Diamond Equity Research Releases Update Note on uCloudlink Group Inc. (NASDAQ: UCL)
New York, Aug. 18, 2025 (GLOBE NEWSWIRE) -- Diamond Equity Research, an equity research firm with a focus on small capitalization public companies has released update note on uCloudlink Group Inc. (NASDAQ:UCL). The update note includes information on uCloudlink Group Inc.'s financial results, management commentary, recent developments, outlook, risks, and our revised valuation estimates.
The update note is available below.
uCloudlink Group Update Note August 2025
Highlights from the note include:
• uCloudlink Announced Q2 Results - uCloudlink reported its financial results for Q2 2025, with total revenues of $19.4 million, a year-on-year decrease of 13.3%, including $14.6 million in service revenue (up 3.3%) and $4.8 million in product sales (down 42%). The decline in product sales was primarily due to the delay of a multi-million-dollar mobile broadband order from Japan (which will be placed in Q3), as well as lower-than-expected sales in the U.S. market due to the macroeconomic and trade headwinds. This resulted in a geographical shift in the company's revenue structure, with Japan contributing 33.6% (down from 46.2%), mainland China 33.2% (up from 23.5%), North America 15.3%, and other regions 17.9%. The overall gross margin expanded from 49.2% to 52.8%, primarily due to the increase in product gross profit margin. Operating expenses increased to $10.4 million, mainly due to a 28.2% rise in sales and marketing costs as the company continued to invest more in branding its upcoming products. uCloudlink's net income for Q2 2025 was $0.7 million, or $0.02 per basic and diluted ADS, versus a net income of $2.2 million, or $0.06 per basic and diluted ADS in the year-ago period. uCloudlink achieved solid service revenue growth and margin expansion, in line with our expectations. At the same time, the company is actively adjusting its supply chain to offset the impact of trade tariffs and will launch new products starting in Q3 to further diversify its product mix, which we believe will help support its targeted long-term growth and sustainable profitability.
• GlocalMe Ecosystem Continues to Gain Traction and Growth Momentum – uCloudlink's average month active terminals (MAT) for GlocalMe IoT, GlocalMe SIM, and GlocalMe Life increased by 791.0%, 120.1%, and 105.2% YoY, respectively, demonstrating robust growth in its GlocalMe ecosystem. We believe the growth is driven by the company's focused investment in R&D and marketing for new product lines, as well as the establishment of strategic partnerships. The company has innovated and achieved advancements across its multiple product lines: its pet connectivity solution, PetPhone, which is expected to be commercially released in Q3 this year, has attracted several potential strategic partners, one of which will assist PetPhone in listing in Hong Kong and thus expanding its global market reach; the GlocalMe IoT solutions experienced significant YoY increase in user adoption since commercialization, enabling IoT connectivity solutions for various verticals; eSIM Trio, the latest GlocalMe SIM solution has also gained market visibility and exposure with positive feedback. We believe these innovations will further expand the company's product portfolio and diversify its revenue streams, thereby driving future growth.
• Valuation Update – Despite macroeconomic challenges and trade headwinds, uCloudlink is actively mitigating the impact of tariffs by strategically adjusting its supply chain while creating new growth opportunities through product innovation. Our valuation for UCL remains $10.00, combining discounted cash flow and comparable company analysis, which is contingent on the company maintaining its successful execution.
About uCloudlink Group Inc.
uCloudlink operates as an innovative mobile technology company that offers the world's first and leading mobile data traffic sharing marketplace to users globally, with aggregated mobile data allowances from over 391 MNOs (mobile network operator) globally. Leveraging its integral cloud SIM technology, it allows users to enjoy a smooth mobile connectivity experience without limitation to one MNO. uCloudlink was incorporated in 2014 and is headquartered in Hong Kong.
For more information, visit https://ucloudlink.gcs-web.com.
About Diamond Equity Research
Diamond Equity Research is a leading equity research and corporate access firm focused on small capitalization companies. Diamond Equity Research is an approved sell-side provider on major institutional investor platforms.
For more information, visit https://www.diamondequityresearch.com.
Disclosures:
Diamond Equity Research LLC is being compensated by uCloudlink Group Inc. for producing research materials regarding uCloudlink Group Inc. and its securities, which is meant to subsidize the high cost of creating the report and monitoring the security, however the views in the report reflect that of Diamond Equity Research. All payments are received upfront and are billed for research engagement. As of 08/18/2025 the issuer had paid us $175,000 for our research services, consisting of $20,000 for an initiation report and $15,000 for six update notes in the first year of coverage and $35,000 in the second, third, fourth and fifth year of coverage for update notes during the term, which commenced 06/01/2021 and is renewable annually. Diamond Equity Research LLC may be compensated for non-research related services, including presenting at Diamond Equity Research investment conferences, press releases and other additional services. The non-research related service cost is dependent on the company, but usually do not exceed $5,000. The issuer has not paid us for non-research related services as of 08/18/2025. Issuers are not required to engage us for these additional services. Additional fees may have accrued since then. Although Diamond Equity Research company sponsored reports are based on publicly available information and although no investment recommendations are made within our company sponsored research reports, given the small capitalization nature of the companies we cover we have adopted an internal trading procedure around the public companies by whom we are engaged, with investors able to find such policy on our website public disclosures page. This report and press release do not consider individual circumstances and does not take into consideration individual investor preferences. Statements within this report may constitute forward-looking statements, these statements involve many risk factors and general uncertainties around the business, industry, and macroeconomic environment. Investors need to be aware of the high degree of risk in small capitalization equities including the complete loss of their investment. Investors can find various risk factors in the initiation report and in the respective financial filings for uCloudlink Group Inc. Please review update report attached for full disclosures.
Contact:
Diamond Equity Research
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