Symbotic Stock Falls 18.9% After Q4 Earnings, Amplifying Concerns Over Losses and Walmart Dependence

What happened

Symbotic reported its fourth-quarter fiscal 2025 earnings on November 24, 2025, leading to an 18.9% stock decline as of mid-December. This drop reflects market disappointment, likely tied to ongoing profitability challenges highlighted in the DeepValue master report, which shows Q3 FY2025 operating losses and net losses. The company boasts a strong $22.4 billion backlog from Walmart and GreenBox commitments but remains unprofitable with volatile free cash flow. Critical risks include extreme customer concentration, with Walmart accounting for approximately 87% of FY2024 revenue, and elevated leverage at a net debt to EBITDA ratio of 12.11x. Despite multi-year visibility from contracts, the price action signals investor skepticism about near-term execution and competitive pressures in warehouse automation.

Implication

The sharp post-earnings decline underscores the market's lack of confidence in Symbotic's path to profitability, reinforcing the need for close monitoring of key execution milestones like Walmart's APD conversions and GreenBox order flow. Long-term implications include potential volatility if delays occur in these contracts, which could exacerbate cash flow pressures and competitive threats from rivals like AutoStore. Investors must weigh the substantial backlog against the company's loss-making operations and high leverage, which limit margin of safety in the current valuation. A shift to a buy rating would require consistent operating profits, positive free cash flow, and reduced debt levels, none of which are evident from recent filings. Until these improvements materialize, the stock remains speculative, suitable only for risk-tolerant investors with a long-term horizon.

Thesis delta

The 18.9% price drop since Q4 earnings does not fundamentally change the HOLD thesis from the DeepValue report, as it aligns with pre-existing concerns about profitability and customer concentration. However, it highlights increased market impatience and elevates the urgency for Symbotic to demonstrate progress on its $22.4 billion backlog conversion and cost discipline. Investors should watch for tangible signs of operational improvement in upcoming quarters before reassessing the investment case.