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PHUN, Phunware Inc.

IT Services & Consulting asset-light UnprofitableNet current asset value

A software business, earning high margins on code once it is written.

Latest annual: FY2025 10-K

PHUN · Phunware Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$3M

−19.9% YoY · −24% 5-yr CAGR

Vital signs · TTM

Cash & investments $98M

Cash burn · annual $12M

Runway 8.3 yrs

Gross margin 55%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Unprofitable. No meaningful revenue yet; the record is the cash on hand against the burn. Net current asset value. Current assets alone exceed every liability combined, and the surplus is most of the balance sheet: the shape Graham called a net-net.
What moves the needle: Operating margin has run around −175% through the cycle on a 51% gross margin, the operating line in the red even at its best — so the lever is whether the spending below the gross line can come down enough to clear a profit: revenue growth against the cost curve, and the cash runway until it does. Stock-based pay runs about 45% of sales, a real and recurring claim on owners that the GAAP margin understates. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on litigation & contingencies, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −124%, above 15% in 0 of 6 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2017–2025

realized figures from each filing · older years to the left

2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
										Income statement
$27M	$31M	$19M	$10M	$11M	$7M	$5M	$3M	$3M	$2M	RevenueRevenue
41%	62%	53%	66%	34%	54%	35%	46%	51%	55%	Gross marginGross mgn
55%	44%	80%	154%	125%	265%	285%	328%	599%	604%	SG&A / revenueSG&A/rev
42%	23%	23%	26%	39%	94%	92%	71%	124%	134%	R&D / revenueR&D/rev
($26M)	($7M)	($12M)	($17M)	($17M)	($24M)	($46M)	($14M)	($21M)	($20M)	Operating incomeOp. inc.
−95.9%	−22.2%	−64.3%	−175.0%	−158.3%	−368.5%	−945.6%	−435.5%	−803.7%	−819.6%	Operating marginOp. mgn
($26M)	($10M)	($13M)	($22M)	($54M)	($51M)	($53M)	($10M)	($11M)	($11M)	Net incomeNet inc.
										Cash flow & returns
($17M)	($7M)	($6M)	($11M)	($23M)	($27M)	($18M)	($13M)	($12M)	($12M)	Operating cash flowOp. cash
$154K	$62K	$59K	$11K	—	—	—	—	—	$5K	DepreciationDeprec.
$9M	$3M	$5M	$7M	$26M	$21M	$30M	($5M)	($2M)	($1M)	Working capital & otherWC & other
—	$0	$18K	$0	$0	$923K	$0	—	—	$0	CapexCapex
—	0.0%	0.1%	0.0%	0.0%	14.2%	0.0%	—	—	0.0%	Capex / revenueCapex/rev
—	($7M)	($6M)	($11M)	($23M)	($28M)	($18M)	—	—	($12M)	Owner earningsOwner earn.
—	−21.3%	−32.4%	−109.7%	−211.5%	−426.0%	−381.5%	—	—	−492.7%	Owner earnings marginOE mgn
—	($7M)	($6M)	($11M)	($23M)	($28M)	($18M)	—	—	($12M)	Free cash flowFCF
—	−21.3%	−32.4%	−109.7%	−211.5%	−426.0%	−381.5%	—	—	−492.7%	Free cash flow marginFCF mgn
—	—	—	$0	$5M	$2M	—	—	—	$1M	AcquisitionsAcquis.
—	$53M	—	—	—	$0	$502K	—	—	—	BuybacksBuybacks
-266%	-78%	-169%	-607%	-28%	-58%	—	—	—	—	ROICROIC
-328%	-168%	-320%	—	-82%	-205%	—	-10%	-12%	-12%	Return on equityROE
−328%	−168%	−320%	—	−82%	−205%	—	−10%	−12%	−12%	Retained to equityRetained/eq
										Balance sheet
$308K	$844K	$276K	$4M	$23M	$2M	$4M	$113M	$101M	$98M	Cash & investmentsCash+inv
$6M	$4M	$2M	$664K	$967K	$835K	$550K	$276K	$300K	$474K	ReceivablesReceiv.
—	—	—	$0	$3M	$3M	—	—	—	$899K	InventoryInvent.
$4M	$10M	$10M	$8M	$7M	$7M	$8M	$4M	$1M	$3M	Accounts payablePayables
$3M	($6M)	($8M)	($8M)	($3M)	($4M)	($7M)	($3M)	($770K)	($1M)	Operating working capitalOper. WC
$7M	$5M	$2M	$5M	$60M	$17M	$5M	$114M	$120M	$99M	Current assetsCur. assets
$15M	$20M	$20M	$26M	$30M	$26M	$17M	$6M	$24M	$6M	Current liabilitiesCur. liab.
0.5×	0.2×	0.1×	0.2×	2.0×	0.7×	0.3×	17.6×	5.0×	16.9×	Current ratioCurr. ratio
$26M	$26M	$26M	$26M	$33M	$26M	$0	—	—	$0	GoodwillGoodwill
$34M	$37M	$29M	$32M	$98M	$55M	$7M	$115M	$121M	$100M	Total assetsAssets
—	$2M	$2M	$8M	$5M	$10M	$5M	—	—	$2M	Total debtDebt
—	$1M	$2M	$4M	($18M)	$8M	$1M	—	—	($96M)	Net debt / (cash)Net debt
-64.5×	-9.5×	-21.2×	-5.1×	-3.8×	-10.0×	-26.4×	-102.9×	-641.2×	-616.5×	Interest coverageInt. cov.
$8M	$6M	$4M	($2M)	$65M	$25M	($11M)	$107M	$96M	$93M	Shareholders’ equityEquity
0.4%	1.5%	9.3%	44.9%	46.4%	46.1%	84.3%	51.9%	17.8%	20.0%	Stock comp / revenueSBC/rev
										Per share
24.5M	25.6M	36.9M	44.3M	75.4M	2.0M	2.4M	11.0M	20.2M	20.2M	Shares out (diluted)Shares
$1.09	$1.21	$0.52	$0.23	$0.14	$3.29	$2.03	$0.29	$0.13	$0.12	Revenue / shareRev/sh
$-1.06	$-0.38	$-0.35	$-0.50	$-0.71	$-25.71	$-22.18	$-0.94	$-0.57	$-0.54	EPS (diluted)EPS
—	$-0.26	$-0.17	$-0.25	$-0.30	$-14.03	$-7.75	—	—	$-0.59	Owner earnings / shareOE/sh
—	$-0.26	$-0.17	$-0.25	$-0.30	$-14.03	$-7.75	—	—	$-0.59	Free cash flow / shareFCF/sh
—	$0.00	$0.00	$0.00	$0.00	$0.47	$0.00	—	—	$0.00	Cap. spending / shareCapex/sh
$0.32	$0.23	$0.11	$-0.04	$0.87	$12.57	$-4.81	$9.77	$4.77	$4.62	Book value / shareBVPS

The diluted share count moved ×1.44 into 2019 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×1.7 into 2021 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×1/38.11 into 2022 — shares retired, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×4.61 into 2024 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×1.84 into 2025 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	8-yr	5-yr
Revenue / share	−23.6%/yr	−10.9%/yr
Book value / share	+40.1%/yr	—

The record, charted

FY2017–2025

Each measure over its full record; the current point and the worst year marked.

Share count

20Mpeak FY2021

ROIC

−58%low FY2020

Gross margin

51%low FY2021

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

($18M)owner earningsvs.($53M)net incomelow FY2022

Owner-earnings bridge

FY2019–FY2023cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2023 the business turned a $53M loss into ($18M) of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

	FY2023	FY2022	FY2021	FY2020	FY2019
Reported net income	($53M)	($51M)	($54M)	($22M)	($13M)
Depreciation & amortizationnon-cash charge added back	—	—	—	+$11K	+$59K
Stock-based compensationreal costnon-cash, but a real cost	+$4M	+$3M	+$5M	+$4M	+$2M
Working capital & othertiming of cash in and out, other non-cash items	+$30M	+$21M	+$26M	+$7M	+$5M
Cash from operations	($18M)	($27M)	($23M)	($11M)	($6M)
Capital expenditurecash put back in to keep running and to grow	—	−$923K	—	—	−$18K
Owner earnings	($18M)	($28M)	($23M)	($11M)	($6M)
Owner-earnings marginowner earnings ÷ revenue	-382%	-426%	-212%	-110%	-32%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $4M), owner earnings is nearer ($23M).

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? -641.2×

Does not cover its interest

Operating income ($21M) ÷ interest expense $32K

What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
How heavy is the debt, net of cash? +$96M

Net cash

Cash $101M − debt $5M

What this means
Cash and short-term investments exceed every dollar of debt by $96M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 537d

Long (60+ days)

DSO 43 + DIO 804 − DPO 309 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital -169%

Below average through the cycle

6-yr median, range -607%–-28%; -2434% latest = NOPAT ($16M) ÷ invested capital $666K

Industry peers: median -243%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 6 years (it ran -2434% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin -212%

Consumes cash through the cycle

6-yr median margin, range -426%–-21%; latest ($12M) = operating cash ($12M) − maintenance capex $0

Industry peers: median -582%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -488% of revenue this year, a -212% median across 6 years. Treating stock comp as the real expense it is (less $455K of SBC) leaves ($13M).
Are earnings backed by cash? ($12M)

Loss, and burning cash

Net income ($11M) · cash from operations ($12M)

In the filing’s words And the filing leans heavily on adjusted, non-GAAP earnings — steering you off the GAAP figure just where the cash is not backing it. Read the reconciliation in the notes before taking the adjusted number.

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did not.

How is the cash used?

Where do the earnings go? —

No surplus to allocate

What this means
The business didn't generate positive Owner Earnings this year, so any distributions came from the balance sheet or borrowing, not from operations.
Investing or harvesting? 0.00×

Harvesting

Capex $0 ÷ depreciation $11K

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $3M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 5.03×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $5M vs $96M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (9-yr record) · 9 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-1.21/share (latest year $-0.56), the averaged base the calculator's gate runs on, and book value is $4.71/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2017–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 0 of 9

What this means
Lost money in 9 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 5 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −61% → −728% (3-yr avg ends)

What this means
Through the cycle the operating margin slipped — about −61% early to −728% lately, median −175% — competition or costs are biting in.
Reinvestment, incremental ROIC −42%

What this means
Reinvested capital came back at a negative incremental return over this window — the invested base grew while operating profit did not. The filings show where it went.
Worst year 2023 · −945.6% op. margin

What this means
Operations went underwater in 2023, understand why before trusting the good years.
Share count −2.4%/yr

What this means
The share count is shrinking, buybacks are quietly growing your slice of the business.

Does AI threaten the moat?

Elevated contestability

The product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.

In its own filing Framed as a capability

Despite the structural exposure, the filing positions AI as something it uses, not a threat to its product.

“Cloud-based intelligence and automation features, including AI-enabled interfaces and analytics capabilities, designed to support contextual user interactions, information discovery and service-related workflows within customer applications.”

AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$99M

Cash & short-term investments$98M
Receivables$474K
Inventory$899K

Current liabilities$6M

Accounts payable$3M
Other current liabilities$3M

Current ratio16.95×all current assets ÷ what's due · Graham looked for 2×

Quick ratio16.79×stricter: inventory excluded

Cash ratio16.74×strictest: cash alone against what's due

Working capital$93Mthe cushion left after near-term bills

Cash runway8.3 yrsthe business is consuming cash; this is how long the cash on hand lasts at that rate

Revenue, latest quarter vs. a year ago−21.2%the freshest read on whether the business is still growing

Current ratio, recent quarters2.8× → 16.9×

Deeper floors

Tangible book value$91Mequity stripped of goodwill & intangibles

Net current asset value$93MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$537K$537K of it operating leases

Deferred revenue$2Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Acquisitions & goodwill

from the balance sheet & the 9-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$3M2% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity0%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$7Mover 9 years buying other businesses, against $941K of capital spent building

$26M written down across 1 year (2023): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 9-year record, from the company's own filings.

Management, ownership & pay

From the proxy: how much of the business the people running it own, and how they are paid.

Stock-based compensation$455K
The slice of the business handed to employees in shares this year, 18% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, IT Services & Consulting

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
QBTSD-Wave Quantum Inc.	$25M	68%	-724.6%	-1142%	-582%
GEGGLGreat Elm Group, Inc.	$16M	93%	-46.5%	-12%	-3%
NXTTNext Technology Holding Inc.	$12M	59%	-24.0%	-1%	-29%
PDYNPalladyne AI Corp.	$5M	30%	-916.4%	-333%	-500%
DJTTrump Media & Technology Group Corp.	$4M	55%	-3360.9%	-18%	-943%
ODYSOdysight.ai Inc.	$3M	29%	-593.1%	-442%	-584%
PHUNPhunware Inc.	$3M	51%	-175.0%	-124%	-161%
MOVECorvex Inc.	$433K	—	-3580.4%	-243%	-2604%
Group median	—	55%	-658.9%	-183%	-541%

The price

What a price has to assume.

What the price implies

reverse-DCF

Phunware Inc. is profitable, but owner earnings are negative this year because capital spending currently outruns operating cash, a build-out, so the owner-earnings reverse-DCF has no positive base to grow. We read the price from both ends instead: type a price to see the steady-state profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.

Today’s price $

The assumptions Required return 9% Years to get there 10 Revenue growth 0%

Revenue, delivered−26%/yr’20→’25

Mature owner-earnings margin 15%

Enter a price to run it.

Owner earnings it must reach—

Margin the price demands—

Owner-earnings margin today−493%

Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.

Weigh PHUN against another business →

The owners of PHUN: the meeting and the votes →

Cite: Owner Scorecard, "Phunware Inc. (PHUN), the owner's record," https://ownerscorecard.com/c/PHUN, data as of 2026-07-09.

Manual order: ← PHR its page in the Manual PI →

Industry order: ← PERI the IT Services & Consulting chapter PLTK →