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Cemtrex Surges 40% After Hours Despite Going-Concern Warning

MarketDash Editorial Team
3 hours ago
Cemtrex shares jumped over 40% in after-hours trading Monday as investors focused on the company's return to operating profitability, overlooking earlier concerns about its ability to continue as a going concern amid mounting debt pressures.

Cemtrex Inc. (CETX) had quite the rollercoaster Monday. The stock dropped 7.5% during regular trading after the company disclosed "substantial doubt" about its ability to continue operating. Then after the bell, shares rocketed over 40% to $3.01 as investors decided to focus on the good news instead.

A Return to Profitability (Sort Of)

For the fiscal year ended September 30, Cemtrex reported revenue growth to $76.5 million from $66.9 million the previous year. The security segment delivered a 20% revenue increase to $38.4 million, while industrial services revenue climbed 9% to $38 million.

Here's where things get interesting. The company recorded a net loss of $28.3 million, largely driven by warrant-related charges including a $15.1 million loss on the exercise of warrant liabilities. But if you look at operating income—a clearer measure of actual business performance—the picture brightens considerably. The company posted operating income of $500,000 for the year, compared to an operating loss of $5.3 million a year earlier.

"Fiscal 2025 marked a major operating inflection for Cemtrex," CEO Saagar Govil said in a statement. "Importantly, these results were achieved while we were actively investing in capital markets initiatives to restore liquidity and flexibility. As certain of those activities and other expenses are not expected to recur, we expect further improvement in core operating performance going forward."

The Debt Problem Isn't Going Away

Now for the sobering part. Cemtrex had $6.35 million in cash, cash equivalents, and restricted cash as of September 30, against total debt of $13.5 million. More concerning, the company faces over $12.1 million in debt obligations coming due in the next fiscal year. That math doesn't add up without some creative maneuvering.

Management noted they've historically tackled short-term liabilities by issuing common stock, which likely explains some of that brutal 95.51% decline over the past year. Interestingly, the company also invested about $1 million in Solana tokens during fiscal 2025, with fair-value changes reflected in net income.

The company says it has two acquisitions expected to close soon, which could potentially provide some financial breathing room. Whether that's enough to address the going-concern warning remains to be seen.

CETX Price Action: Shares closed down 7.5% at $2.11 Monday, then surged 42.65% to $3.01 in after-hours trading. Despite the after-hours rally, the stock has plummeted 95.51% over the past year. Earlier this year, Cemtrex reached a 52-week high of $55.50—current levels represent just 1.7% of that peak.

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Cemtrex Surges 40% After Hours Despite Going-Concern Warning

MarketDash Editorial Team
3 hours ago
Cemtrex shares jumped over 40% in after-hours trading Monday as investors focused on the company's return to operating profitability, overlooking earlier concerns about its ability to continue as a going concern amid mounting debt pressures.

Cemtrex Inc. (CETX) had quite the rollercoaster Monday. The stock dropped 7.5% during regular trading after the company disclosed "substantial doubt" about its ability to continue operating. Then after the bell, shares rocketed over 40% to $3.01 as investors decided to focus on the good news instead.

A Return to Profitability (Sort Of)

For the fiscal year ended September 30, Cemtrex reported revenue growth to $76.5 million from $66.9 million the previous year. The security segment delivered a 20% revenue increase to $38.4 million, while industrial services revenue climbed 9% to $38 million.

Here's where things get interesting. The company recorded a net loss of $28.3 million, largely driven by warrant-related charges including a $15.1 million loss on the exercise of warrant liabilities. But if you look at operating income—a clearer measure of actual business performance—the picture brightens considerably. The company posted operating income of $500,000 for the year, compared to an operating loss of $5.3 million a year earlier.

"Fiscal 2025 marked a major operating inflection for Cemtrex," CEO Saagar Govil said in a statement. "Importantly, these results were achieved while we were actively investing in capital markets initiatives to restore liquidity and flexibility. As certain of those activities and other expenses are not expected to recur, we expect further improvement in core operating performance going forward."

The Debt Problem Isn't Going Away

Now for the sobering part. Cemtrex had $6.35 million in cash, cash equivalents, and restricted cash as of September 30, against total debt of $13.5 million. More concerning, the company faces over $12.1 million in debt obligations coming due in the next fiscal year. That math doesn't add up without some creative maneuvering.

Management noted they've historically tackled short-term liabilities by issuing common stock, which likely explains some of that brutal 95.51% decline over the past year. Interestingly, the company also invested about $1 million in Solana tokens during fiscal 2025, with fair-value changes reflected in net income.

The company says it has two acquisitions expected to close soon, which could potentially provide some financial breathing room. Whether that's enough to address the going-concern warning remains to be seen.

CETX Price Action: Shares closed down 7.5% at $2.11 Monday, then surged 42.65% to $3.01 in after-hours trading. Despite the after-hours rally, the stock has plummeted 95.51% over the past year. Earlier this year, Cemtrex reached a 52-week high of $55.50—current levels represent just 1.7% of that peak.

    Cemtrex Surges 40% After Hours Despite Going-Concern Warning - MarketDash News