RE:Kraken Robotics Q3 profit hit by higher financing costs In spite the lower sales, real reason why net income is down are due to lower cost of goods sold.
In an Accounting context, most companies uses the "Absorption Method" where stocking inventory and lowering sales costs will result in lower Cost of Goods Sold, leading to higher net income or lower losses.
That's exactly a problem with the "Absorption Method" as opposed to the "Direct Method" or "Contribution Margin Method" is you can have higher sales and still have lower profits due to greater Cost of Goods Sold and lower inventories.
Kraken's losses were not deep as their Cost of Goods Sold was lower in the previous quarter.