Q2 Performance: What Happened?
Nongwoo Bio reported KRW 43.3 billion in revenue for Q2 2025, a 15.8% increase quarter-over-quarter but a 5.7% decrease year-over-year. Operating income fell to KRW 3.2 billion, a 57.9% decline QoQ, and net income dropped to KRW 2.5 billion, a 61.5% decrease QoQ. Year-over-year, operating income increased by 77.8%, while net income decreased by 3.8%.
Why the Profitability Decline?
The primary drivers behind the decline in operating income are not yet clear, but potential factors include rising raw material costs, increased SG&A expenses, and the impact of foreign exchange fluctuations and volatile oil prices.
Impact on Investors
In the short term, the decline in profitability could negatively impact the stock price. The significant drop in profit compared to Q1 2025 warrants investor caution. However, the year-over-year improvement in operating income and the growth potential of the agricultural market could be seen as positive factors.
Investor Action Plan
- » Analyze the detailed breakdown of Q2 results to understand the specific factors contributing to the decline in profitability.
- » Assess Nongwoo Bio’s strategy for managing the increasing volatility in foreign exchange rates.
- » Analyze the outlook for the agricultural market in the second half of the year.