U.S. Global Investors (GROW) Q2 2025 earnings summary

Executive summary

• Reported a net loss of $86,000, or $0.01 per share, for Q2 FY2025 on operating revenues of $2.2 million, with average assets under management of $1.5 billion, down from $2.1 billion a year earlier.

• Launched the U.S. Global Technology and Aerospace & Defense ETF (WAR) in December 2024, expanding thematic offerings and marking the first actively managed ETF.

• Continued focus on Smart Beta 2.0 strategies, thematic ETF launches, and shareholder value through dividends and disciplined buybacks.

• Outperformed the Russell Microcap Index over five years, returning 90% versus 28%.

• Six-month net income was $229,000, down from $1.1 million year-over-year, mainly due to a $1.6 million decrease in advisory fees.

Financial highlights

• Operating revenues for Q2 FY2025 were $2.2 million, down 21% year-over-year, mainly from a 21% drop in advisory fees and lower AUM.

• Operating expenses increased 5% to $2.8 million, primarily from higher employee compensation and advertising.

• Net loss for the quarter was $86,000, or $0.01 per share, compared to net income of $1.2 million, or $0.09 per share, in the prior year.

• Cash and cash equivalents stood at $26 million, with no long-term debt and a current ratio of 20:1.

• Shareholder yield as of December 31, 2024, was 10%, significantly above Treasury yields.

Outlook and guidance

• Management remains optimistic about thematic ETF growth, especially in defense, technology, and travel sectors, and expects continued interest in gold and precious metals ETFs.

• Monthly dividend of $0.0075 per share (3.67% yield) approved through March 2025, reviewed quarterly.

• Ongoing focus on stock buybacks, cash management, and product innovation to weather market volatility.

• The USGIF performance fee is being phased out and will cease by Q4 FY2025.

• Management expects continued volatility in net investment income due to market fluctuations and transaction timing.