LINK

Interlink is a $67M microcap that has now lost money in four of the last five years, and 2025 was no exception: revenue of $11.9M grew just 1.8% and remains below the 2023 peak of $13.9M, while the company posted a $1.61M net loss (-13.6% margin) and a $1.83M operating loss (-15.4% margin). The narrower loss year-over-year is real but was engineered by cutting engineering/R&D 27% (from $2.05M to $1.50M in the MD&A) rather than by operating leverage — a worrying trade for a company whose entire pitch is 'differentiated sensing platforms' and 'multi-year production programs' from long design cycles. Gross margin actually deteriorated from 41.5% to 38.9% as cost of revenue rose faster than sales, so the core business is getting less profitable, not more.

The balance sheet is the one genuine strength and the reason this is a 'sell' rather than an 'avoid': liabilities/equity of just 0.27x, $2.72M cash, $6.3M current assets against $1.66M current liabilities, and near-breakeven operating cash flow (-$112K) mean there is no imminent solvency threat. But that solidity is being diluted away — shares outstanding jumped 59.7% to 15.8M, and the accumulated deficit sits at -$53.8M against only $9.22M of equity ($0.58/share book value). Investors are funding acquisitions (Calman, Conductive Transfers, SPEC/KWJ) that have grown the top line but never delivered sustained profit.