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Intellinetics (INLX)
:INLX
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Intellinetics (INLX) AI Stock Analysis

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INLX

Intellinetics

(NYSE MKT:INLX)

Rating:50Neutral
Price Target:
$9.00
▼(-3.12% Downside)
Intellinetics' overall stock score reflects significant challenges in financial performance and technical analysis, with declining revenue and bearish market momentum. However, positive corporate events and strategic investments provide a foundation for potential future growth. The company's ability to secure large contracts and eliminate debt are notable strengths, but current profitability issues and market sentiment weigh heavily on the score.

Intellinetics (INLX) vs. SPDR S&P 500 ETF (SPY)

Intellinetics Business Overview & Revenue Model

Company DescriptionIntellinetics, Inc. designs, develops, tests, markets, and licenses document services and software solutions in the United States. The company operates in two segments, Document Management and Document Conversion. Its software platform allows its customers to capture and manage documents across operations, such as scanned hard-copy documents and digital documents, including Microsoft Office 365, digital images, audios, videos, and emails. The company's flagship software suite includes IntelliCloud platform that comprises image processing modules, records management, workflow, and extended components. It also provides installation, integration, training, and consulting services; ongoing software maintenance and customer support services; and digital scanning, microfilm and microfiche, box storage, scanning equipment, and software and repair services, as well as long-term paper and microfilm storage, and retrieval option services. In addition, the company offers business process outsourcing services. Intellinetics, Inc. sells its products to resellers and directly to customers, as well as provides access to its software solutions as a service through the Internet. It serves business and federal, county, and municipal governments, as well as healthcare, K-12 education, public safety, other public sector, risk management, financial services, and others. The company was formerly known as GlobalWise Investments, Inc. and changed its name to Intellinetics, Inc. in September 2014. Intellinetics, Inc. was incorporated in 1996 and is headquartered in Columbus, Ohio.
How the Company Makes MoneyIntellinetics generates revenue primarily through the sale of its software licenses, subscription services, and ongoing maintenance and support agreements. The company has a recurring revenue model, which is bolstered by its subscription-based offerings for cloud services, allowing clients to access their document management systems on a pay-as-you-go basis. Additionally, Intellinetics benefits from professional services, including implementation, training, and consulting, which contribute to its earnings. The company has also established partnerships with other technology providers to enhance its service offerings and reach new markets, further solidifying its revenue streams.

Intellinetics Earnings Call Summary

Earnings Call Date:Aug 13, 2025
(Q2-2025)
|
% Change Since: -11.52%|
Next Earnings Date:Nov 17, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed outlook for Intellinetics. While the company has achieved significant milestones such as a successful contract renewal, SaaS revenue growth, and debt elimination, it also faces challenges with declining overall revenue, increased expenses, and a net loss for the quarter. The company is optimistic about future growth and has made strategic investments in sales and marketing to drive future success.
Q2-2025 Updates
Positive Updates
Successful Contract Renewal
Intellinetics renewed a 5-year contract with their largest customer, with an additional 5-year extension option, providing a stable revenue horizon.
SaaS Revenue Growth
SaaS revenue grew by 12.6% in Q2 compared to the previous year, driven by early successes in payables automation.
Improved Gross Margin
Consolidated gross margin increased by 328 basis points to 68%, a result of a favorable revenue mix and reduced professional services volume.
Debt Elimination
The company paid off $7.6 million in debt and earnouts, improving its financial standing.
Positive Customer Feedback
High customer satisfaction in the homebuilding market, with 80% of customers live and the rest moving towards live dates.
Negative Updates
Revenue Decline
Total revenue for Q2 2025 decreased by 13.6% to $4.0 million compared to the previous year, primarily due to a reduction in professional services.
Increased Operating Expenses
Operating expenses increased by 21.1% to $3.6 million, driven by investments in sales, marketing, and infrastructure.
Net Loss
The company reported a net loss of $568,000 for Q2 compared to a net income of $75,000 in the previous year, impacted by reduced professional services and increased spending.
Professional Services Revenue Drop
Professional services revenue decreased by 29% to $1.9 million, contributing to the overall revenue decline.
Company Guidance
During the Intellinetics Second Quarter 2025 Earnings Call, the company provided guidance reflecting a temporary dip in revenue, with total revenue for Q2 2025 decreasing by 13.6% to $4.0 million compared to $4.6 million in the same period last year. This decline was primarily due to a 29% decrease in professional services revenue, attributed to the renewal timing of a significant contract. Despite this setback, SaaS revenue displayed resilience, growing by 12.6% to $1.6 million. The company maintained a strong consolidated gross margin of 68%, an increase of 328 basis points from the previous year, driven by a favorable revenue mix. Operating expenses increased by 21.1% due to investments in sales and marketing. The company reported a net loss of $568,000 for Q2 2025, contrasting with a net income of $75,000 in the prior year. Despite the temporary revenue challenges, Intellinetics remains optimistic, expecting SaaS growth to continue and professional services to rebound by the end of Q3 2025. The company's guidance anticipates 2025 revenues to be lower than 2024, yet it aims to maintain positive adjusted EBITDA through strategic investments aimed at long-term growth.

Intellinetics Financial Statement Overview

Summary
Intellinetics faces challenges with declining revenue and profitability, as reflected in the income statement. The balance sheet shows manageable leverage but negative returns on equity. Cash flow analysis indicates potential liquidity issues with declining free cash flow growth. Overall, the company needs to address operational inefficiencies and improve cash generation to enhance financial stability.
Income Statement
45
Neutral
The income statement shows declining revenue growth with a negative trend in profitability. The TTM data indicates a negative net profit margin of -10.17%, and a negative EBIT margin of -5.81%, reflecting operational challenges. The gross profit margin remains relatively stable at 63.73%, but the overall financial health is impacted by declining revenue and profitability.
Balance Sheet
55
Neutral
The balance sheet indicates a moderate debt-to-equity ratio of 0.16 in the TTM period, suggesting manageable leverage. However, the return on equity is negative at -16.20%, indicating inefficiencies in generating returns for shareholders. The equity ratio is not explicitly calculated, but the overall balance sheet reflects a need for improved financial performance.
Cash Flow
50
Neutral
The cash flow statement shows a decline in free cash flow growth by -32.61% in the TTM period, indicating potential liquidity challenges. The operating cash flow to net income ratio is 0.48, suggesting moderate cash generation relative to net income. The free cash flow to net income ratio is 0.69, reflecting some ability to convert earnings into cash.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue17.13M18.02M16.89M14.02M11.46M8.25M
Gross Profit10.92M11.52M9.59M8.19M6.94M4.99M
EBITDA-244.52K1.03M2.08M2.19M2.86M-1.05M
Net Income-1.74M-546.22K519.27K24.03K1.36M-2.20M
Balance Sheet
Total Assets17.16M18.57M19.03M19.94M11.96M10.34M
Cash, Cash Equivalents and Short-Term Investments2.07M2.49M1.22M2.70M1.75M1.91M
Total Debt1.85M3.55M5.65M7.02M5.69M5.10M
Total Liabilities5.59M7.94M9.28M11.37M9.30M9.19M
Stockholders Equity11.56M10.63M9.75M8.57M2.66M1.15M
Cash Flow
Free Cash Flow1.56M3.42M236.58K1.41M799.48K48.13K
Operating Cash Flow2.25M3.86M784.66K1.99M1.39M124.99K
Investing Cash Flow-900.91K-827.77K-548.08K-6.96M-590.49K-4.10M
Financing Cash Flow-960.11K-1.76M-1.72M5.92M-954.73K5.47M

Intellinetics Technical Analysis

Technical Analysis Sentiment
Negative
Last Price9.29
Price Trends
50DMA
11.83
Negative
100DMA
12.52
Negative
200DMA
12.82
Negative
Market Momentum
MACD
-0.94
Positive
RSI
28.49
Positive
STOCH
18.70
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INLX, the sentiment is Negative. The current price of 9.29 is below the 20-day moving average (MA) of 10.65, below the 50-day MA of 11.83, and below the 200-day MA of 12.82, indicating a bearish trend. The MACD of -0.94 indicates Positive momentum. The RSI at 28.49 is Positive, neither overbought nor oversold. The STOCH value of 18.70 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for INLX.

Intellinetics Risk Analysis

Intellinetics disclosed 40 risk factors in its most recent earnings report. Intellinetics reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Intellinetics Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
62
Neutral
27.23%47.65%
61
Neutral
$35.62B8.22-10.94%1.88%8.86%-10.36%
50
Neutral
$41.61M-15.90%-2.63%-1080.14%
$125.41M
51
Neutral
$120.37M-274.34%172.93%34.97%
37
Underperform
$53.09M-21.38%
$34.94M0.25
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
INLX
Intellinetics
9.80
0.23
2.40%
TROO
TROOPS
1.16
-3.14
-73.02%
PHUN
Phunware
2.68
-0.74
-21.64%
DUOT
Duos Technologies Group
6.47
4.07
169.58%
NUKK
Nukkleus
4.94
2.58
109.32%
SYT
SYLA Technologies Co., Ltd. ADR
1.50
-0.22
-12.79%

Intellinetics Corporate Events

Shareholder MeetingsBusiness Operations and Strategy
Intellinetics Terminates Promissory Notes, Boosts Growth Prospects
Positive
Jun 24, 2025

Intellinetics, Inc. announced on June 24, 2025, that it has prepaid and terminated all outstanding promissory notes, amounting to $1,373,740, without penalty. This strategic move reflects the company’s confidence in its future growth and its ability to reinvest resources into accelerating sales and development. The prepayment was part of a broader effort to build a cash-generating operation, with the company having repaid $4.96 million in debt principal since 2020. Intellinetics held its 2025 Annual Meeting of Stockholders on June 18, 2025, where directors were elected and the appointment of GBQ Partners LLC as the independent registered public accounting firm was ratified. The company aims to leverage its debt-free status to pursue growth opportunities and enhance shareholder value.

Business Operations and Strategy
Intellinetics Secures Largest Contract in Company History
Positive
Jun 2, 2025

On May 28, 2025, Graphic Sciences, Inc., a subsidiary of Intellinetics, Inc., secured a five-year contract renewal with the State of Michigan for document management services, valued at an estimated $42.75 million. This contract, effective from June 1, 2025, to May 30, 2030, allows Michigan’s subdivisions and agencies to procure services at a fixed price, though the contract can be terminated under certain conditions. Separately, Intellinetics announced its largest contract in company history, a $40 million agreement for document scanning and conversion services, set to begin on June 1, 2025. This contract was awarded after a competitive evaluation process and positions Intellinetics to focus on delivering high-quality services and exploring further revenue opportunities, particularly in SaaS solutions.

Private Placements and Financing
Intellinetics Enters $10M At The Market Offering
Neutral
May 28, 2025

On May 28, Intellinetics Inc. entered into an At The Market Offering Agreement with Lucid Capital Markets, LLC, allowing the company to offer and sell up to $10,000,000 of its common stock through the agent. This agreement provides flexibility in selling shares directly on the NYSE American or through negotiated transactions, with the agent receiving a 3% commission on sales. The arrangement can be terminated by either party and does not obligate the company or agent to sell or buy shares, with no assurance of sales being made.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 19, 2025