How MLGO (MicroAlgo) Makes Money in 2025: A Deep-Dive With Income Statement

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Understanding how a technology company like MLGO Income Statement Overview makes money is essential for investors and anyone interested in the business of digital solutions. In this post, we break down MLGO'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 MLGO Overview

MLGO Income Statement Overview operates as a digital solutions provider, offering technology-driven products and services to enterprise clients. Revenue comes primarily from digital platform subscriptions and technology consulting services. The company focuses on scalable SaaS offerings, with a business model centered on recurring revenue and high-value enterprise contracts.

Revenue Breakdown

• Total Revenue (Q2 2025): $13.1M (−34.3% YoY)
  • Revenue: $13.1M (100% of total)
  • Growth is powered by enterprise digital transformation projects and recurring SaaS subscriptions, though overall revenue declined YoY due to market headwinds.

Gross Profit and Margins

• Gross Profit: $3.6M (27.4% gross margin)
  • Cost of Revenue: $9.5M (−31.8% YoY)
  • MLGO maintains moderate margins due to its scalable digital business model, though cost pressures remain significant.
• Most costs come from technology infrastructure, platform maintenance, and service delivery.

Operating Income and Expenses

• Operating Income: $0.55M (+197.5% YoY, 4.2% margin)
• Operating Expenses: $3.05M (−47.8% YoY)
  • R&D: $2.34M (−55.2% YoY, 17.8% of revenue) — Focused on platform enhancements, AI integration, and cybersecurity features.
  • SG&A: $0.71M (+15.4% YoY, 5.4% of revenue) — Includes sales, marketing, and administrative costs to support client acquisition and retention.
  • MLGO continues to prioritize innovation while maintaining efficiency and controlling costs.

Net Income

• Pre-Tax Income: $2.37M (+49.1% YoY, 18.1% margin)
• Income Tax: $0.16M (6.7% effective tax rate)
• Net Income: $1.85M (+65.2% YoY, 14.1% net margin)
• MLGO converts a significant portion of sales into profit due to its scalable SaaS model and disciplined cost management.

What Drives MLGO's Money Machine?

• Enterprise SaaS subscriptions: Over 80% of revenue is generated from recurring software subscriptions and digital platform fees.
• Client retention rate: Maintains a high retention rate above 90%, supporting stable recurring revenue.
• R&D investment: $2.34M invested in Q2 2025, driving innovation in AI and cybersecurity.
• Expansion into AI-powered analytics: Early-stage investments in new analytics modules, not yet profitable but positioned for future growth.

Visualizing MLGO'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 R&D) taking the largest chunk.
• Even after significant R&D investment, 14.1% of revenue drops to the bottom line.

Key Takeaways

• MLGO's money comes overwhelmingly from enterprise SaaS subscriptions and digital platform services.
• High gross and net margins illustrate the power of MLGO's scalable digital business model.
• Heavy investment in R&D, balanced by efficiency in operating costs.
• Ongoing growth is driven by innovation in AI and cybersecurity, despite short-term revenue declines.

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FAQ About MLGO's Income Statement

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

MLGO generates over 80% of its revenue from enterprise SaaS subscriptions and digital platform fees. Consulting and technology services provide additional, but less significant, revenue streams.

2. How profitable is MLGO in Q2 2025?

MLGO reported net income of $1.85M in Q2 2025, with a net margin of approximately 14.1%, reflecting strong profitability driven by a scalable SaaS model and disciplined cost control.

3. What are the largest expense categories for MLGO?

The biggest expenses on MLGO's income statement are operating expenses, particularly Research & Development (R&D) at $2.34M in Q2 2025, as MLGO prioritizes platform innovation and AI integration. SG&A costs totaled $0.71M, supporting sales and administrative functions.

4. Why does the AI analytics segment operate at a loss?

The AI analytics segment, despite generating early-stage revenue, posted an operating loss in Q2 2025. This is because MLGO 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 MLGO's effective tax rate compare to previous years?

MLGO's effective tax rate in Q2 2025 was 6.7%, lower than previous years. This low rate is primarily due to tax benefits from R&D credits and international structuring.