tiprankstipranks
Trending News
More News >
Socket Mobile (SCKT)
NASDAQ:SCKT
Advertisement

Socket Mobile (SCKT) AI Stock Analysis

Compare
315 Followers

Top Page

SCKT

Socket Mobile

(NASDAQ:SCKT)

Rating:44Neutral
Price Target:
$1.00
▼(-5.66% Downside)
Socket Mobile's overall score is primarily influenced by its weak financial performance and negative valuation. While technical analysis also indicates bearish trends, some optimism arises from strategic moves like the convertible note financing and potential growth in new markets. However, these positives are overshadowed by significant financial challenges and uncertain business conditions.

Socket Mobile (SCKT) vs. SPDR S&P 500 ETF (SPY)

Socket Mobile Business Overview & Revenue Model

Company DescriptionSocket Mobile, Inc. provides data capture and delivery solutions in the United States, Europe, Asia, and internationally. The company's products are incorporated into mobile applications used in point of sale, commercial services, asset tracking, manufacturing process and quality control, transportation and logistics, event management, medical, and education. It provides cordless data capture devices that connect over Bluetooth and work with applications running on smartphones, mobile computers, and tablets; and software developer kits to application developers to enable them to provide their users with its advanced barcode scanning features. The company's cordless data capture devices include DuraScan 700 series, including D700 1D linear imaging scanner; D730 1D laser barcode scanner; D740, D745, D750, D755, and D760 universal barcode scanners that reads all common 1D, stacked, 2D, and postal codes; and SocketScan 800 series cordless barcode scanners, including S800, a 1D linear imaging scanner, and S840 and S860 2D scanner that are attachable to smartphones, tablets, and other mobile devices. It also provides D600 contactless RFID/Near Field Communications reader writer that can read and write various types of electronic SmartTags or transfer data with near field communication; and S550, a contactless membership card reader/writer. The company offers SocketCare services program, which provides extended warranty and accidental breakage coverage for various products. It serves retail, commercial, industrial and manufacturing, transportation and logistics, healthcare, government, travel and hospitality, education, and agriculture and farming industries through a network of distributors, online resellers, and application providers, as well as online stores. The company was formerly known as Socket Communications, Inc. and changed its name to Socket Mobile, Inc. in April 2008. Socket Mobile, Inc. was incorporated in 1992 and is headquartered in Newark, California.
How the Company Makes MoneySocket Mobile generates revenue through the sale of its hardware products, including barcode scanners and NFC devices, which are marketed to businesses in various industries. Key revenue streams include direct sales to end-users, distribution agreements with third-party resellers, and partnerships with software developers that integrate Socket Mobile's devices into their applications. The company also benefits from recurring revenue through ongoing support services, accessories, and software updates, which enhance the value of its products. Additionally, strategic partnerships with technology companies and participation in industry-specific events contribute to brand visibility and customer acquisition, further bolstering its earnings.

Socket Mobile Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q2-2025)
|
% Change Since: -5.36%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a challenging quarter with significant revenue decline and increased operating losses. However, there are positive developments in new market expansions and cost management improvements. The outlook remains cautious with a focus on managing expenses and achieving EBITDA neutrality.
Q2-2025 Updates
Positive Updates
XtremeScan Deployment Success
Successfully delivered the first XtremeScan products to a large industrial customer with flawless deployment, indicating positive reception and performance.
New Market Expansion
Achieved significant milestones in expanding into the industrial scanning and handheld computing markets, gaining traction with multiple Fortune 50 companies and diversifying beyond retail.
Cost Management Improvement
Operating expenses reduced to $2.7 million from $3.1 million in the previous year, reflecting effective cost control measures.
Improved EBITDA Performance
Recorded an EBITDA loss of $100,000, significantly improved from a $481,000 loss in Q1 2025.
Negative Updates
Revenue Decline
Revenue decreased by 20% year-over-year to $4 million, indicating significant softness in demand.
Increased Operating Loss
Operating loss increased to $700,000 compared to $500,000 in Q2 2024, showing financial strain.
Delayed XtremeScan Deployment
Significant portion of the XtremeScan deployment delayed to 2026, affecting immediate growth potential.
EBITDA Neutral Outlook
Outlook revised to expect EBITDA neutral performance in the second half of 2025, rather than profitability.
Company Guidance
During Socket Mobile's Q2 2025 earnings call, the company reported a 20% decrease in revenue to $4 million compared to Q2 2024, with margins slipping slightly from 51% to 50%. The operating loss increased to $700,000 from $500,000 year-over-year. Despite the challenging quarter, the company achieved an EBITDA loss of just over $100,000, significantly improved from the $481,000 loss in Q1 2025. Operating expenses were reduced to $2.7 million from $3.1 million in Q2 2024. Cash reserves stood at $2.6 million as of June 30, bolstered by $1.5 million in convertible note financing. Inventory levels decreased to $4.8 million, reflecting tighter inventory management. Despite the soft market, Socket Mobile successfully delivered its first XtremeScan products, marking a positive step in its expansion into the industrial scanning market. The company remains focused on managing expenses while investing in research and development to seize significant Apple-related opportunities. The outlook for the second half of 2025 has been adjusted to be EBITDA neutral.

Socket Mobile Financial Statement Overview

Summary
Socket Mobile is facing significant challenges in terms of revenue growth, profitability, and cash flow generation. Despite a conservative balance sheet, the persistent negative margins and declining stockholders' equity raise concerns about long-term financial health. Addressing operational inefficiencies and improving cash flow are critical for future stability.
Income Statement
35
Negative
Socket Mobile has faced declining revenue over the past few years, with a significant drop from $23.2 million in 2021 to $18.8 million in 2024. Gross profit margin has decreased from 53.6% in 2021 to 50.4% in 2024, indicating pressure on profitability. The net profit margin has also been negative in recent years, with a -11.9% margin in 2024, reflecting ongoing losses. The EBIT and EBITDA margins have deteriorated further into negative territory, showing operational inefficiencies and challenges in managing operating expenses.
Balance Sheet
60
Neutral
The balance sheet of Socket Mobile shows a manageable debt-to-equity ratio of 0.37 in 2024, which indicates a conservative leverage position. However, stockholders' equity has declined from $20 million in 2021 to $18.2 million in 2024, reflecting the impact of sustained losses. The equity ratio has remained relatively stable at 66.4% in 2024, suggesting a solid asset base relative to liabilities. Despite this stability, the declining equity position is a concern.
Cash Flow
40
Negative
Socket Mobile's cash flow situation is concerning, with operating cash flow falling to zero in 2024 from $48,562 in 2023, indicating challenges in cash generation from core operations. Free cash flow has been negative in recent years, highlighting issues in covering capital expenditures and potential liquidity constraints. The lack of cash flow growth and a negative free cash flow to net income ratio indicate cash flow management issues.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue17.75M18.76M17.03M21.24M23.20M15.70M
Gross Profit8.94M9.45M8.46M10.37M12.44M8.33M
EBITDA-1.20M-881.60K-1.73M833.33K3.41M-2.63M
Net Income-2.68M-2.24M-1.92M86.93K4.47M-3.28M
Balance Sheet
Total Assets27.16M27.35M28.74M28.60M25.58M15.61M
Cash, Cash Equivalents and Short-Term Investments1.71M2.49M2.83M3.62M6.10M2.12M
Total Debt6.66M6.79M6.28M5.24M2.23M2.18M
Total Liabilities9.92M9.19M9.32M8.28M5.53M4.44M
Stockholders Equity17.24M18.16M19.42M20.32M20.05M11.17M
Cash Flow
Free Cash Flow-1.94M-1.31M-2.12M-1.29M1.45M267.96K
Operating Cash Flow-1.16M-521.49K48.56K-111.42K2.14M804.45K
Investing Cash Flow-784.19K-715.52K-2.16M-1.18M-691.77K-536.48K
Financing Cash Flow878.59K902.34K1.32M-1.18M2.52M894.94K

Socket Mobile Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price1.06
Price Trends
50DMA
1.13
Negative
100DMA
1.14
Negative
200DMA
1.24
Negative
Market Momentum
MACD
-0.03
Negative
RSI
48.64
Neutral
STOCH
87.45
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SCKT, the sentiment is Neutral. The current price of 1.06 is above the 20-day moving average (MA) of 1.05, below the 50-day MA of 1.13, and below the 200-day MA of 1.24, indicating a neutral trend. The MACD of -0.03 indicates Negative momentum. The RSI at 48.64 is Neutral, neither overbought nor oversold. The STOCH value of 87.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SCKT.

Socket Mobile Risk Analysis

Socket Mobile disclosed 27 risk factors in its most recent earnings report. Socket Mobile 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

Socket Mobile Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
68
Neutral
¥243.52B15.346.64%2.42%9.16%-0.15%
60
Neutral
$42.79M-24.73%-9.09%-1586.89%
60
Neutral
$108.53M-44.58%4.65%-79.75%
53
Neutral
$84.45M-23.11%-73.87%-115.50%
44
Neutral
$8.20M-16.13%-5.39%-54.90%
41
Neutral
$44.58M33.98%-17.08%-223.70%
40
Underperform
$59.90M-164.37%1.90%93.50%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SCKT
Socket Mobile
1.06
0.02
1.92%
INVE
Identiv
3.52
0.03
0.86%
QMCO
Quantum
7.03
2.83
67.38%
TACT
Transact Technologies
4.25
-0.20
-4.49%
UAVS
AgEagle Aerial Systems
1.92
-22.03
-91.98%
OSS
One Stop Systems
5.65
3.58
172.95%

Socket Mobile Corporate Events

Private Placements and Financing
Socket Mobile Extends Convertible Notes Maturity Date
Neutral
Aug 1, 2025

Socket Mobile, Inc. completed a secured subordinated convertible note financing of $1,530,000 on August 31, 2020. The company has extended the maturity date of these notes multiple times, with the latest extension on July 31, 2025, pushing the maturity date to August 30, 2027. This extension agreement was approved by the company’s disinterested directors due to the involvement of related parties, including key executives and board members.

Executive/Board ChangesShareholder Meetings
Socket Mobile Holds 2025 Annual Stockholders Meeting
Neutral
Jun 4, 2025

On June 4, 2025, Socket Mobile, Inc. held its virtual 2025 Annual Meeting of Stockholders where six directors were elected, executive compensation policies were approved, and Sadler, Gibb & Associates LLC was ratified as the independent public accountants for the fiscal year 2025. The meeting saw a quorum with 68.1% of total shares voted, resulting in the election of all nominated directors, approval of executive compensation with 91.3% affirmative votes, and ratification of the accounting firm with 94.3% affirmative votes.

Private Placements and FinancingBusiness Operations and Strategy
Socket Mobile Completes Convertible Note Financing
Positive
Jun 2, 2025

On May 30, 2025, Socket Mobile, Inc. completed a $1,500,000 secured subordinated convertible note financing to enhance its working capital. The notes, maturing in 2028, offer a 10% annual interest rate and are convertible into common stock, with key company executives participating in the financing. This move underscores the company’s efforts to strengthen its financial position and involves significant insider participation, reflecting confidence in its strategic direction.

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 02, 2025