Recon Technology, Ltd Reports Financial Year Results for Fiscal Year 2025

Rhea-AI Summary

Recon Technology (NASDAQ: RCON) reported fiscal 2025 results for the year ended June 30, 2025: revenue RMB66.3M (down 3.7% vs. 2024), gross profit RMB15.2M and gross margin 23.0% (down from 30.3%). Net loss narrowed to RMB43.7M from RMB51.4M. Management highlighted client diversification into non-oilfield and overseas oilfield customers and started construction of a chemical recycling factory on April 28, 2025, expected complete by end of 2025. Cash was RMB98.9M and short-term investment was RMB3.6M as of June 30, 2025.

Positive

• Automation revenue +27.1% (RMB increase of RMB7.3M)
• Automation gross profit +84.9% year-over-year
• Net loss improved by RMB7.7M (15.0%) year-over-year
• G&A expense reduced 22.1% (RMB14.2M)
• Chemical recycling factory construction started April 28, 2025

Negative

• Total revenue down 3.7% to RMB66.3M
• Gross margin fell from 30.3% to 23.0% (~730 bps)
• Oilfield environmental protection revenue down 41.4% (RMB7.3M)
• Oilfield environmental protection gross profit down 79.1%
• Short-term investments fell from RMB88.1M to RMB3.6M

Insights

Corporate Finance Analyst

Mixed FY2025: small revenue decline, sharply lower gross margin, but a smaller net loss and cost reductions.

Recon Technology, Ltd reported total revenue of RMB66.3 million for the year ended June 30, 2025, down 3.7% year-over-year, gross profit of RMB15.2 million with gross margin at 23.0% (down from 30.3%), and a net loss of RMB43.7 million which improved versus the prior year loss. Operating expense reductions (notably G&A) and lower warrant fair-value swings materially reduced operating losses despite weaker core margins.

Key dependencies and risks include continued pressure from oilfield customers (reduced budgets and price concessions) and the pending renewal of hazardous-waste qualifications that directly affected oilfield environmental revenue. The chemical recycling factory is under construction and has not generated revenue; management expects completion by end of 2025, so near-term revenue lift from that project remains unearned and contingent on successful start-up and qualification outcomes.

Watchables: completion and operational start of the chemical recycling factory by end of 2025, renewal of the Gansu BHD hazardous-waste permit, and any sustained recovery in oilfield customer spending. Short-term (next 3–6 months) focus should be on credential renewals and factory commissioning; medium-term (through fiscal 2026) focus should be on whether the new overseas oilfield contracts and chemical recycling output translate into margin recovery.

BEIJING, Oct. 14, 2025 /PRNewswire/ -- Recon Technology, Ltd (NASDAQ: RCON) ("Recon" or the "Company"), a China-based independent solutions integrator in the oilfield service and environmental protection, electric power and coal chemical industries, today announced its financial results for fiscal year 2025.

Fiscal Year Ended June 30, 2025 Financial Highlights:

• Total revenue decrease by approximately RMB2.5 million ($0.4 million) or3.7% to RMB66.3 million ($9.3 million) for the year ended June 30, 2025 from RMB68.8 million ($9.6 million) for the same period in 2024.
• Gross profit decreased to RMB15.2 million ($2.1 million) for the year ended June 30, 2025, from RMB20.9 million ($2.9 million) for the same period in 2024.
• Gross margin decreased to 23.0% for the year ended June 30, 2025 from 30.3% for the same period in 2024.
• Net loss was RMB44.2 million ($6.2 million) for the year ended June 30, 2025, a decrease of RMB7.2 million ($1.0 million) from net loss of RMB51.4 million ($7.2 million) for the same period of 2024.

		For the Years Ended
		June 30,
		2025			2024			Increase /(Decrease)			Percentage Change
(in RMB millions, except earnings per share;     differences due to rounding)
Revenue		RMB	66.3		RMB	68.8		RMB	(2.5)		(3.7)	%
Gross profit			15.2			20.9			(5.7)		(27.0)	%
Gross margin			23.0	%		30.3	%		(24.2)	%	—
Net loss			(43.7)			(51.4)			(7.7)		(15.0)	%
Net loss per share – Basic and diluted			(4.68)			(9.88)			5.2		(52.6)	%

Management Commentary

Mr. Shenping Yin, Founder and CEO of Recon said, "During the 2025 financial year, our primary clients, domestic oil companies, have experienced declining performance due to the impact of oil price fluctuations. Consequently, they have adopted more cautious and cost-conscious approaches to capital expenditures and expense management. This has had a negative impact on our profitability. Fortunately, we have secured several new clients outside of the oilfield industry and expanded our order book with offshore oilfield customers. These developments have stabilized our business operations. During the 2025 financial year, we also successfully expanded our overseas oilfield client base, which will significantly contribute to our business in the new financial year.

At the same time, we are pressing ahead with construction of our Chemical Circular Factory. For the 2025 fiscal year, we have completed all pre-approval procedures required by local authorities, obtained the construction project planning permit, and officially started the construction work on April 28, 2025. It is anticipated that the project will be fully completed by the end of 2025. We believe that the plastic chemical recycling business will enhance the company's operations significantly in the 2026 financial year."

Fiscal Year Ended 202 5  Financial Results:

Revenue

Total revenues for the year ended June 30, 2025 were approximately RMB66.3 million ($9.3 million), a decrease of approximately RMB2.5 million ($0.4 million) or3.7% from RMB68.8 million ($9.6 million) for the same period in 2024.

• Revenue from automation product and software increased by RMB7.3 million ($1.0 million) or 27.1%. The increase in revenue was primarily driven by the company's enhanced sales activities and successful expansion into markets beyond oilfields, partially offset by declining sales to certain oilfield clients.
  
  
• Revenue from equipment and accessories decreased by RMB2.0 million ($0.3 million) or 10.0%. The main reason for the decline in revenue is that oilfield customers, in order to safeguard their earnings, have strictly controlled their extraction budgets and implemented low-cost operational strategies.
  
  
• Revenue from oilfield environmental protection decreased by RMB7.3 million ($1.0 million) or 41.4% primarily due to the expiration of Gansu BHD's hazardous waste operation permit. As a result, no revenue was recorded. The company is currently engaged in the active application process for the renewal of relevant qualifications. Besides, some customers request and we agreed to a lower price for a portion of our wastewater business in order to establish a long-term relationship, resulting in a decrease in revenue from that portion of the business.
  
  
• Revenue from platform outsourcing services decreased by RMB0.5 million ($0.1 million) or 13.0%. The decrease in revenue was primarily driven by a RMB0.8 million drop caused by reduced demand from former gas-station customers upgrading their in-house online systems and by lower cooperation with third-party partners. This decrease was partly offset by a RMB1.30 million increase driven by higher transaction volumes from diesel users and improved settlement rates with freight-exchange-platform customers.
  
  
• As of June 30, 2025, he factory for the chemical recycling is still under construction and has not started production and sales yet.

Cost of revenue

Cost of revenues decreased from RMB48.0 million for the year ended June 30, 2024 to RMB51.0 million ($7.1 million) for the same period in 2025.

For the years ended June 30, 2024 and 2025, cost of revenue from automation product and software was approximately RMB23.9 million ($3.3 million) and RMB28.6 million ($4.0 million), respectively, representing increase of approximately RMB4.7 million ($0.7 million) or 20.0%. The increase in cost of revenue from automation product and software was primarily attributable to increased revenue of automation products and software.

For the years ended June 30, 2024 and 2025, cost of revenue from equipment and accessories was approximately RMB14.1 million ($2.0 million) and RMB13.2 million ($1.8 million), respectively, representing a decrease of approximately RMB0.9 million ($0.1 million) or 6.2%. The decrease in costs of revenue was primarily driven by reduced business activity, mirroring the same factor behind the drop in revenue.

For the years ended June 30, 2024 and 2025, cost of revenue from oilfield environmental protection was approximately RMB9.2 million ($1.3 million) and RMB8.5 million ($1.2 million), respectively, representing a decrease of approximately RMB0.7 million ($0.1 million) or 7.5%. The decrease in the cost of revenue from oilfield environmental protection was in line with decrease in revenue.

For the years ended June 30, 2024 and 2025, cost of revenue from platform outsourcing services remained stable at RMB0.6 million ($0.09 million).

For the years ended June 30, 2024 and 2025, cost of revenue from chemical recycling was RMB0.1 million ($0.01 million) and nil, which was business and sales related tax. As of June 30, 2025, the factory for the chemical recycling is still under construction and has not started production and sales yet.

Gross profit

Gross profit increased to RMB15.2 million ($2.1 million) for the year ended June 30, 2025 from RMB20.9 million ($2.9 million) for the same period in 2024. Our gross profit as a percentage of revenue decreased to 23.0% for the year ended June 30, 2025 from 30.3% for the same period in 2024.

• For the years ended June 30, 2024 and 2025, our gross profit from automation product and software was approximately RMB3.0 million ($0.4 million) and RMB 5.5 million ($0.8 million), respectively, representing an increase in gross profit of approximately RMB2.5 million ($0.4 million) or 84.9%. The increase in gross margin was primarily due to the elevated proportion of high-margin service businesses.
  
  
• For the years ended June 30, 2024 and 2025, gross profit from equipment and accessories was approximately RMB6.4 million ($0.9 million) and RMB5.2 million ($0.7 million), respectively, representing a slight decrease of approximately RMB1.2 million ($0.2 million) or 18.5%. The decline in gross margin was primarily driven by the oilfield customers' shift to a low-cost operating model and tighter budget controls, compounded by an unexpected rise in after-sales expenses.
  
  
• For the years ended June 30, 2024 and 2025, gross profit from oilfield environmental protection was approximately RMB8.3 million ($1.2 million) and RMB1.7 million ($0.2 million), respectively, representing a decrease of RMB6.6 million ($0.9 million) or 79.1%. The main reason for the decrease in gross margin is that one of our customers reduced the settlement price.
  
  
• For the years ended June 30, 2024 and 2025, gross profit from platform outsourcing services was approximately RMB3.3 million ($0.5 million) and RMB2.8 million ($0.4 million), respectively, representing a decrease of approximately RMB0.5 million ($0.1 million) or 15.7%.  The decrease in gross profit was consistent with the change in revenue.
• For the years ended June 30, 2024 and 2025, gross profit losses from chemical recycling was RMB0.1 million ($0.01 million) and nil, respectively. As of June 30, 2025, the factory for the chemical recycling remains under construction and has not started production and sales yet.

Operating expenses

Selling expenses decreased by 9.9%, or RMB1.1 million ($0.1 million), from RMB10.4 million ($1.4 million) in the year ended June 30, 2024 to RMB9.3 million ($1.3 million) in the same period of 2025.

General and administrative expenses decreased by 22.1%, or RMB14.2 million ($2.0 million), from RMB63.8 million ($8.9 million) in the year ended June 30, 2024 to RMB49.6 million ($6.9 million) in the same period of 2025.

Net provision for credit losses of RMB4.1 million ($0.6 million) for the year ended June 30, 2024 as compared to net recovery of credit losses of RMB2.9 million ($0.4 million) for the same period in 2025.

Research and development expenses increased by 15.0%, or RMB2.1 million ($0.3 million) from RMB14.3 million ($2.0 million) for the year ended June 30, 2024 to RMB16.4 million ($2.3 million) for the same period of 2025.

Loss from operations

Loss from operations was RMB57.3 million ($8.0 million) for the year ended June 30, 2025, compared to a loss of RMB71.6 million ($10.0 million) for the same period of 2024. This RMB14.3 million ($2.0 million) decrease in loss from operations was primarily due to the decrease in operating expense as discussed above.

Change in fair value changes of warrant liability

The Company classified the warrants issued in connection with common share offering as liabilities at their fair value and adjusted the warrant instrument to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. Gain in change in fair value of warrant liability was RMB0.9 million ($0.1 million) and RMB0.01 million ($0.001 million) for the years ended June 30, 2024 and 2025, respectively. The primary reason for the decrease of loss in the fair value of the warrant liability was that on December 14, 2023, we redeemed an aggregate of 17,953,269 warrants (equivalent to 997,404 warrants post the 2024 Reverse Split) from the Sellers. Following this transaction, only 863,333 warrants remained outstanding (47,964 post-split), and the smaller outstanding balance directly lowered the magnitude of fair value changes.

Impairment loss on goodwill and intangible assets

The Company recognized the excess of purchase price over the fair value of assets acquired and liabilities assumed of the business acquired was recorded as goodwill and fair value of identified intangible assets, which is customer relationship as a result of the step acquisition of FGS. In conjunction with the preparation of our consolidated financial statement for years ended June 30, 2024 and 2025, the management performed evaluation on the impairment of goodwill and intangible assets and recorded an impairment loss on goodwill and intangible assets of nil and nil for the years ended June 30, 2024 and 2025, respectively. As of June 30, 2023, goodwill and intangible assets of FGS had fully accrued for impairment. The impairment was mainly due to the decision of the major customers to develop their own autonomous unified system and to significantly reduce the procurement of third-party services.

Interest income

Net interest income was RMB12.3 million ($1.7 million) for the year ended June 30, 2025, compared to net interest income of RMB21.8 million ($3.0 million) for the same period of 2024. The RMB9.5 million ($1.3 million) decrease in net interest income was primarily attributable to reduced third-party loan balances and lower allocations to short-term investments during the year ended June 30, 2025.

Other income (expenses), net.

Other net income was RMB1.3 million ($0.2 million) for the year ended June 30, 2025, compared to other net expenses of RMB0.7 million ($0.1 million) for the same period of 2024. The RMB2.0 million ($0.3 million) increase other net income was primarily due to a decrease in subsidy income of RMB0.2 million. The increase in other net income was attributable to a decrease in subsidy income and an asset write-off gain of approximately RMB0.1 million. Additionally, following the closure of the Qinghai office, RMB0.5 million in payables that could no longer be settled was recognized as income,  RMB0.2 million in receivables that could not be collected was written off as a loss and an increase in foreign exchange transaction income of RMB1.8 million due to the fluctuation of exchange rate of RMB against US dollars during the year ended June 30, 2025 compared to the same period of 2024.

Net loss

As a result of the factors described above, net loss was RMB43.7 million ($6.1 million) for the year ended June 30, 2025, a decrease of RMB7.7 million ($1.1 million) from net loss of RMB51.4 million ($7.2 million) for the same period of 2024.

Cash and short-term investment

As of June 30, 2025, we had cash in the amount of approximately RMB98.9 million ($13.8 million) and short-term investment in bank fixed income product of approximately RMB3.6 million ($0.5 million). As of June 30, 2024, we had cash in the amount of approximately RMB110.0 million ($15.4 million) and short-term investment in bank fixed income product of approximately RMB88.1million ($12.3 million).

About Recon Technology, Ltd ("RCON")

Recon Technology, Ltd (NASDAQ: RCON) is the People's Republic of China's first NASDAQ-listed non-state owned oil and gas field service company. Recon supplies China's largest oil exploration companies, Sinopec (NYSE: SNP) and The China National Petroleum Corporation ("CNPC"), with advanced automated technologies, efficient gathering and transportation equipment and reservoir stimulation measure for increasing petroleum extraction levels, reducing impurities and lowering production costs. Through the years, RCON has taken leading positions within several segmented markets of the oil and gas filed service industry. RCON also has developed stable long-term cooperation relationship with its major clients. For additional information please visit: http://www.recon.cn/. 

Forward-Looking Statements

Recon includes "forward-looking statements" within the meaning of the federal securities laws throughout this press release. A reader can identify forward-looking statements because they are not limited to historical fact or they use words such as "scheduled," "may," "will," "could," "should," "would," "expect," "believe," "anticipate," "project," "plan," "estimate," "forecast," "goal," "objective," "committed," "intend," "continue," or "will likely result," and similar expressions that concern Recon's strategy, plans, intentions or beliefs about future occurrences or results. Forward-looking statements are subject to risks, uncertainties and other factors that may change at any time and may cause actual results to differ materially from those that Recon expected. Many of these statements are derived from Recon's operating budgets and forecasts, which are based on many detailed assumptions that Recon believes are reasonable, or are based on various assumptions about certain plans, activities or events which we expect will or may occur in the future. However, it is very difficult to predict the effect of known factors, and Recon cannot anticipate all factors that could affect actual results that may be important to an investor. All forward-looking information should be evaluated in the context of these risks, uncertainties and other factors, including those factors disclosed under "Risk Factors" in Recon's most recent Annual Report on Form 20-F and any subsequent half-year financial filings on Form 6-K filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by the cautionary statements that Recon makes from time to time in its SEC filings and public communications. Recon cannot assure the reader that it will realize the results or developments Recon anticipates, or, even if substantially realized, that they will result in the consequences or affect Recon or its operations in the way Recon expects. Forward-looking statements speak only as of the date made. Recon undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances arising after the date on which they were made, except as otherwise required by law. As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements included herein or that may be made elsewhere from time to time by, or on behalf of, Recon.

For more information, please contact:

The Company
Ms. Liu Jia
Chief Financial Officer
Recon Technology, Ltd
Phone: +86 (10) 8494-5799
Email: liujia@recon.cn 

 

RECON TECHNOLOGY, LTD
CONSOLIDATED BALANCE SHEETS
		As of June, 30			As of June, 30			As of June, 30
		2024			2025			2025
		RMB			RMB			US Dollars
ASSETS
Current assets
Cash		¥	109,991,674		¥	98,874,577		$	13,802,361
Restricted cash			848,936			8,204			1,147
Short-term investments			88,091,794			3,599,211			502,430
Notes receivable			1,341,820			—			—
Accounts receivable, net			38,631,762			35,852,484			5,004,814
Inventories, net			1,128,912			1,344,588			187,697
Other receivables, net			3,352,052			3,760,881			524,999
Other receivables- related parties			275,976			67,976			9,489
Loans to third parties-short term			208,928,370			141,564,073			19,761,583
Purchase advances, net			5,156,550			14,619,556			2,040,811
Contract costs, net			48,335,817			53,547,408			7,474,930
Prepaid expenses			401,586			389,216			54,330
Deferred offering cost			—			2,529,724			353,136
Total Current Assets			506,485,249			356,157,898			49,717,727
Property and equipment, net			22,137,940			19,986,635			2,790,027
Construction in progress			219,132			12,000,900			1,675,261
Loans to third parties-long term			—			118,500,000			16,541,962
Operating lease right-of-use assets, net (including RMB1,769,840 and RMB696,851($97,277) from a     related party as of June 30, 2024 and June 30, 2025, respectively)			23,547,193			18,975,692			2,648,904
Total Assets		¥	552,389,514		¥	525,621,125		$	73,373,881
LIABILITIES AND EQUITY
Current liabilities
Short-term bank loans		¥	12,425,959		¥	11,582,336		$	1,616,832
Accounts payable			10,187,518			19,398,669			2,707,950
Other payables			2,769,685			6,154,889			859,189
Other payable- related parties			2,299,069			2,927,377			408,646
Contract liabilities			1,820,481			4,719,255			658,783
Accrued payroll and employees' welfare			3,237,164			3,212,227			448,410
Taxes payable			993,365			795,629			111,066
Short-term borrowings - related parties			10,002,875			10,017,250			1,398,354
Operating lease liabilities - current (including RMB1,775,114 and RMB355,601 ($49,640) from related     parties as of June 30, 2024 and June 30, 2025, respectively)			3,741,247			1,761,231			245,858
Total Current Liabilities			47,477,363			60,568,863			8,455,088
Operating lease liabilities - non-current (including RMB335,976 and nil from related parties as of June 30,     2024 and June 30, 2025, respectively)			3,971,285			1,081,827			151,017
Long-term borrowings - related party			10,000,000			10,000,000			1,395,946
Warrant liability - non-current			6,969			688			96
Total Liabilities			61,455,617			71,651,378			10,002,147
Commitments and Contingencies
Shareholders' Equity
Class A ordinary shares, $0.0001 U.S. dollar par value, 500,000,000 shares authorized; 7,987,959 shares     and 10,627,426 shares issued and outstanding as of June 30, 2024 and June 30, 2025, respectively*			99,634			101,548			14,176
Class B ordinary shares, $0.0001 U.S. dollar par value, 80,000,000 shares authorized; 7,100,000 shares     and 20,000,000 shares issued and outstanding as of June 30, 2024 and June 30, 2025, respectively*			4,693			14,038			1,960
Additional paid-in capital*			681,476,717			692,569,747			96,679,009
Statutory reserve			4,148,929			4,148,929			579,168
Accumulated deficit			(220,312,085)			(262,900,639)			(36,699,514)
Accumulated other comprehensive income			37,136,649			33,493,895			4,675,567
Total Recon Technology, Ltd' equity			502,554,537			467,427,518			65,250,366
Non-controlling interests			(11,620,640)			(13,457,771)			(1,878,632)
Total shareholders' equity			490,933,897			453,969,747			63,371,734
Total Liabilities and Shareholders' Equity		¥	552,389,514		¥	525,621,125		$	73,373,881
*      Retrospectively restated for the 1-for-18 reverse stock split on May 1, 2024 and change in capital structure on March 29, 2024.

 

RECON TECHNOLOGY, LTD
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE  LOSS
		For the years ended
		June 30,
		2023			2024			2025			2025
		RMB			RMB			RMB			US Dollars
Revenue		¥	67,114,378		¥	68,854,280		¥	66,285,032		$	9,253,034
Cost of revenue			48,247,395			47,976,836			51,044,495			7,125,537
Gross profit			18,866,983			20,877,444			15,240,537			2,127,497
Selling and distribution expenses			10,638,978			10,374,388			9,343,480			1,304,300
General and administrative expenses			76,784,396			63,765,583			49,645,680			6,930,270
Allowance for (net recovery of) credit losses			(9,038,985)			4,086,505			(2,856,803)			(398,794)
Impairment loss of property and equipment and other long-lived     assets			1,009,124			—			—			—
Research and development expenses			8,806,205			14,288,879			16,427,892			2,293,245
Operating expenses			88,199,718			92,515,355			72,560,249			10,129,021
Loss from operations			(69,332,735)			(71,637,911)			(57,319,712)			(8,001,524)
Other income (expenses)
Subsidy income			325,425			131,428			85,762			11,972
Interest income			13,603,487			22,897,763			13,390,041			1,869,178
Interest expense			(2,514,850)			(1,070,449)			(1,110,984)			(155,087)
Loss (gain) in fair value changes of warrants liability			6,116,000			(933,995)			6,226			869
Foreign exchange transaction gain (loss)			241,652			(881,695)			952,815			133,008
Impairment loss on goodwill and intangible assets			(9,980,002)			—			—			—
Other income			82,970			59,049			296,155			41,342
Other income, net			7,874,682			20,202,101			13,620,015			1,901,282
L oss before income tax			(61,458,053)			(51,435,810)			(43,699,697)			(6,100,242)
Income tax expenses			18,339			30			1,580			221
Net loss			(61,476,392)			(51,435,840)			(43,701,277)			(6,100,463)
Less: Net loss attributable to non-controlling interests			(2,309,091)			(1,564,581)			(1,112,723)			(155,330)
Net loss  attributable to Recon Technology, Ltd		¥	(59,167,301)		¥	(49,871,259)		¥	(42,588,554)		$	(5,945,133)
Comprehensive loss
Net loss			(61,476,392)			(51,435,840)			(43,701,277)			(6,100,463)
Foreign currency translation adjustment			23,819,712			2,009,476			(3,642,754)			(508,509)
Comprehensive loss			(37,656,680)			(49,426,364)			(47,344,031)			(6,608,972)
Less: Comprehensive loss attributable to non- controlling interests			(2,309,091)			(1,564,581)			(1,112,723)			(155,330)
Comprehensive loss attributable to Recon Technology, Ltd		¥	(35,347,589)		¥	(47,861,783)		¥	(46,231,308)		$	(6,453,642)
L oss per share - basic and diluted*		¥	(27.43)		¥	(9.88)		¥	(4.68)		$	(0.65)
Weighted - average shares -basic and diluted*			2,157,158			5,048,952			9,094,902			9,094,902
*    Retrospectively restated for the 1-for-18 reverse stock split on May 1, 2024.

 

RECON TECHNOLOGY, LTD
CONSOLIDATED STATEMENTS OF CASH FLOWS
		For the years ended June 30,
		2023			2024			2025			2025
		RMB			RMB			RMB			US Dollars
Cash flows from operating activities:
Net  loss		¥	(61,476,392)		¥	(51,435,840)		¥	(43,701,277)		$	(6,100,463)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization			3,683,586			2,844,025			3,147,936			439,435
Loss (gain) from disposal of property and equipment			(12,782)			35,325			12,410			1,732
(Gain) loss in fair value changes of warrants liability			(6,116,000)			933,995			(6,226)			(869)
Amortization of offering cost of warrants			1,483,306			—			—			—
Allowance for (net recovery of) credit losses			(9,038,985)			4,086,505			(2,856,803)			(398,794)
Allowance (reversal) for slow moving inventories			484,644			886,991			(1,251,279)			(174,672)
Impairment loss of property and equipment and other long-lived assets			1,009,124			—			—			—
Impairment loss on goodwill and intangible assets			9,980,002			—			—			—
Amortization of right of use assets			3,252,066			1,636,215			4,571,501			638,157
Restricted shares issued for management and employees			26,191,707			22,427,682			10,279,881			1,435,016
Restricted shares issued for services			5,805,840			1,070,143			—			—
Accrued interest income from loans to third parties			(7,997,961)			(6,998,866)			(5,288,121)			(738,193)
Accrued interest income from short-term investment			(2,901,955)			(885,394)			(17,411)			(2,430)
Changes in operating assets and liabilities:
Notes receivable			7,085,917			2,400,570			1,341,820			187,311
Accounts receivable			(495,784)			(12,151,359)			1,686,887			235,480
Inventories			(2,373,013)			5,590,058			267,413			37,329
Other receivables			(1,307,694)			31,908			(531,445)			(74,184)
Other receivables-related parties			(64,122)			(275,976)			208,000			29,036
Purchase advances			(2,575,198)			(2,422,123)			(5,057,967)			(706,065)
Contract costs			(14,236,539)			(4,400,442)			(363,721)			(50,773)
Prepaid expense			70,164			(51,467)			12,370			1,727
Prepaid expense - related parties			275,000			—			—			—
Operating lease liabilities			(3,061,303)			(2,907,014)			(4,869,474)			(679,752)
Accounts payable			(1,710,898)			(604,203)			1,940,574			270,894
Other payables			2,270,104			(3,020,216)			3,399,579			474,563
Other payables-related parties			352,260			(293,326)			628,308			87,708
Contract liabilities			641,087			(927,884)			2,898,774			404,653
Accrued payroll and employees' welfare			131,971			854,644			(24,937)			(3,481)
Taxes payable			(1,036,483)			(171,884)			(197,966)			(27,635)
Net cash used in operating activities			(51,688,331)			(43,747,933)			(33,771,174)			(4,714,270)
Cash flows from investing activities:
Purchases of property and equipment			(940,673)			(282,184)			(1,010,812)			(141,104)
Proceeds from disposal of property and equipment			31,950			20,000			2,000			279
Purchase of land use right			—			(15,000,251)			—			—
Repayments of loans to third parties			40,113,311			117,522,129			100,478,982			14,026,325
Payments made for loans to third parties			(103,146,761)			(196,437,504)			(140,490,800)			(19,611,759)
Payments and prepayments for construction in progress			—			(219,132)			(8,924,101)			(1,245,756)
Payments for short-term investments			(290,051,964)			(203,481,600)			(3,581,800)			(500,000)
Redemption of short-term investments			108,769,464			300,863,518			87,239,515			12,178,167
Net cash ( used in ) provided by  investing activities			(245,224,673)			2,984,976			33,712,984			4,706,152
Cash flows from financing activities:
Proceeds from short-term bank loans			13,491,481			11,581,000			10,476,000			1,462,393
Repayments of short-term bank loans			(11,040,000)			(11,632,755)			(11,319,623)			(1,580,158)
Repayments of short-term borrowings			—			—			—			—
Proceeds from short-term borrowings-related parties			15,013,115			10,000,000			—			—
Repayments of short-term borrowings-related parties			(9,000,000)			(10,018,222)			—			—
Repayments of long-term borrowings-related party			(1,499,667)			—			—			—
Proceeds from warrants issued with ordinary shares			17,493,069			—			—			—
Proceeds from sale of ordinary shares, net of issuance costs			28,174,993			77,711,533			(2,529,724)			(353,136)
Proceeds from sale of prefunded warrants, net of issuance costs			3,750,282			—			—			—
Redemption of warrants			—			(32,617,499)			—			—
Capital contribution by controlling shareholders			—			—			100,000			13,959
Net cash (used in)  provided by  financing activities			56,383,273			45,024,057			(3,273,347)			(456,942)
Effect of exchange rate fluctuation on cash and restricted cash			27,688,659			1,722,165			(8,626,292)			(1,204,184)
Net increase (decrease) in cash and restricted cash			(212,841,072)			5,983,265			(11,957,829)			(1,669,245)
Cash and restricted cash at beginning of year			317,698,417			104,857,345			110,840,610			15,472,753
Cash and restricted cash at end of year		¥	104,857,345		¥	110,840,610		¥	98,882,781		$	13,803,508
Reconciliation of cash and restricted cash, beginning of year
Cash		¥	316,974,857		¥	104,125,800		¥	109,991,674		$	15,354,246
Restricted cash			723,560			731,545			848,936			118,507
Cash and restricted cash, beginning of year		¥	317,698,417		¥	104,857,345		¥	110,840,610		$	15,472,753
Reconciliation of cash and restricted cash, end of year
Cash		¥	104,125,800		¥	109,991,674		¥	98,874,577		$	13,802,361
Restricted cash			731,545			848,936			8,204			1,147
Cash and restricted cash, end of year		¥	104,857,345		¥	110,840,610		¥	98,882,781		$	13,803,508
Supplemental cash flow information
Cash paid during the year for interest		¥	1,200,699		¥	659,472		¥	1,070,781		$	149,475
Cash paid during the year for income tax		¥	18,339		¥	—		¥	1,609		$	225
Non-cash investing and financing activities
Right-of-use assets obtained in exchange for operating lease obligations		¥	75,182		¥	8,303,099		¥	—		$	—
Reduction of right-of-use assets and operating lease obligations due to early termination of lease agreement		¥	62,357		¥	61,301		¥	1,886,347		$	263,324
Inventories transferred to and used as fixed assets		¥	(65,456)		¥	—		¥	—		$	—
Payable for construction in progress		¥	—		¥	—		¥	7,270,577		$	1,014,933
Capital contribution receivable due from non-controlling Interest		¥	—		¥	—		¥	724,408		$	101,123

 

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SOURCE Recon Technology, Ltd

FAQ

What were Recon Technology (RCON) full-year revenue and net loss for fiscal 2025?

Full-year revenue was RMB66.3M and net loss was RMB43.7M for the year ended June 30, 2025.

How did Recon's gross margin change in fiscal 2025 compared to 2024?

Gross margin decreased to 23.0% in fiscal 2025 from 30.3% in fiscal 2024.

What drove Recon (RCON) revenue growth in automation products in fiscal 2025?

Automation product and software revenue rose 27.1% (RMB7.3M) due to expanded sales and non-oilfield market penetration.

What caused the decline in Recon's oilfield environmental protection revenue in 2025?

Revenue fell 41.4% primarily because Gansu BHD's hazardous waste permit expired and was not renewed yet.

When did Recon start construction of its chemical recycling factory and when is completion expected?

Construction began on April 28, 2025, with completion anticipated by the end of 2025.

How much cash and short-term investments did Recon report as of June 30, 2025?

Cash was approximately RMB98.9M and short-term investment in bank fixed income product was RMB3.6M.

What operating expense trends affected Recon's fiscal 2025 results?

Selling expenses fell 9.9%, G&A decreased 22.1%, while R&D rose 15.0% year-over-year.