	13.06%	2.96%	21.26%	94.52%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
1401	54 Neutral	HK$1.53B	70.83	4.74%	―	-0.54%	-46.27%
0751	53 Neutral	HK$13.45B	47.40	1.76%	―	6.10%	-70.77%
6133	46 Neutral	HK$161.50M	-7.45	-4.14%	―	3.70%	5.90%
2369	40 Underperform	HK$252.27M	-1.28	-13.04%	―	8.62%	-24.87%

Sprocomm Intelligence Limited Corporate Events

Future Machine Signs Strategic MOUs to Drive Emerging-Market Expansion and Integrated Solutions Push

Future Machine Limited has signed nine memorandums of understanding with major telecommunications and mobile phone distribution companies across the United Arab Emirates, Bangladesh, India, Sri Lanka and Türkiye, marking a strategic push into emerging markets and a shift from a traditional ODM business to exporting integrated mobile and smart-device solutions. Under these long-term partnerships, the Group will supply mobile phones and smart devices, support brand promotion and market share expansion, assist selected partners in building local manufacturing and R&D capabilities, and co-develop shared intellectual property, with initial orders of 1.5 million handsets worth about USD100 million expected to boost global revenue diversification, deepen its technology ecosystem and strengthen its competitive position over the long term.

The most recent analyst rating on (HK:1401) stock is a Sell with a HK$0.68 price target. To see the full list of analyst forecasts on Sprocomm Intelligence Limited stock, see the HK:1401 Stock Forecast page.

Future Machine Eases Shareholding Concentration With More Dispersed Investor Base

Future Machine Limited has disclosed an updated shareholding analysis as of 14 November 2025, showing a more dispersed ownership structure following earlier regulatory concerns about high shareholding concentration. According to an independent service provider’s report, the two substantial shareholders, Leap Elite Limited and Beyond Innovation Limited, now hold 20.50% and 14.00% of the company’s 1.5 billion issued shares, respectively, while a broad base of 585 individual shareholders and 37 corporate shareholders collectively own over 61% of the stock, and smaller and unidentifiable shareholders hold the remainder. This reshaped distribution suggests that the previously flagged concentration risk has eased, enhancing transparency and potentially improving stock liquidity and market confidence by placing a larger proportion of shares in the hands of a wider investor base.

The most recent analyst rating on (HK:1401) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on Sprocomm Intelligence Limited stock, see the HK:1401 Stock Forecast page.

Future Machine Limited Completes Rights Issue, Raising HK$140 Million

Future Machine Limited, a company incorporated in the Cayman Islands, successfully completed its Rights Issue, raising approximately HK$140 million in gross proceeds. The Rights Issue was initially under-subscribed, but all remaining shares were placed with independent investors. The net proceeds of approximately HK$138 million will be used to support the company’s mobile phone and related products business, expand production lines, enhance workforce capacity, and explore strategic investments, particularly in the artificial intelligence sector.

The most recent analyst rating on (HK:1401) stock is a Hold with a HK$0.50 price target. To see the full list of analyst forecasts on Sprocomm Intelligence Limited stock, see the HK:1401 Stock Forecast page.