Symbotic (SYM) Q3 Revenue Jumps 26%

Symbotic (SYM -0.92%), a warehouse automation technology provider, delivered its third quarter fiscal 2025 earnings on August 6, 2025. Symbotic achieved GAAP revenue of $592 million for Q3 FY2025, topping analyst GAAP revenue estimates of $533.3 million by over 11%. However, it reported a net loss per share of $(0.05) (GAAP), compared to the consensus estimate of $0.05 per share, as spending on growth and integration activities continued. Adjusted EBITDA (non-GAAP) was $45 million, compared to $3 million in Q3 FY2024. Overall, while top-line growth and operating results were robust, net losses and cash outflows remained points to monitor.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q2 2025 earnings report.

Business Overview and Key Success Factors

Symbotic develops and deploys automated warehouse solutions, blending high-speed autonomous robots, modular storage systems, and artificial intelligence (AI) software. Its technology allows retailers and distributors to automate the storage, retrieval, and movement of goods, with the aim of boosting warehouse efficiency and accuracy.

The company’s focus areas include ongoing innovation in robotics and AI, expanding its customer partnerships, and growing its presence in new market segments. Its portfolio includes more than 700 patents. Sustained momentum relies on the strength of relationships with customers like Walmart and C&S Wholesale Grocers, and the ability to respond to rising demand for automated distribution driven by e-commerce and labor shortages.

Quarter Highlights: Growth, Margins, and Product Innovation

During Q3 FY2025, Symbotic reported growth across its main business lines compared to the prior year. Revenue (GAAP) increased 26% year-over-year, led by its systems segment, which captured $559.1 million compared to $450.6 million in Q3 FY2024. Software maintenance and support revenue (GAAP) jumped to $8.1 million, more than doubling from the previous year. Operation services revenue (GAAP) was $24.9 million, compared to $16.2 million in Q3 FY2024.

Gross profit (GAAP) was $107.6 million, compared to $55.0 million in Q3 FY2024. Gross margin (GAAP) improved to 18.2%, up from 11.7% in Q3 FY2024. The improvement was driven by a favorable project mix, greater recurring revenue from software, and progress in installation efficiency during Q2 FY2025. Adjusted gross profit margin reached 21.5% (non-GAAP). Management noted Q2 FY2025 benefitted from higher training revenue linked to system completions, which was a one-time boost, but described overall improvements as sustainable due to better project execution.

Adjusted EBITDA reached $45 million, a substantial jump from $3 million in Q3 FY2024, far surpassing the company's prior guidance. On the other hand, net loss (GAAP) was $32 million, slightly wider than last year, as higher operating expenses reflected investments in research and development (R&D) and costs tied to integrating the Walmart Advanced Systems and Robotics (ASR) acquisition. GAAP R&D spending was $52.1 million, compared to $44.7 million in Q3 FY2024. Selling, general, and administrative (SG&A) expenses were $75.7 million (GAAP). Management expects SG&A to decrease by $4-5 million as integration activity winds down.

Symbotic unveiled its next-generation storage structure. The company continued to integrate Walmart’s ASR business, increasing its capabilities in solutions for micro-fulfillment (small, localized warehouses), and for both ambient and perishable goods. This integration is expected to accelerate entry into the perishable and frozen goods automation markets. The company now offers three main product types: large automated warehouse systems, modular "brake pack" systems for smaller install footprints, and in-store micro-fulfillment systems.

Strategically, Symbotic emphasized expansion of its GreenBox joint venture, a “warehouse-as-a-service” business model aimed at enabling customers to use automated distribution without large upfront investment. The GreenBox pipeline now includes sites on both U.S. coasts, with C&S as the first third-party customer. Discussion is ongoing with new potential tenants.

The company’s backlog, representing signed but not yet completed orders, was approximately $22.4 billion as of Q4 FY2024. Most of this comes from major partners such as Walmart and GreenBox. Software gross margins exceeded 65% in Q2 FY2025, reflecting high profitability within this line as scale grows. Symbotic also maintains broad contract protections that allow it to pass on tariff-related cost increases to customers, lowering exposure to margin risk from import duties.

On the balance sheet, cash and equivalents were $778 million at quarter end, down $177 million due to operating and investing outflows. Free cash flow (non-GAAP) was negative $153.2 million, a notable swing from positive $33.2 million in Q3 FY2024, reflecting the variability driven by new system deployment agreements and timing of receipt of cash from customers. Total assets (GAAP) stood at $1.83 billion and equity (GAAP) at $443 million, providing a solid base, although the cash burn will need to be closely watched in coming quarters.

Looking Ahead: Guidance and Watch Points

Management provided guidance for Q4 FY2025, forecasting revenue between $590 million and $610 million, and adjusted EBITDA (non-GAAP) between $45 million and $49 million. This outlook suggests stable revenue and profit margins compared to the current quarter, as guidance calls for revenue of $590 million to $610 million and adjusted EBITDA of $45 million to $49 million, compared to revenue of $592 million and adjusted EBITDA of $45 million in the prior quarter. Executives noted that rollout of the new storage system could temporarily impact revenue in the near term, as disclosed in recent management commentary, but stated the backlog and long-term prospects were not affected. The guidance does not include potential effects from new tariffs, but contract terms generally allow increased costs to be passed through to customers.

Looking forward, investors should monitor the pace of new customer signings. As the company broadens its product range and target markets, execution and cost management will remain in focus.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.