zSpace (NASDAQ:ZSPC) Announces Quarterly Earnings Results

zSpace (NASDAQ:ZSPC) released its quarterly earnings results on Monday. The company reported ($0.26) earnings per share for the quarter, missing analysts’ consensus estimates of ($0.16) by ($0.10), FiscalAI reports. The firm had revenue of $4.85 million during the quarter, compared to the consensus estimate 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 Stock Performance

NASDAQ ZSPC traded down $0.01 on Monday, reaching $0.11. 1,950,298 shares of the stock traded hands, compared to its average volume of 1,285,807. zSpace has a 12 month low of $0.10 and a 12 month high of $10.66. The company has a market cap of $3.77 million, a price-to-earnings ratio of -0.14 and a beta of -0.25. The company has a fifty day moving average price of $0.30 and a 200-day moving average price of $0.64.

Institutional Trading of zSpace

A number of hedge funds have recently added to or reduced their stakes in the business. AQR Capital Management LLC bought a new position in zSpace during the 4th quarter worth about $25,000. Millennium Management LLC purchased a new stake in shares of zSpace in the 3rd quarter worth approximately $25,000. HRT Financial LP purchased a new stake in shares of zSpace in the 4th quarter worth approximately $27,000. XTX Topco Ltd bought a new position in shares of zSpace during the fourth quarter valued at approximately $30,000. Finally, Geode Capital Management LLC boosted its stake in shares of zSpace by 134.0% during the fourth quarter. Geode Capital Management LLC now owns 119,014 shares of the company’s stock valued at $56,000 after purchasing an additional 68,150 shares in the last quarter.

Wall Street Analyst Weigh In

Separately, Weiss Ratings reiterated a “sell (e+)” rating on shares of zSpace in a report on Wednesday, January 21st. Two investment analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the company’s stock. Based on data from MarketBeat.com, zSpace currently has an average rating of “Hold” and a consensus target price of $6.00.

About zSpace

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.