A-MARK PRECIOUS METALS, INC. AND SUBSIDIARIES QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2025

A-Mark Precious Metals Reports Strong Quarterly and Annual Results

A-Mark Precious Metals, a leading provider of precious metals products and services, has reported its financial results for the third quarter and first nine months of fiscal year 2025. The company’s diversified business model and strategic acquisitions have enabled it to deliver robust performance despite macroeconomic volatility.

Overview of Financial Performance

For the three months ended March 31, 2025, A-Mark reported revenues of $3.009 billion, up 15.3% from the prior year period. Excluding the impact of forward sales contracts, revenues increased 18.0% year-over-year. Gross profit rose 17.7% to $41.0 million, with the company’s overall gross margin percentage increasing to 1.363% from 1.334% in the prior year quarter.

For the nine months ended March 31, 2025, revenues grew 18.0% to $8.467 billion. Excluding forward sales, revenues increased 18.3% compared to the same period in 2024. Gross profit declined 0.8% to $129.2 million, with the gross margin percentage decreasing to 1.526% from 1.816% in the prior year period.

The company’s performance was driven by higher average selling prices for gold and silver, partially offset by decreases in gold and silver ounces sold. A-Mark also benefited from the acquisitions of Silver Gold Bull, Spectrum Group International, and Pinehurst Coin Exchange, which expanded its direct-to-consumer and wholesale operations.

Segment Performance

A-Mark operates in three reportable segments: Wholesale Sales & Ancillary Services, Direct-to-Consumer, and Secured Lending.

Wholesale Sales & Ancillary Services This segment, which includes the company’s trading, distribution, and minting operations, reported a 7.0% increase in revenues to $2.435 billion for the third quarter. Excluding the impact of forward sales, revenues grew 0.2%. Gross profit declined 5.8% to $15.9 million, with the gross margin percentage decreasing to 0.651% from 0.740% in the prior year quarter.

For the nine-month period, Wholesale Sales & Ancillary Services revenues increased 11.3% to $6.835 billion. Excluding forward sales, revenues grew 2.5%. Gross profit declined 19.5% to $55.6 million, with the gross margin percentage decreasing to 0.813% from 1.124% in the prior year period. The decrease in gross profit and margin was primarily due to lower premium spreads and trading profits.

Direct-to-Consumer The Direct-to-Consumer segment, which includes the company’s e-commerce and direct retail operations, reported a 26.1% increase in revenues to $1.009 billion for the third quarter. Gross profit rose 36.0% to $25.2 million, with the gross margin percentage increasing to 2.500% from 2.300% in the prior year quarter.

For the nine-month period, Direct-to-Consumer revenues grew 27.9% to $2.680 billion, while gross profit increased 22.0% to $73.7 million. The gross margin percentage decreased to 2.750% from 2.900% in the prior year period.

The segment’s performance was driven by strong customer demand, increased marketing efforts, and the integration of recent acquisitions like Silver Gold Bull and Pinehurst’s retail operations.

Secured Lending The Secured Lending segment, which provides financing solutions collateralized by precious metals, reported a 13.0% decrease in interest income to $2.6 million for the third quarter. The number of outstanding secured loans decreased 27.3% to 491 as of March 31, 2025, from 675 a year earlier, primarily due to lower precious metal prices.

For the nine-month period, interest income increased 2.1% to $7.8 million. The decline in the third quarter was offset by higher average loan balances earlier in the fiscal year.

Strengths and Weaknesses

A key strength of A-Mark is its diversified business model, which spans wholesale trading, e-commerce retail, and secured lending. This diversification helps the company navigate market volatility and capitalize on opportunities across the precious metals value chain.

The company’s strategic acquisitions have also been a major driver of growth, expanding its geographic reach, product offerings, and customer base. The integrations of Silver Gold Bull, Spectrum Group International, and Pinehurst Coin Exchange have strengthened A-Mark’s direct-to-consumer and wholesale capabilities.

Another strength is A-Mark’s long-standing relationships with sovereign mints, refiners, and a global network of dealers. This provides the company with reliable supply sources and distribution channels.

A potential weakness is the company’s exposure to fluctuations in precious metal prices and market volatility. While A-Mark has effective hedging strategies to mitigate price risk, significant swings in gold, silver, and other metal prices can still impact its financial results.

The company’s reliance on a small number of large customers in its Wholesale Sales & Ancillary Services segment is also a risk factor. The loss of one or more of these key customers could adversely affect the segment’s performance.

Outlook and Future Prospects

Looking ahead, A-Mark remains cautiously optimistic about its prospects. The company expects continued strong demand for precious metals products, driven by macroeconomic uncertainty and investor interest. Its recent acquisitions are also expected to contribute to future growth.

However, the company acknowledges that market volatility and other macroeconomic factors could impact its performance. A-Mark will continue to focus on expanding its customer base, diversifying its product and service offerings, and leveraging its integrated business model to drive long-term shareholder value.

Overall, A-Mark Precious Metals has demonstrated its ability to navigate a challenging market environment and deliver solid financial results. The company’s diversified operations, strategic acquisitions, and experienced management team position it well for continued success in the years ahead.