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SPCB, SuperCom Ltd. Ordinary Shares (Israel)

Semiconductors asset-light UnprofitableDistress / turnaround

Revenue is IoT (91%), e-Gov (6%) and Cyber Security (3%).

Latest annual: FY2025 20-F · US listing is the ordinary share

SPCB · SuperCom Ltd. Ordinary Shares (Israel)

The business

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

Revenue · FY2025

$28M

+0.9% YoY · 19% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $28M 5-yr avg $22M

Gross margin 55% 5-yr avg 46%

Operating margin −1.2% 5-yr avg −21.1%

ROIC −0% 5-yr avg −9%

Owner-earnings margin −23% 5-yr avg −33%

Free cash flow margin −23% 5-yr avg −33%

The business in brief

read the 10-K →

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

What it is: A semiconductor business, riding a brutal capacity cycle on the edge of Moore's Law.
Situation: Unprofitable. No meaningful revenue yet; the record is the cash on hand against the burn. Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock.
What moves the needle: Operating margin has run around −34% through the cycle on a 39% gross margin, the operating line deeply negative — so the lever is the path to a margin at all: revenue growth against the cost curve and the cash runway, not the level of a margin that isn't there yet. Inventory runs near 15% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on process leadership and the capex cycle. On its own account, the filing leans hardest on supplier & input dependence, 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 −17%, above 15% in 0 of 10 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.

Where the money comes from

read the 20-F →

IoT is 91% of revenue, so this is largely a single-segment business.

Revenue by reportable segment, FY2025

IoT91%$25M
e-Gov6%$2M
Cyber Security3%$819K

By geographyEuropean countries43%Israel28%United States25%Africa4%Asia Pacific0%South America0%

From the segment footnote of the company's own 20-F. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMDec 2025
											Income statement
$20M	$33M	$22M	$16M	$12M	$12M	$18M	$27M	$28M	$28M	$28M	RevenueRevenue
13%	39%	37%	39%	47%	51%	36%	38%	48%	55%	55%	Gross marginGross mgn
($12M)	($7M)	($10M)	($8M)	($4M)	($7M)	($6M)	($3M)	($777K)	($322K)	($322K)	Operating incomeOp. inc.
−57.9%	−19.6%	−44.2%	−49.6%	−31.9%	−54.9%	−34.0%	−12.6%	−2.8%	−1.2%	−1.2%	Operating marginOp. mgn
($14M)	($7M)	($16M)	($12M)	($8M)	($10M)	($7M)	($4M)	$661K	$4M	($16M)	Net incomeNet inc.
											Cash flow & returns
($11M)	($2M)	($6M)	($8M)	($7M)	($10M)	($5M)	($2M)	($1M)	($5M)	($5M)	Operating cash flowOp. cash
$3M	$4M	$4M	$3M	$3M	$2M	$3M	$3M	$3M	$4M	$4M	DepreciationDeprec.
($57K)	$772K	$6M	$717K	($1M)	($2M)	$112K	($1M)	($5M)	($13M)	$6M	Working capital & otherWC & other
$400K	$301K	$283K	$414K	$812K	$949K	$524K	$2M	$2M	$880K	$880K	CapexCapex
2.0%	0.9%	1.3%	2.5%	6.9%	7.7%	3.0%	6.5%	5.8%	3.2%	3.2%	Capex / revenueCapex/rev
($11M)	($2M)	($7M)	($8M)	($7M)	($11M)	($5M)	($4M)	($3M)	($6M)	($6M)	Owner earningsOwner earn.
−57.2%	−6.9%	−30.6%	−49.0%	−62.2%	−86.8%	−29.3%	−15.4%	−10.5%	−22.8%	−22.8%	Owner earnings marginOE mgn
($11M)	($2M)	($7M)	($8M)	($7M)	($11M)	($5M)	($4M)	($3M)	($6M)	($6M)	Free cash flowFCF
−57.2%	−6.9%	−30.6%	−49.0%	−62.2%	−86.8%	−29.3%	−15.4%	−10.5%	−22.8%	−22.8%	Free cash flow marginFCF mgn
$3M	$0	$0	—	—	—	—	—	—	—	—	BuybacksBuybacks
-25%	-16%	-28%	-29%	-18%	-17%	-15%	-8%	-2%	-1%	-0%	ROICROIC
-36%	-20%	-81%	-138%	-160%	-231%	-238%	-84%	6%	9%	-36%	Return on equityROE
−36%	−20%	−81%	−138%	−160%	−231%	−238%	−84%	6%	9%	−36%	Retained to equityRetained/eq
											Balance sheet
$2M	$1M	$2M	$110K	$3M	$4M	$4M	$5M	$3M	$12M	$12M	Cash & investmentsCash+inv
$10M	$12M	$13M	$13M	$12M	$11M	$11M	$13M	$13M	$15M	$15M	ReceivablesReceiv.
$5M	$5M	$3M	$3M	$2M	$4M	$3M	$3M	$3M	$2M	$2M	InventoryInvent.
$16M	$17M	$17M	$16M	$15M	$15M	$14M	$16M	$15M	$17M	$17M	Operating working capitalOper. WC
$21M	$27M	$26M	$23M	$25M	$26M	$26M	$28M	$26M	$37M	$37M	Current assetsCur. assets
$13M	$18M	$14M	$14M	$20M	$6M	$5M	$5M	$4M	$5M	$5M	Current liabilitiesCur. liab.
1.7×	1.5×	1.9×	1.6×	1.3×	4.7×	5.0×	5.3×	7.0×	8.0×	8.0×	Current ratioCurr. ratio
$7M	$7M	$7M	$7M	$7M	$7M	$7M	$7M	$7M	$7M	$7M	GoodwillGoodwill
$53M	$54M	$44M	$40M	$40M	$42M	$42M	$45M	$46M	$68M	$68M	Total assetsAssets
$0	$0	$10M	$14M	$15M	$30M	$33M	$34M	$30M	$19M	$19M	Total debtDebt
($2M)	($1M)	$8M	$14M	$12M	$27M	$29M	$29M	$27M	$7M	$7M	Net debt / (cash)Net debt
-53.0×	-30.9×	-11.5×	-4.2×	-1.0×	-1.8×	-3.4×	-1.3×	-0.4×	-0.1×	-0.1×	Interest coverageInt. cov.
$39M	$33M	$20M	$8M	$5M	$4M	$3M	$5M	$12M	$44M	$44M	Shareholders’ equityEquity
											Per share
15.0M	14.9M	15.2M	16.1M	17.4M	2.6M	185K	338K	1.7M	5.0M	5.4M	Shares out (diluted)Shares
$1.33	$2.23	$1.44	$1.02	$0.68	$4.68	$95.63	$78.59	$15.97	$5.62	$5.20	Revenue / shareRev/sh
$-0.93	$-0.45	$-1.03	$-0.71	$-0.45	$-3.87	$-40.40	$-11.90	$0.38	$0.75	$-2.93	EPS (diluted)EPS
$-0.76	$-0.15	$-0.44	$-0.50	$-0.42	$-4.06	$-28.06	$-12.07	$-1.67	$-1.28	$-1.19	Owner earnings / shareOE/sh
$-0.76	$-0.15	$-0.44	$-0.50	$-0.42	$-4.06	$-28.06	$-12.07	$-1.67	$-1.28	$-1.19	Free cash flow / shareFCF/sh
$0.03	$0.02	$0.02	$0.03	$0.05	$0.36	$2.84	$5.07	$0.92	$0.18	$0.16	Cap. spending / shareCapex/sh
$2.57	$2.19	$1.28	$0.52	$0.28	$1.68	$16.96	$14.24	$6.76	$8.76	$8.10	Book value / shareBVPS

The diluted share count moved ×1/6.64 into 2021 — shares retired, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×1/14.19 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 ×1.83 into 2023 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×5.12 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 ×2.87 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

	9-yr	5-yr
Revenue / share	+17.4%/yr	+52.7%/yr
Capital spending / share	+23.5%/yr	+30.6%/yr
Book value / share	+14.6%/yr	+98.7%/yr

The record, charted

FY2016–2025

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

Share count

5Mpeak FY2020

ROIC

−1%low FY2019

Gross margin

55%low FY2016

Owner earnings vs. net income

Owner earningsNet income

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

($6M)owner earningsvs.$4Mnet incomelow FY2016

Owner-earnings bridge

FY2021–FY2025cash-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 2025 the business reported $4M of profit but ($6M) of owner earnings: $10M less than the profit line, taken out by capital spending and the timing of cash.

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$4M	$661K	($4M)	($7M)	($10M)
Depreciation & amortizationnon-cash charge added back	+$4M	+$3M	+$3M	+$3M	+$2M
Working capital & othertiming of cash in and out, other non-cash items	−$13M	−$5M	−$1M	+$112K	−$2M
Cash from operations	($5M)	($1M)	($2M)	($5M)	($10M)
Capital expenditurecash put back in to keep running and to grow	−$880K	−$2M	−$2M	−$524K	−$949K
Owner earnings	($6M)	($3M)	($4M)	($5M)	($11M)
Owner-earnings marginowner earnings ÷ revenue	-23%	-10%	-15%	-29%	-87%

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 .

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

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 20-F · source on SEC EDGAR →

Will it survive?

Can it pay its interest? -0.1×

Does not cover its interest

Operating income ($322K) ÷ interest expense $2M

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? $7M

Net debt against an operating loss

Cash $10M + ST investments $2M − debt $19M

What this means
Netting $12M of cash and short-term investments against $19M of debt leaves $7M owed, with no operating profit this year to measure it against — understand that combination before anything else about the company. 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? —

Not enough data

What this means
The filing data didn't include the inputs for this check.

Is it a good business?

Return on invested capital -17%

Below average through the cycle

10-yr median, range -29%–-1%; -0% latest = NOPAT ($254K) ÷ invested capital $52M

Industry peers: median -23%

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 10 years (it ran -0% 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 -31%

Consumes cash through the cycle

10-yr median margin, range -87%–-7%; latest ($6M) = operating cash ($5M) − maintenance capex $880K

Industry peers: median -10%

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 -23% of revenue this year, a -31% median across 10 years.
Are earnings backed by cash? ($5M)

Loss, and burning cash

Net income ($16M) · cash from operations ($5M)

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? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 0.23×

Harvesting

Capex $880K ÷ depreciation $4M

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 · $28M

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× · 7.96×

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 · $19M vs $33M 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 (10-yr record) · 8 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 $0.02/share (latest year $-2.93), the averaged base the calculator's gate runs on, and book value is $8.10/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, 2016–2025

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

Profitable years 2 of 10

What this means
Lost money in 8 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 10 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 −41% → −6% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about −41% early to −6% lately, median −34% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2016 · −57.9% op. margin

What this means
Operations went underwater in 2016, understand why before trusting the good years.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

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 fiscal year-end, Dec 31, 2025

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$37M

Cash & short-term investments$12M
Receivables$15M
Inventory$2M
Other current assets$8M

Current liabilities$5M

Other current liabilities$5M

Current ratio7.96×all current assets ÷ what's due · Graham looked for 2×

Quick ratio7.49×stricter: inventory excluded

Cash ratio2.60×strictest: cash alone against what's due

Working capital$33Mthe cushion left after near-term bills

Cash runway1.9 yrsthe business is consuming cash; this is how long the cash on hand lasts at that rate

Deeper floors

Tangible book value$24Mequity stripped of goodwill & intangibles

Net current asset value$12MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$19M$425K of it operating leases

Deferred revenue$778Kcustomer cash collected before delivery; operating float

From the company's latest filing.

Acquisitions & goodwill

from the balance sheet & the 10-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$19M28% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity16%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$0over 10 years buying other businesses, against $8M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Inverting the record

Invert: instead of why SuperCom Ltd. Ordinary Shares (Israel) is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 3 tests turned up something to look into; the other 2 came back clean.

Look hereDid debt outgrow the business?$0 → $19M
Debt rose from $0 to $19M while owner earnings went from about ($7M) to ($4M): the borrowing grew and the earnings that would carry it are not there now. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.

And these came back clean

Is it less profitable than it was?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Semiconductors

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
AXTIAXT Inc	$88M	32%	6.0%	4%	-16%
AMBQAmbiq Micro Inc.	$73M	44%	-54.5%	-141%	—
AIPArteris Inc.	$71M	90%	-56.0%	—	-3%
NVTSNavitas Semiconductor Corporation	$46M	33%	-196.7%	-41%	-108%
KOPNKopin Corporation	$39M	35%	-65.8%	-70%	-40%
LPTHLightPath Technologies Inc.	$37M	35%	-4.8%	-5%	-0%
SPCBSuperCom Ltd. Ordinary Shares (Israel)	$28M	39%	-32.9%	-17%	-30%
NVECNVE Corporation	$26M	79%	61.3%	21%	52%
Group median	—	37%	-43.7%	-17%	-16%

The price

What a price has to assume.

What the price implies

reverse-DCF

Enter the US price, in dollars: the NYSE/Nasdaq quote you hold. SuperCom Ltd. Ordinary Shares (Israel)'s US listing is the ordinary share itself. The record tables elsewhere on this page remain as filed.

SuperCom Ltd. Ordinary Shares (Israel) 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, delivered23%/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−23%

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 SPCB against another business →

Cite: Owner Scorecard, "SuperCom Ltd. Ordinary Shares (Israel) (SPCB), the owner's record," https://ownerscorecard.com/c/SPCB, data as of 2026-07-09.

Manual order: ← SORA its page in the Manual SPHL →

Industry order: ← SMTC the Semiconductors chapter STM →