Gold.com, Inc. Q2 FY2025 earnings call

Management Statement and Operational Highlights

• Financial Performance: Second quarter results reflected the strength of the integrated platform despite slower market conditions, elevated precious metal prices, and subdued demand. Earnings were $0.27 per diluted share, and non-GAAP EBITDA was $16.2 million.
• Strategic Plans: Nearing completion of facility expansion and logistic initiatives at A-Mark Global Logistics in Las Vegas. Advancing reach in Asia with an established DTC presence in Singapore. Entered into a definitive agreement to acquire Spectrum Group International, expanding into premium collectible and luxury markets.
• Operating Metrics: Sold 466,000 ounces of gold in Q2 2025 (up 4% year-over-year), 21.8 million ounces of silver (down 18% year-over-year). The DTC segment had 65,400 new customers in Q2 2025 (up 25% year-over-year) and 3.2 million total customers (up 31% year-over-year). The DTC average order value was $3,178 in Q2 2025 (up 43% year-over-year). The inventory turn ratio was 2.2 in Q2 2025 (up 16% year-over-year).

Segment Performance

• Revenue: Fiscal Q2 2025 revenues were $2.742 billion, up 32% from $2.079 billion in Q2 2024. Excluding forward sales, revenue increased 38%. The DTC segment contributed 21% of consolidated revenue in Q2 2025 vs. 18% in 2024. JMB's revenue was 11% in 2025 vs. 16% in 2024. For the six-month period, revenues were $5.457 billion, up 20% from $4.563 billion. The DTC segment contributed 19% of consolidated revenue in the six months ended December 31, 2024 vs. 15% in 2023, and JMB's revenue was 11% vs. 14% in the same period.
• Gross Profit: Q2 2025 gross profit was $44.8 million (1.63% of revenue), down from $46 million (2.22%) in 2024. The DTC segment contributed 56% of consolidated gross profit in Q2 2025 vs. 48% in 2024, and JMB contributed 38% vs. 41% in 2024. For the six-month period, gross profit was $88.2 million (1.62% of revenue), down from $95.4 million (2.09%) in 2023. The DTC segment contributed 55% of consolidated gross profit in the six months ended December 31, 2024 vs. 45% in 2023, and JMB contributed 37% vs. 38% in the same period.
• SG&A Expenses: Q2 2025 SG&A expenses were $25.8 million, up 15% from $22.4 million in 2024. For the six-month period, SG&A expenses were $52.4 million, up 18% from $44.2 million in 2023.
• Depreciation and Amortization: Q2 2025 depreciation and amortization was $4.6 million, up 65% from $2.8 million in 2024. For the six-month period, it was $9.3 million, up 67% from $5.6 million in 2023.
• Interest Income/Expense: Q2 2025 interest income was $6.8 million, up 8% from $6.3 million; interest expense was $10.4 million, up 2% from $10.2 million. For the six-month period, interest income was $13.9 million, up 12% from $12.4 million; interest expense was $20.4 million, up 2% from $20 million.
• Net Income: Q2 2025 net income was $6.6 million ($0.27 per diluted share), down from $13.8 million ($0.57) in 2024. For the six-month period, net income was $15.5 million ($0.65 per diluted share), down from $32.6 million ($1.34) in 2023.
• Non-GAAP EBITDA: Q2 2025 non-GAAP EBITDA was $16.2 million, down 35% from $25.1 million in 2024. For the six-month period, non-GAAP EBITDA was $34 million, down 39% from $55.5 million in 2023.

Guidance

• Management is nearing completion of facility expansion and logistic initiatives at A-Mark Global Logistics. Executing plans to advance reach in Asia and explore M&A opportunities. Entered into an agreement to acquire Spectrum Group International, expecting accretive results and continued M&A activity to drive long-term value.

Risks

• Risks include failure to complete the proposed acquisition of Spectrum Group International, regulatory issues, impacts from the international political climate, supply chain problems, increased competition, changes in consumer demand, inflationary pressure, and risks related to commodity markets and investee companies.

Question and Answer

Q: How far back in history do we have to go for comparable low volatility and elevated gold prices?

A: Gregory Roberts said circumstances are similar to recent quarters, comparable to 1980 in silver terms.

Q: Counter cyclicality of numismatics and wine efforts from SGI deal?

A: Gregory Roberts discussed synergies with Stacks' customer base, cross-selling opportunities, and higher margins.

Q: Stacks' performance and profitability?

A: Stacks had front-loaded first six months, with large August auction and acquisition of Brunn Collection driving results.

Q: Marketing efforts for DTC channel?

A: Continued strategy to increase active customers and reengage old customers, seeing good results in reactivating and acquiring new customers.

Q: Timing and synergies of SGI acquisition?

A: Acquisition provides access to balance sheet, lower costs, and growth opportunities, expected to be accretive.

Q: Geographic expansion in Asia?

A: Focus on Singapore, with plans to build out office and retail space, currently focused on domestic M&A opportunities.

Q: Accretiveness of SGI deal and M&A activity?

A: Expecting accretive results, with focus on non-dilutive, accretive deals and active M&A in next 90 days.

Q: Capital allocation and dividend/buyback?

A: Balancing M&A, buybacks, and dividends, with recent stock buyback and focus on accretive acquisitions.