Octopus Digital profit collapses 95%

October 23, 2025 (MLN): Octopus Digital Group has reported a disastrous nine-month performance, with its profit after tax plunging by 94.53% for the period ended September 30, 2025.

According to the company’s consolidated unaudited results, profit collapsed to Rs5.02 million, compared to Rs91.87m in the same period last year.

The steep decline reflects a perfect storm of falling revenues, escalating costs, and surging finance and tax burdens, which together eroded the company’s profitability.

Revenues for the nine months decreased by 11.39% to Rs749.71m, signaling either weak market demand or the loss of key contracts.

At the same time, the cost of revenue increased by 9.41%, directly squeezing the company’s margins.

Consequently, gross profit fell to Rs329.99m, compared to Rs462.46m a year earlier.

Despite some cost-control efforts, the decline in gross profit proved too significant to offset. Profit from operations nosedived by 76.89%, settling at Rs23.09m.

The only notable positive was a near doubling of Other Income to Rs37.53m, which offered limited relief against the broader financial strain.

The financial stress is clearly reflected in the company’s profitability margins:

• Gross Profit Margin dropped sharply from 54.66% in 2024 to 44.02% in 2025, indicating the core business has become far less profitable, possibly due to competitive pricing pressures or rising input costs.

• Net Profit Margin plummeted from 10.86% to just 0.67%, showing that almost all revenue is now being absorbed by costs and expenses, leaving minimal returns for shareholders.

The company’s bottom line was further eroded by sharp increases in external expenses.

Finance Costs surged 88.56% to Rs5.37m, suggesting higher borrowing costs or greater reliance on debt financing.

Taxation saw a colossal increase of 222.68% to Rs12.56m, turning a weak operating performance into an abysmal net profit figure.

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