Daily Journal Corporation Announces Financial Results for the Nine Months ended June 30, 2025

Rhea-AI Summary

Daily Journal Corporation (NASDAQ:DJCO) reported strong financial results for the nine months ended June 30, 2025, with consolidated revenues reaching $59.3 million, up from $50.1 million in the prior year period. The company's Journal Technologies segment showed significant growth, with pretax income increasing by $3.9 million to $4.7 million.

The company's investment portfolio remained robust, holding marketable securities valued at $443 million, including net pretax unrealized gains of $303.9 million. Consolidated net income rose to $70 million ($50.81 per share), compared to $51.4 million ($37.32 per share) in the prior year period. The effective tax rate for the period was 25.9%.

Positive

• Consolidated revenues increased by $9.2 million to $59.3 million
• Journal Technologies' pretax income grew significantly by $3.9 million to $4.7 million
• Marketable securities portfolio valued at $443 million with $303.9 million in unrealized gains
• Net income increased 36.2% to $70 million ($50.81 per share)
• Journal Technologies showed strong growth in license fees, maintenance fees, and consulting revenues

Negative

• Traditional Business segment pretax income decreased by $1.4 million to $237,000
• Operating expenses increased by $4.4 million in Journal Technologies segment
• Significant deferred tax liability of $79.3 million on appreciated securities

Insights

Financial Analyst

DJCO reports strong financial growth with 18.4% revenue increase and 36.2% jump in net income, primarily driven by Journal Technologies' performance.

Daily Journal Corporation's financial results for the nine months ending June 30, 2025 demonstrate robust growth across key metrics. The company posted consolidated revenues of $59.3 million, an impressive 18.4% increase from the $50.1 million reported in the same period last year. This growth was primarily fueled by Journal Technologies, which saw substantial increases in license and maintenance fees ($2.4 million), consulting fees ($1.9 million), and public service fees ($4.0 million).

The company's segment performance reveals a notable contrast between its two business units. Journal Technologies showed exceptional improvement, with pretax income surging by $3.9 million to reach $4.7 million - a 530% increase year-over-year. This growth came despite higher operating expenses of $4.4 million related to increased personnel costs, contractor services, and third-party hosting fees. Meanwhile, the Traditional Business segment experienced a 85% decline in pretax income to $237,000, primarily due to a $2.3 million increase in expenses related to long-term supplemental compensation accruals.

DJCO's investment portfolio remains substantial at $443 million, including $303.9 million in unrealized gains. The portfolio generated $6.2 million in dividends and interest income, a modest increase of $301,000 from the prior year. The company recorded $84.3 million in net unrealized gains on marketable securities, significantly contributing to the $89.5 million in non-operating income.

Overall, consolidated pretax income grew 38.4% to $94.4 million, while net income increased 36.2% to $70.0 million, resulting in earnings per share of $50.81 compared to $37.32 in the previous year. The effective tax rate was 25.9%. These results highlight DJCO's strong operational improvement in its technology segment alongside continued benefits from its substantial investment portfolio.

LOS ANGELES, Aug. 14, 2025 (GLOBE NEWSWIRE) -- During the nine months ended June 30, 2025, Daily Journal Corporation (NASDAQ:DJCO) had consolidated revenues of $59,286,000 as compared to $50,058,000 in the prior year period. This increase of $9,228,000 was primarily from increases in (i) Journal Technologies’ license and maintenance fees of $2,418,000, consulting fees of $1,853,000, and other public service fees of $4,031,000 and (ii) the Traditional Business’ advertising revenues of $703,000 and advertising service fees and other of $310,000.

The Traditional Business’ pretax income decreased by $1,364,000 to $237,000 from $1,601,000. This decrease primarily resulted from increased expenses of $2,290,000 mainly due to an increase in the long-term supplemental compensation accrual, partially offset by increased revenues of $926,000. Journal Technologies’ business segment pretax income increased by $3,947,000 to $4,692,000 from $745,000 in the prior fiscal year period primarily resulting from increased operating revenues of $8,302,000, which were partially offset by increased operating expenses of $4,355,000 mainly from (i) increased personnel costs because of annual salary adjustments, (ii) additional contractor services and the hiring of additional staff members to strengthen operational efficiencies, conduct product development and address technical debt, and bolster teams working on the Company’s installation projects, and (iii) increased third-party hosting fees which were billed to clients.

At June 30, 2025, the Company held marketable securities valued at $443,011,000, including net pretax unrealized gains of $303,917,000, and accrued a deferred tax liability of $79,260,000 for estimated income taxes due only upon the sales of the net appreciated securities.

The Company’s non-operating income, net of expenses, increased by $23,618,000 to $89,467,000 from $65,849,000 in the prior fiscal year period primarily because of the recording of net unrealized gains on marketable securities of $84,320,000 as compared with realized and unrealized gains on marketable securities of $62,472,000 in the prior fiscal year period. There was also an increase in dividends and interest income of $301,000 to $6,158,000 from $5,857,000.

Consolidated pretax income was $94,396,000, as compared to $68,195,000 in the prior fiscal year period. There was consolidated net income of $69,986,000 ($50.81 per share) for the nine months ended June 30, 2025, as compared with $51,385,000 ($37.32 per share) in the prior fiscal year period.

For the nine months ended June 30, 2025, the Company recorded an income tax provision of $24,410,000 on the pretax income of $94,396,000.  The income tax provision consisted of tax provisions of $21,990,000 on the unrealized gains on marketable securities, $70,000 on income from foreign operations, $2,530,000 on income from US operations and dividend income and $170,000 for the effect of a change in state apportionment on the beginning of the year’s deferred tax liability, partially offset by a tax benefit of $350,000 for the dividends received deduction and other permanent book and tax differences.   Consequently, the overall effective tax rate for the nine months ended June 30, 2025 was 25.9%, after including the anticipated taxes on the unrealized gains on marketable securities.

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain statements contained in this press release are “forward-looking” statements that involve risks and uncertainties that may cause actual future events or results to differ materially from those described in the forward-looking statements. Words such as “expects,” “intends,” “anticipates,” “should,” “believes,” “will,” “plans,” “estimates,” “may,” variations of such words and similar expressions are intended to identify such forward-looking statements. We disclaim any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments, or otherwise. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in documents we file with the Securities and Exchange Commission.

# # #

Contact: Tu To (213) 229-5436

FAQ

What were Daily Journal Corporation's (DJCO) earnings per share for the nine months ended June 30, 2025?

DJCO reported earnings of $50.81 per share for the nine-month period, compared to $37.32 per share in the prior year period.

How much revenue did Daily Journal Corporation generate in the first nine months of 2025?

The company generated consolidated revenues of $59,286,000, an increase of $9,228,000 from the prior year period of $50,058,000.

What is the value of Daily Journal Corporation's marketable securities portfolio as of June 30, 2025?

DJCO held marketable securities valued at $443,011,000, including net pretax unrealized gains of $303,917,000.

How did Journal Technologies' business segment perform in the nine months ended June 30, 2025?

Journal Technologies' pretax income increased by $3,947,000 to $4,692,000 from $745,000, driven by increased operating revenues of $8,302,000, partially offset by higher operating expenses.

What was Daily Journal Corporation's effective tax rate for the nine months ended June 30, 2025?

The company's overall effective tax rate was 25.9%, which includes anticipated taxes on unrealized gains on marketable securities.