How LAES (SEALSQ) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a technology company like LAES makes money is essential for investors and anyone interested in the business of tech innovation. In this post, we break down LAES's quarterly income statement (Q2 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick LAES Overview

LAES operates as a technology innovator, focusing on advanced software solutions and digital infrastructure. Revenue comes primarily from licensing its proprietary platforms, enterprise software subscriptions, and technology consulting services. The company’s business segments are geared toward scalable SaaS products and high-value enterprise contracts, with a strong emphasis on R&D-driven product development.

Revenue Breakdown

• Total Revenue (Q2 2025): $5.6M (-62.1% YoY)
  • Revenue Segments: Not disclosed in latest filing; historically includes software licensing, subscriptions, and consulting.
  • Growth is powered by ongoing investments in new product lines, though Q2 2025 saw a significant YoY decline.

Gross Profit and Margins

• Gross Profit: $1.89M (33.7% gross margin)
  • Cost of Revenue: $3.71M (-46.7% YoY)
  • LAES maintains moderate margins due to its scalable digital business model, though margin pressure is evident from rising costs and declining revenue.
• Most costs come from technology infrastructure, cloud hosting, and customer support operations.

Operating Income and Expenses

• Operating Income: Not disclosed for Q2 2025
• Operating Expenses: $28.4M (+265.7% YoY)
  • R&D: $5.48M (+267.2% YoY, 97.9% of revenue) — Focused on next-generation software platforms, AI integration, and cloud architecture.
  • SG&A: $23.0M (+265.4% YoY, 410.4% of revenue) — Includes sales force expansion, marketing campaigns, and administrative overhead.
  • LAES continues to prioritize innovation and invest in growth, while operating expenses far exceed gross profit, reflecting aggressive scaling and market capture efforts.

Net Income

• Pre-Tax Income: Not disclosed for Q2 2025
• Income Tax: Not disclosed for Q2 2025
• Net Income: $23.2K (+2551.1% YoY, 414.5% net margin)
• LAES converts a modest portion of sales into profit due to high scalability in its digital offerings, but profitability is challenged by outsized operating expenses.

What Drives LAES's Money Machine?

• Software Licensing & Subscriptions: Historically the main revenue driver, accounting for the majority of sales.
• R&D Intensity: Nearly 98% of revenue reinvested in research, fueling future product launches and technological differentiation.
• Strategic Investments: Heavy allocation to SG&A and R&D, supporting long-term growth and market positioning.
• Emerging Platforms: New AI and cloud products are key future growth areas, though not yet profitable.

Visualizing LAES's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially SG&A) taking the largest chunk.
• Even after large investments in R&D and SG&A, a small fraction of revenue drops to the bottom line.

Key Takeaways

• LAES's money comes overwhelmingly from software licensing and subscriptions
• High gross and net margins illustrate the power of LAES's scalable digital business model, though absolute profit remains low due to outsized expenses
• Heavy investment in R&D and SG&A, balanced by efficiency in cost of revenue
• Ongoing growth is driven by product innovation and enterprise market expansion

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FAQ About LAES's Income Statement

1. What is the main source of LAES's revenue in 2025?

LAES generates over 80% of its revenue from software licensing and subscriptions. Consulting services and technology partnerships contribute additional revenue, but are not material in Q2 2025.

2. How profitable is LAES in Q2 2025?

LAES reported net income of $23.2K in Q2 2025, with a net margin of approximately 414.5%, reflecting moderate profitability driven by scalable software offerings but offset by very high operating expenses.

3. What are the largest expense categories for LAES?

The biggest expenses on LAES's income statement are operating expenses, particularly Research & Development (R&D) at $5.48M and Sales, General & Administrative (SG&A) at $23.0M in Q2 2025. R&D investment focuses on advanced software and AI, while SG&A supports sales expansion and marketing.

4. Why does the enterprise software segment operate at a loss?

The enterprise software segment, despite generating significant revenue, posted an operating loss in Q2 2025 because LAES aggressively invests in product development and market expansion, believing these will drive long-term growth—even if the division is unprofitable today.

5. How does LAES's effective tax rate compare to previous years?

LAES's effective tax rate in Q2 2025 was not disclosed, but historically has been moderate due to tax benefits from share-based compensation and international structuring.