Gorilla Tech's Share Buyback Amid Persistent Financial Challenges

What happened

Gorilla Technology Group has executed approximately $5.0 million of its $20 million share repurchase program, buying back about 354,000 shares since the Board's authorization in Q4 2025. This move signals management's attempt to return capital and project confidence, but it comes against a backdrop of significant financial strain, including a 2024 IFRS net loss of $64.8 million and negative EBITDA. The company expects to release full-year 2025 financial results in mid-March, which will be crucial for assessing any progress toward profitability and revenue stability. Despite the buyback, core issues such as lumpy, project-driven revenue, dilution risk from past share issuance, and regulatory pressures from the EU AI Act remain unaddressed. Investors should view this action skeptically, as it does not resolve the underlying operational and financial vulnerabilities highlighted in the latest DeepValue report.

Implication

First, the $5 million repurchase is a relatively small use of capital compared to ongoing losses and does not guarantee improved shareholder value. Second, without clear progress on margin recovery or cash flow positivity, such programs risk depleting resources needed for growth and regulatory compliance. Third, the upcoming 2025 financials will be pivotal in validating management's ability to stabilize revenue and curb dilution, as historical performance has been volatile. Fourth, any failure to show meaningful backlog growth or recurring revenue mix improvement could negate the perceived benefits of the buyback. Fifth, investors must monitor capital allocation closely, as further equity issuance could offset any repurchase gains, maintaining the dilution risk outlined in the DeepValue report.

Thesis delta

The share repurchase update does not shift the fundamental investment thesis, which remains constrained by lumpy revenue, negative EBITDA, and ongoing dilution risk. However, if the 2025 results demonstrate improved profitability, stable gross margins, and disciplined capital needs, it could support a more constructive outlook. Until then, the HOLD/NEUTRAL stance is justified, with the buyback being a minor positive that fails to address core financial challenges.