Zapata Quantum Inc

Zapata Quantum operates with a negative equity position of -$21.08 million and a debt-to-equity ratio of -0.22, indicating a capital structure heavily reliant on liabilities rather than equity. The company holds $7.25 million in cash and equivalents, but its operating cash flow is negative at -$2.15 million, and free cash flow is -$22.29 million, signaling significant liquidity constraints. The current ratio of 0.41 further underscores the company's limited ability to meet short-term obligations with current assets.

Profitability metrics reveal a stark contrast to industry norms. The company reported a net loss of $22.32 million and an operating loss of $14.85 million, with a return on assets of -2.26% and a return on equity of 105.88%. The latter is an artifact of negative equity and does not reflect true profitability. These figures fall well below the median performance of the Software industry, where positive returns and stable operating margins are typically expected.

Zapata Quantum's revenue concentration is not disclosed in the available data, but the absence of segment or geographic breakdowns suggests a lack of diversification. The company's exposure to specific markets or customer bases is unclear, which could pose a concentration risk if not managed.

The company's growth trajectory is uncertain. With a revenue of $1.22 billion, Zapata Quantum is a relatively small player in the Software industry. The outlook for the current fiscal year does not provide specific numeric deltas, but the company's negative operating and net income suggest a challenging path to growth. The absence of clear guidance on future revenue expansion or margin improvement raises concerns about its long-term viability.

Risk factors include low liquidity and the potential for dilution, though the latter is currently assessed as low. The company has not issued any recent dilutive events, and no immediate filing-based liquidity or dilution flags were detected. However, the negative free cash flow and high debt levels could necessitate future capital raises, which may involve equity dilution.

Recent events include the latest financial filing (market data), which provides the most recent snapshot of the company's financial health. No recent earnings call transcripts or other material events are available in the provided data, limiting insight into management's strategic direction or operational updates.

Zapata reported a net income of $9.3 million in FY0, marking a significant turnaround from the $38.1 million loss in FY-1.

The company generated positive free cash flow of $9.3 million in FY0, reversing the substantial cash burn seen in prior fiscal years.

Zapata's return on equity of 1.06% ranks as best-in-class compared to the Diversified Software cohort median of 0.02%.

With a debt-to-equity ratio of -0.22, Zapata demonstrates best-in-class leverage metrics relative to its software peer group.

Dilution risk is assessed as low, suggesting limited immediate pressure on shareholder equity from new share issuance.

Zapata faces high credit risk, indicating significant concerns regarding its ability to meet financial obligations despite recent profitability.

The current ratio of 0.09 suggests severe liquidity constraints, as current assets cover only a fraction of current liabilities.

Operating margin of -12.19% places Zapata in the bottom quartile of the Diversified Software cohort, signaling poor operational efficiency.

Cash conversion of 0.10 is below the cohort median of 0.82, indicating weaker ability to translate earnings into cash.

Revenue $0.00; Operating income +242,9% YoY.

• ▍Revenue $0.00
• ▍Operating income +242,9% YoY
• ▍Net income +211,1% YoY