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Investing.com -- Sadot Group Inc. (NASDAQ:SDOT) shares fell 6.4% after the global food supply chain company reported second quarter earnings that beat expectations but showed a significant revenue decline from the previous year.
The company posted adjusted earnings per share of $0.07 for the second quarter, exceeding analyst estimates. Revenue came in at $114.3 million, representing a substantial 34% decrease from $173.3 million in the same period last year.
Despite the revenue decline, Sadot Group achieved a gross margin of 4.4%, a 100 basis point improvement as the company focused on higher-margin specialty commodities and trades in its Canadian subsidiary.
"This marks our fifth consecutive quarter of positive net income and EBITDA," said Haggai Ravid, who joined as CEO on May 28, 2025. "Our strategic focus on specialty commodities is yielding improved margins despite challenging market conditions."
The company reported net income of $0.4 million and EBITDA of $1.7 million for the quarter. Sadot completed 26 transactions involving over 200,000 metric tons of agricultural commodities across seven countries during the period.
In a strategic move to diversify its operations, Sadot acquired a 37.5% equity stake in Special Development Group, an Indonesian carbon project focused on restoring peatland and mangrove ecosystems.
The project is expected to generate between 1.1 and 1.2 million high-integrity carbon credits in its first issuance cycle.
The company maintained a solid financial position with a working capital surplus of $24.2 million at the end of the quarter, though cash reserves decreased to $422,000 from $1.8 million at the end of 2024.
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