A-Mark Precious Metals Inc. (AMRK) shares plummeted over 12% in pre-market trading on Tuesday, following the release of the company's fiscal Q1 2025 earnings results, which missed analysts' expectations and revealed a significant decline in profitability.

The precious metals trading company reported a 9% increase in revenue to $2.72 billion, driven by growth in its Direct-to-Consumer (DTC) segment. However, this figure fell short of analysts' expectations of $2.62 billion. More concerning was the substantial drop in net income to $9 million, or $0.37 per diluted share, compared to $18.8 million, or $0.77 per share, in the same quarter last year.

The earnings miss was primarily attributed to lower gross profit margins and higher operating expenses. Gross profit decreased by 12% to $43.4 million, as the company faced pressure from lower profits in its wholesale sales and ancillary services. Additionally, selling, general, and administrative (SG&A) expenses surged by 22% to $26.6 million, driven by increased compensation costs, advertising, and consulting fees.