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Netsol (NTWK)
:NTWK
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Netsol Technologies
(NASDAQ:NTWK)
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Rating:61Neutral
Price Target:
$4.50
▼(-0.22% Downside)
Netsol Technologies' overall score is driven by strong earnings call results and solid financial performance, despite challenges in cash flow management and technical indicators suggesting bearish momentum. The valuation is moderate, with room for improvement in profitability.
Netsol Technologies (NTWK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$48.44M
Dividend YieldN/A
Average Volume (3M)105.86K
Price to Earnings (P/E)16.6
Beta (1Y)0.82
Revenue Growth7.65%
EPS Growth311.31%
CountryUS
Employees1,569
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.22
Shares Outstanding11,785,540
10 Day Avg. Volume71,661
30 Day Avg. Volume105,855
Financial Highlights & Ratios
PEG Ratio0.04
Price to Book (P/B)0.95
Price to Sales (P/S)0.54
P/FCF Ratio-38.48
Enterprise Value/Market Cap0.68
Enterprise Value/Revenue0.50
Enterprise Value/Gross Profit1.01
Enterprise Value/Ebitda3.91
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Netsol Technologies Business Overview & Revenue Model
Company DescriptionNetsol Technologies (NTWK) is a global provider of software solutions and services, primarily operating in the information technology and consulting sectors. The company specializes in offering enterprise software solutions for the leasing and finance industry, alongside providing business process outsourcing services. Key products include its LeasePak and LeaseSoft platforms, which streamline operations for businesses in the finance sector, enhancing efficiency and compliance.
How the Company Makes MoneyNetsol Technologies generates revenue through multiple streams, primarily focusing on software licensing and implementation services for its proprietary platforms like LeasePak and LeaseSoft. The company also earns income from ongoing maintenance and support contracts, ensuring clients receive continuous updates and assistance. Additionally, Netsol engages in consulting services that help businesses optimize their processes and integrate software solutions effectively. Strategic partnerships with financial institutions and technology providers further enhance its market reach and revenue potential, allowing the company to leverage collaborative opportunities for growth and innovation.
Netsol Technologies Earnings Call Summary
Earnings Call Date:Sep 29, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong positive momentum with significant revenue growth, new strategic partnerships, and operational improvements. However, there were challenges with the decline in license fees and increased operating expenses due to strategic investments.Q4-2025 Updates
Positive Updates
Strong Revenue Growth
Total net revenues for the fourth quarter increased 11.9% to $18.4 million, compared with $16.4 million in the prior year period. Fiscal 2025 total net revenues were $66.1 million, up from $61.4 million in fiscal 2024.
Increase in Subscription and Support Revenues
Subscription and support revenues grew 9.9% in Q4 to $8.2 million from $7.5 million in the same period last year. Full year subscription and support revenues were $32.9 million, up from $28 million in the previous year.
Significant Contract Wins
Secured a $16 million, five-year contract with a major US automaker and a multi-million dollar deal with a major Chinese automotive finance company. Entered the Middle East with a deal in Oman.
Operational Efficiency Improvements
Gross profit for the quarter was $10.3 million, representing a 56% gross margin, up from 52% in the prior year quarter. Operating expenses decreased to 39% of sales from 47%.
Leadership Strengthening
Added Richard Howard as an advisory board member and Ian Smith to the Board of Directors, both with extensive experience in the automotive and financial services sectors.
Negative Updates
Decline in License Fees
License fees for the year were $0.6 million, compared to $5.4 million in the prior year, reflecting a significant decline due to the transition to a subscription-first model.
Increased Operating Expenses
Operating expenses totaled $29.1 million for fiscal 2025, up from $25.8 million last year, due to investments in growth areas and global delivery capabilities.
Company Guidance
During the fiscal year 2025 earnings call, NetSol Technologies provided guidance focused on growth, innovation, and operational efficiency. The company reported a significant shift towards a subscription-based revenue model, with subscription and support revenues increasing by 9.9% to $8.2 million in Q4. This contributed to a total net revenue increase of 11.9% for the quarter, amounting to $18.4 million, and a full-year revenue of $66.1 million, up from $61.4 million in the previous year. NetSol highlighted the success of its AI-powered Transcend platform, which secured a $16 million, five-year contract with a major US automaker, and a multi-million dollar deal with a Chinese automotive finance company. The company also reported improvements in gross profit margin, rising to 56% in Q4, and a substantial increase in non-GAAP EBITDA to $4.7 million. While specific guidance for fiscal 2026 was not provided, the company expressed optimism about sustaining growth and continuing its strategic focus on expanding its SaaS offerings, driving innovation, and improving operational leverage.Netsol Technologies Financial Statement Overview
Summary
Netsol Technologies shows solid revenue growth and a strong balance sheet with effective cost management. However, profitability and cash flow management are concerns, with low net profit margins and negative free cash flow growth.Income Statement
Netsol Technologies has shown consistent revenue growth over the years, with a recent increase of 3.06% in 2025. The gross profit margin has improved to 49.29% in 2025, indicating efficient cost management. However, the net profit margin remains relatively low at 4.42%, suggesting room for improvement in profitability. The EBIT and EBITDA margins have decreased compared to previous years, which could indicate rising operational costs.65
Positive
Balance Sheet
The company maintains a healthy debt-to-equity ratio of 0.24, reflecting a balanced approach to leveraging. Return on equity has improved to 7.73% in 2025, showing better utilization of shareholder funds. The equity ratio stands at 60.57%, indicating a strong equity position relative to total assets. Overall, the balance sheet reflects stability and prudent financial management.70
Positive
Cash Flow
Netsol Technologies faces challenges in cash flow management, with a significant decline in free cash flow growth by -115.45% in 2025. The operating cash flow to net income ratio is low at 0.02, indicating potential issues in converting income into cash. The negative free cash flow to net income ratio suggests that the company is not generating sufficient free cash flow relative to its net income.50
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 66.09M | 66.09M | 61.39M | 52.39M | 57.25M | 54.92M |
| Gross Profit | 32.57M | 32.57M | 29.28M | 16.92M | 23.74M | 25.39M |
| EBITDA | 8.38M | 4.97M | 6.09M | 791.66K | 6.27M | 7.64M |
| Net Income | 2.92M | 2.92M | 683.87K | -5.24M | -851.16K | 1.78M |
Balance Sheet | ||||||
| Total Assets | 62.44M | 62.44M | 64.19M | 58.38M | 72.61M | 86.61M |
| Cash, Cash Equivalents and Short-Term Investments | 17.36M | 17.36M | 19.13M | 15.53M | 23.96M | 33.71M |
| Total Debt | 9.14M | 9.14M | 7.67M | 7.11M | 10.04M | 13.49M |
| Total Liabilities | 20.18M | 20.18M | 24.65M | 21.60M | 21.75M | 24.74M |
| Stockholders Equity | 37.83M | 37.83M | 34.84M | 33.81M | 45.40M | 54.65M |
Cash Flow | ||||||
| Free Cash Flow | -935.50K | -935.50K | 2.39M | 370.13K | 451.42K | 13.17M |
| Operating Cash Flow | 447.27K | 447.27K | 2.91M | 2.01M | 3.06M | 15.73M |
| Investing Cash Flow | -1.27M | -1.27M | -291.54K | -1.40M | -2.26M | -2.52M |
| Financing Cash Flow | 822.88K | 822.88K | 239.55K | -718.99K | -1.38M | -1.17M |
Netsol Technologies Technical Analysis
Neutral
4.51
Price Trends
4.51
Negative
4.17
Negative
3.36
Positive
Market Momentum
-0.13
Positive
41.37
Neutral
22.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTWK, the sentiment is Neutral. The current price of 4.51 is above the 20-day moving average (MA) of 4.36, above the 50-day MA of 4.51, and above the 200-day MA of 3.36, indicating a neutral trend. The MACD of -0.13 indicates Positive momentum. The RSI at 41.37 is Neutral, neither overbought nor oversold. The STOCH value of 22.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NTWK.
Netsol Technologies Risk Analysis
Netsol Technologies disclosed 3 risk factors in its most recent earnings report. Netsol Technologies reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
Netsol Technologies Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $64.32M | 32.23 | 20.82% | ― | -0.45% | -1.40% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $48.44M | 16.63 | 8.04% | ― | 7.65% | 311.31% | |
49 Neutral | $47.45M | -8.41 | -18.98% | ― | 2.73% | 25.65% | |
39 Underperform | $33.09M | >-0.01 | -108.13% | ― | 445.29% | 87.35% | |
37 Underperform | $46.03M | ― | -18.69% | ― | ― | ― |
* Technology Sector Average
NTWK
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CYN
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Netsol Technologies Corporate Events
NETSOL Technologies Reports Strategic Growth and Expansions
Oct 1, 2025
NETSOL Technologies, Inc. is a global provider of innovative technology solutions, specializing in AI-powered asset finance and leasing software, serving clients in over 30 countries across the automotive and financial sectors. The company recently reported its annual earnings, highlighting strategic agreements and expansions. Key achievements include a multi-year agreement with a Japanese automotive manufacturer for its Transcend™ Finance platform in Australia and New Zealand, expected to enhance operational efficiencies and digital transformation. Additionally, NETSOL secured a significant maintenance and upgrade contract and expanded its managed service portfolio with new client engagements. Looking forward, NETSOL aims to leverage its strategic partnerships and innovative solutions to drive growth and maintain its competitive edge in the global market.
NetSol Technologies Reports Robust Q4 Growth Amid Strategic Shifts
Oct 1, 2025
The recent earnings call for NetSol Technologies painted a picture of strong positive momentum, driven by significant revenue growth, new strategic partnerships, and operational improvements. However, the company also faced challenges, notably a decline in license fees and increased operating expenses due to strategic investments.
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.