zSpace (NASDAQ:ZSPC) Announces Earnings Results, Misses Estimates By $0.10 EPS

zSpace (NASDAQ:ZSPC) issued its quarterly earnings results on Monday. The company reported ($0.26) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of ($0.16) by ($0.10), reports. The business had revenue of $4.85 million during the quarter, compared to analyst estimates of $6.20 million.

Here are the key takeaways from zSpace’s conference call:

• Top-line weakness and thin liquidity. Full-year revenue was $27.9M (down 27%) and Q4 revenue was $4.8M (down 43%) with bookings down and only about $1M in cash and restricted cash at year-end, citing tariffs, K‑12 funding freezes, the U.S. government shutdown and delayed international orders as drivers.
• Meaningful gross margin expansion driven by software mix. 2025 gross margin rose to 47.6% (up 6.7 percentage points) and Q4 margin reached 49.1%, with software and services making up 57% of Q4 revenue and product refreshes lowering hardware BOMs.
• Significant cost restructuring to target breakeven. Management cut roughly half of FTEs, trimmed the board and expects an OpEx run‑rate near $19M (ex‑stock comp), saying these moves plus margin improvements could bring adjusted EBITDA close to breakeven in 2026 if revenues are similar to 2025.
• Product and customer momentum supports future growth. zStylus One (AI‑enabled, lower BOM), AI language support, the award for Career Explorer and several six‑figure district wins (Atlanta, Mayfair, Greater Altoona) were highlighted as catalysts for broader adoption and upgrades.

zSpace Trading Up 0.4%

ZSPC stock opened at $0.11 on Wednesday. The business’s 50-day moving average is $0.29 and its 200 day moving average is $0.62. zSpace has a 12-month low of $0.10 and a 12-month high of $10.66. The stock has a market cap of $3.78 million, a price-to-earnings ratio of -0.11 and a beta of -0.25.

Institutional Trading of zSpace

Several large investors have recently added to or reduced their stakes in ZSPC. XTX Topco Ltd acquired a new stake in zSpace during the second quarter worth $39,000. Millennium Management LLC acquired a new position in shares of zSpace in the 3rd quarter valued at $25,000. Geode Capital Management LLC grew its holdings in shares of zSpace by 134.0% during the 4th quarter. Geode Capital Management LLC now owns 119,014 shares of the company’s stock worth $56,000 after purchasing an additional 68,150 shares during the period. HRT Financial LP purchased a new position in shares of zSpace during the 4th quarter worth $27,000. Finally, Jane Street Group LLC acquired a new stake in shares of zSpace during the 4th quarter worth about $57,000.

Analysts Set New Price Targets

Separately, Weiss Ratings restated a “sell (e+)” rating on shares of zSpace in a report on Wednesday, January 21st. Two analysts have rated the stock with a Buy rating, one has given a Hold rating and one has given a Sell rating to the company. According to MarketBeat, the company currently has an average rating of “Hold” and an average price target of $4.00.

zSpace Company Profile

zSpace, Inc is a technology company that develops augmented and virtual reality solutions designed to deliver immersive learning experiences. Headquartered in Pleasanton, California, the company focuses on integrating advanced 3D visualization hardware and interactive software to support science, technology, engineering and mathematics (STEM) education, as well as professional training applications.

The company’s flagship offering, the zSpace AR/VR system, combines a stereoscopic display, stylus-based interaction and head-tracking technology to enable users to manipulate and explore three-dimensional models.